Calif. Consumers Seek Breaks Before Electricity-Rate Hike Is Decided

Apr 02, 2001

Calif. Consumers Seek Breaks Before Electricity-Rate Hike Is Decided

As state regulators prepare to decide in coming weeks who will bear the burden of a massive new electricity-rate hike, a long line is beginning to form of residents, business operators and others seeking a break.

The tiered plan proposed by Public Utilities Commission President Loretta Lynch exempts those who use no more than 130 percent of their ``baseline'' allotment. But other residents could see increases up to 36 percent, while commercial customers could pay even more.

Homeowners say there's no way they can save that much. Advocates for the poor and elderly are crying foul. Businesses say they're already unfairly burdened.

Residents now poring over their bills and baselines - which are supposed to represent average usage - are puzzled and frustrated. While regulators say almost half of housholds use no more than 130 percent of their baseline, many energy misers wonder just who those people could be.

``This just blows me away,'' said Ellen Finch of San Jose, Calif. ``I'm out of ways to save, short of turning everything off. How on earth does an average household function on the baseline rates? How many people does an average household have - zero?''

The 45-year-old technical writer has cut down dishwashing to once a week and laundry to twice a week. She's pushed the thermostat down to 67 and put blankets on every chair. She's turned off lights and limited her computer, TV and stereo. Still, Finch says she's using up to twice her baseline amount and expects her bill to go up at least 9 percent, or about $12.

Utilities haven't yet calculated just how many residents would fall within the 130 percent. Estimates range from 30 to nearly 50 percent.

Many residents still are trying to figure how their baselines work. Studying past bills, they see different figures. That's because the baselines are daily figures, and the number of days in monthly billing cycles vary. In addition, the baselines change in May and November to account for differences in summer and winter use.

``It's very difficult for me to understand what this means to me financially,'' said Bruce Capron, 69, of Cupertino, Calif.

Baselines were established in the early 1980s to promote conservation by allowing utilities to charge higher rates for above-average consumption. It's based on 50 percent to 60 percent of average usage within each of 19 climatic ``territories'' in the state.

Baselines take into account the various energy needs caused by regional and seasonal climatic differences. Also considered are whether a home has all electric appliances or some powered by gas, as well as whether it is an apartment or detached house. Customers with medical needs can apply for additional baseline credits.

But baselines don't take into account the size of the home or number of occupants. Some argue that unfairly punishes the poor, who often have to share housing with large numbers of family and friends to make rent.

``One of the things we do see as an issue is that a lot of low-income families tend to have multiple families in a unit or larger families,'' said Julia Macias, project director for energy issues at the Latino Issues Forum.

``They tend to go over the baseline not just because they are `energy hogs,' as Lynch calls them, but just because they have more people in the units,'' Macias said.

Because of language differences, many Latinos aren't aware of the exemptions and other programs for low-income residents and don't apply for them, Macias said. In addition, they tend to live in older and less efficient housing. And for economic reasons, they're already doing what they can to save.

``Low-income families tend to conserve as it is and so further conservation tends to be really hard,'' Macias said. ``We would like to see something done to make exceptions for people in those situations.''

Others have similar worries about the elderly, who tend to live on fixed incomes in older and less-efficient housing, and face greater health risks from extreme temperatures.

``Seniors are going to be disproportionately affected by this,'' said Hoyt Minkoff, program director with the Consumer Federation of California and consultant to the Congress of California Seniors. ``Seniors typically are going to be more vulnerable to the elements and the hot weather is going to affect them more than others. So they're going to need to run their air conditioning and their fans more than others.''

Some argue the baseline system should take into account all the new electronic gizmos, from computers to DVD players, that have become commonplace in many modern homes.

But Pacific Gas & Electric Co. spokesman John Nelson says that's accounted for because the baselines are recalculated regularly. Because it's based on average usage within an area, if most people use more power, the baseline will go up. In fact, the baseline for the zone that includes Silicon Valley increased slightly in the last 10 years, while the neighboring zone including San Francisco hasn't changed, he said.

Commercial customers, who pay lower rates but would see a proportionately greater increase, also are crying foul.

Grocers are upset because they had cut energy consumption 10 percent at the request of Gov. Gray Davis last year, which means it will be that much harder for them to further lower their electricity bills.

``We had hoped it would be spread out more evenly, not so much focused on the real heavy users,'' said Dave Heylen, spokesman for the California Grocers Association. ``Unfortunately, it takes a lot of electricity to ensure a safe food supply. The bulk of our energy use is geared toward cooler cases, freezer cases, those types of things.''

Nursing homes argue they cannot afford the higher rates.

``When they raise the electricity rates, we don't have any way of absorbing the costs'' immediately, said Nancy Armentrout of the California Association of Health Facilities. ``The government hasn't given us any money to compensate for the increased cost of energy.''

But some consumer advocates argue that exempting various groups will only cripple efforts to reward conservation.

``It's a crude and blunt tool,'' said Nettie Hoge of The Utility Reform Network.