Some calling energy baselines unfair

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The Associated Press

The state’s method of setting “baseline” power levels – a key ingredient in distributing rate hikes – is being criticized as unfair by consumer advocates and some customers.

Baseline levels are intended to represent the minimum amount of electricity an average household uses in a particular region. The cost of electricity goes up as use rises above the baseline.

But state officials have designated a small number of large baseline regions, some combining cooler coastal areas and inland communities that use air conditioning more often. In addition, baselines are tied to average consumption within a region without regard to home size or number of occupants.

For instance, Miamon Miller and Martha Adams – who live in a 800-square foot home in Santa Monica with no air conditioner – often use one-third or less of their baseline allowance. They owed a whopping $2.32 for their last monthly Southern California Edison bill.

But they have the same baseline level as Marjorie Shipp, who lives in an 1,800-square-foot home in Compton, where summer days average 10 to 15 degrees hotter. Her two-adult home has reduced energy usage more than 40 percent, but remained at nearly double the baseline; her bill was nearly $180.

“I don’t know what else I can do,” said the retired teacher.

The baseline allowance “does not address the real needs of consumers,” said Douglas Heller of the Santa Monica-based Foundation for Taxpayer and Consumer Rights. “We’ve said, somewhat tongue in cheek, that this baseline plan is a subsidy of single guys by families.”

Residential customers of Edison and Pacific Gas and Electric Co. will get a full taste of the new rates in this month’s bills, which will reflect an entire month of the increase.

The state Public Utilities Commission boosted electricity rates by a record 3 cents a kilowatt-hour on March 27, and decreed that residential customers would pay according to how much electricity they use.

The baseline, established by the PUC, is meant to represent 50 percent to 60 percent of an average household’s electricity use in a region. Edison‘s 50,000-square-mile territory is divided into six baseline zones. PG&E has 10 for its 70,000 square miles. San Diego Gas and Electric, which has not increased rates, has three zones.

Under the previous, two-tier billing system, customers paid less for electricity used up to baseline levels and more for electricity use above baseline. That has been replaced by a five-step system in which residential customers pay the old rates in two tiers up to 130 percent of baseline but progressively more across three tiers of usage above 130 percent of baseline.

PG&E says only 35 percent of its customers have been able to keep their electricity consumption at 130 percent or less of baseline in the last year. At Edison, about half of customers have done it.

Residents of Los Angeles and other cities served by municipal utilities are not affected by the new rate structure and baseline program.

State regulators and legislators say they are aware of the problems, and are considering overhauling the baseline allowances, but the changes will come in time for this summer.

“There are real questions over whether these baselines are fair,” PUC Commissioner Carl Wood said. “This is not going to be without controversy. This is not a giveaway program. It’s not a matter of jacking up everyone’s baselines to reduce rates.”

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