>The new request comes after the California Public Utilities Commission, which Gov. Gavin Newsom's administration oversees, approved six rate increases for PG&E in 2024.
>PG&E also reported a record $2.47 billion in profits in 2024, which was an increase from an earlier record that was set in 2023.
Well that's all I needed to see. If an increase every two months and setting a new profit record every year isn't enough then maybe someone else should be in charge of this. Maybe the people who need this should be in charge of this, not someone whose sole purpose is to squeeze those people for as much as possible.
>Well that's all I needed to see. If an increase every two months and setting a new profit record every year isn't enough then maybe someone else should be in charge of this.
Given inflation is a thing, wouldn't you expect "record profits" year after year, even if nothing else changed?
>> someone whose sole purpose is to squeeze those people for as much as possible
If you look at https://finance.yahoo.com/quote/PCG/ and select all data, it looks like PG&E's stock price is around the same as it was in 1985. That means that adjusted for inflation, it has lost most of its value over that time period. It pays a 0.58% dividend, which, as the article says, is "the lowest dividend in its industry".
Returning far worse profits than treasury bonds is not squeezing people for as much as possible.
You're talking about where the money is going. I'm talking about where the money is coming from. Regardless of what they're spending it on later the amount of money left after all expenses are paid is going up and that increase is coming from consumers.
I'm not a Californian, so I'm sure there's something I'm missing, but why haven't you guys recalled Newsom yet or at least primaried him out during the last election? Do typical Californians think he's doing a good job or is it just that the alternatives are always worse?
The biggest investors in PG&E are Blackrock, Vanguard, Fidelity, JP Morgan. So in other words, people's 401ks. Not sure how it makes sense that your retirement depends on a company with no competition and the ability to charge you any amount of money they want.
I find it a bit hilarious that I, living in the reddest state in the union, have member-owned cooperative power [1] that is 100% wind while my parents in California pay 6x my rate for mostly natural gas [2] and wildfires.
That too. But since we're in this situation where it's a public company, it's just funny to me that people's finances are both being helped and harmed by PG&E, probably canceling itself out.
On the aggregate this cancels out, but on the micro level this is just a kind of wealth transfer from the poor to the investor/retiree class, not too different from a tax on the young and less fortunate. The rich boomers are getting their retirement subsidized by screwing over the working class and the younger generation, pretty on brand I'd say.
1. I've paid electric bills in four different cities. Rates haven't been increased at more than 1x annually in any of them.
2. California is getting what seems to be two overhauls: a) replacing/upgrading lines and vegetation practices to harden them against sparking fires; b) massive electrification of cars, data centers, appliances. The capex has to be paid somehow... and interest rates are a drag to that.
> Rates haven't been increased at more than 1x annually in any of them.
Do you mean 2x?
> California is getting what seems to be two overhauls
I believe large share of rate increase is because PG&E need to pay multibillion penalty for previous years of negligence which caused multiple fires with casualties.
> The new request comes after the California Public Utilities Commission, which Gov. Gavin Newsom's administration oversees, approved six rate increases for PG&E in 2024
How are rate increases counted?
I don't know how rates work in California, but looking at rates in my state the power company for my region has a bunch of different rate schedules. There's the normal residential rate schedule, 3 different time-of-use based residential rate schedules that are being tested, and rate schedules for businesses (I think there may be several depending on the kind of business). They may be different residential schedules for rural customers and non-rural customers. I think there are also some different schedules for farms.
Depending on how you count you could end up with a dozen rate increases in a year but with each customer seeing 0 or 1 increases.
> [...] state Sen. Aisha Wahab filed a proposal, the Investor-Owned Utilities Accountability Act, that would [...]
> It would also cap any rate increase to no more than the Consumer Price Index, which is a measure of the average change over time in the prices consumers generally pay for goods and services.
Is the CPI appropriate for this? I would expect that the most important factors that affect the cost of running an electric utility would not not correlate well with the CPI. Shouldn't any cap be tied to something that more closely matches the costs of running the utility?
>Well that's all I needed to see. If an increase every two months and setting a new profit record every year isn't enough then maybe someone else should be in charge of this.
Gross profit is not relevant, $2.4B on sales of $24B is only a 10% profit margin. With 5.6 million customers, that is $440 per customer in profits.
They said they invest 97% of profits back into infrastructure, prior to this rate increase proposal. A 3% investors profit share is quite enough and I hope they’re denied by the state. PG&E capped at returning 3% of profit to investors a year for a century would be an appropriate sentence and sentencing term for the Redwood City explosion. Investors will invest in it no matter how small the guaranteed profit, because they’re a monopoly, and literally every dollar the state allows them to pay out in shareholder dividends is paid for out of the state’s GDP after the year’s wildfires and outages.
It would be interesting to do the math and estimate about how many dollars they expect this to generate in payouts, and then express that payout in terms of infrastructure ruggedization. Are they asking for an investor payout the size of “10% of the estimated cost of deploying underground wiring in wildfire-probe forested regions”? 25%? 150%?
Muni utilities get treated with kid's gloves by courts though. I have direct personal experience of a muni burning nearly a quarter million acres, destroying over 500 homes and ~100K acres of timber. When it came to trial, the court capped their liability at $50m on day one. Their employees even joked about what an outrageous fire hazard all their lines were over text just a few days before it happened.
The funniest part is the utility increased rates...but only for people living in the fire-affected areas.
Readit News
>PG&E also reported a record $2.47 billion in profits in 2024, which was an increase from an earlier record that was set in 2023.
Well that's all I needed to see. If an increase every two months and setting a new profit record every year isn't enough then maybe someone else should be in charge of this. Maybe the people who need this should be in charge of this, not someone whose sole purpose is to squeeze those people for as much as possible.
Given inflation is a thing, wouldn't you expect "record profits" year after year, even if nothing else changed?
If you look at https://finance.yahoo.com/quote/PCG/ and select all data, it looks like PG&E's stock price is around the same as it was in 1985. That means that adjusted for inflation, it has lost most of its value over that time period. It pays a 0.58% dividend, which, as the article says, is "the lowest dividend in its industry".
Returning far worse profits than treasury bonds is not squeezing people for as much as possible.
The last one generally benefits the customers.
I find it a bit hilarious that I, living in the reddest state in the union, have member-owned cooperative power [1] that is 100% wind while my parents in California pay 6x my rate for mostly natural gas [2] and wildfires.
[1] https://www.lvenergy.com/my-account/
[2] https://www.energy.ca.gov/data-reports/energy-almanac/califo...
2. California is getting what seems to be two overhauls: a) replacing/upgrading lines and vegetation practices to harden them against sparking fires; b) massive electrification of cars, data centers, appliances. The capex has to be paid somehow... and interest rates are a drag to that.
Do you mean 2x?
> California is getting what seems to be two overhauls
I believe large share of rate increase is because PG&E need to pay multibillion penalty for previous years of negligence which caused multiple fires with casualties.
So if the total bill doubles from last pay period period, it is said that it has _increased_ 1x.
https://www.cawildfirefund.com/participating-utility-compani...
How are rate increases counted?
I don't know how rates work in California, but looking at rates in my state the power company for my region has a bunch of different rate schedules. There's the normal residential rate schedule, 3 different time-of-use based residential rate schedules that are being tested, and rate schedules for businesses (I think there may be several depending on the kind of business). They may be different residential schedules for rural customers and non-rural customers. I think there are also some different schedules for farms.
Depending on how you count you could end up with a dozen rate increases in a year but with each customer seeing 0 or 1 increases.
> [...] state Sen. Aisha Wahab filed a proposal, the Investor-Owned Utilities Accountability Act, that would [...]
> It would also cap any rate increase to no more than the Consumer Price Index, which is a measure of the average change over time in the prices consumers generally pay for goods and services.
Is the CPI appropriate for this? I would expect that the most important factors that affect the cost of running an electric utility would not not correlate well with the CPI. Shouldn't any cap be tied to something that more closely matches the costs of running the utility?
Gross profit is not relevant, $2.4B on sales of $24B is only a 10% profit margin. With 5.6 million customers, that is $440 per customer in profits.
It would be interesting to do the math and estimate about how many dollars they expect this to generate in payouts, and then express that payout in terms of infrastructure ruggedization. Are they asking for an investor payout the size of “10% of the estimated cost of deploying underground wiring in wildfire-probe forested regions”? 25%? 150%?
The funniest part is the utility increased rates...but only for people living in the fire-affected areas.
Somebody has to pay.
They also don't keep your 401k healthy.
https://kevin.burke.dev/kevin/norcal-cities-new-utility/