[{"_1":2,"_112":-5,"_113":-5},"loaderData",{"_3":4,"_26":27},"root",{"_5":6,"_17":10,"_18":19,"_20":21,"_22":10,"_23":-5,"_24":-5,"_25":10},"user",{"_7":8,"_9":10,"_11":10,"_12":-5,"_13":-5,"_14":15,"_16":-5},"roles",[],"isAuthenticated",false,"isPremium","planName","subscriptionStatus","featureFlags",{},"insightsBudget","isDevelopmentHost","userPreferences",{},"recaptchaSiteKey","6LcvOJcUAAAAAHsB-gPGfGktcRlKpH7OTIU_dMTD","isImpersonating","impersonation","affiliateStatus","isFreedomPortal","routes/v2/article/layout",{"_28":29,"_30":31},"notFound",true,"relatedArticles",[32,76,88,100],{"_33":34,"_35":36,"_37":38,"_39":40,"_41":42,"_43":44,"_45":46,"_47":48,"_49":50,"_51":52,"_53":54,"_55":56,"_57":58,"_59":60,"_61":62,"_63":64,"_65":66,"_67":68,"_69":70,"_71":72,"_73":74,"_75":74},"mediaId",6155177,"mediaKeyId","5480678-d128d65ac9e26e8f2ef633b92e790f74","parentId",5480678,"title","Public Advocates Office urges stricter cost scrutiny, rethought rate design to ease bill increases","audioSeconds",324,"startMs",3556000,"endMs",3880000,"viewUrl","/Search/View?dp=1&key=5480678-d128d65ac9e26e8f2ef633b92e790f74&start=3556&end=3880","thumbnailUrl","https://assets.pipeline.soar.com/5480678-d128d65ac9e26e8f2ef633b92e790f74/thumbnail_3556000.jpg","articleUrl","/articles/6155177/California/Public-Advocates-Office-urges-stricter-cost-scrutiny-rethought-rate-design-to-ease-bill-increases","mediaUrl","https://secure.pipeline.soar.com/6155177-41cc5b310a428b448a450fbb67aab2e9/orig.mp4?Expires=1770453758&Signature=CgGMC1TGZJj1WnPYGiKXM1b9twZ8ouZPPHWua-7uXubZmAq86cLpljNk3G5XLCL9HK7B~-7ls0k3-dh9i~fXRLfaMGQJCCe9iBMZZFHu31g9Tv3bca~4tUhM5ClAEgMVOIf1CX8HkowPtPvWlC0dahi6RWRdDZQu~6Z652JZ958Xc7vHOSaqwfqgC5ggC7MMel-scWnT72g6fzlBNgmB03HAkB1dLDN87wh3UXgVqkXOsmNLjIxdtoIo1sUjYbJKhuE8-TBMkItyP6AcjsGzoULUSZYPBRx18QhtVPUHIHIXvin67lOdYrH8UKSvaQ-gwgQdPTZUh8IddSmE6QTohg__&Key-Pair-Id=KUT5TJCACFTXG","author","Little Hoover Commission","date","2025-07-26T04:07:05.67Z","article","Michael Campbell, deputy director for energy at the Public Advocates Office, told the Little Hoover Commission that the office's statutory mission is to “advocate for the lowest possible rates for utility customers” and that the sharp rise in electricity rates over the last decade has multiple causes that warrant scrutiny.

Key drivers and levers: Campbell highlighted three principal areas for immediate attention: (1) operating and maintenance (O&M) costs that utilities recover dollar-for-dollar in rates and have grown faster than inflation; (2) capital spending (capex) that adds to rate base and interacts with the authorized return on equity; and (3) rate design, where reliance on volumetric (per-kWh) charges and inadequate fixed-cost recovery can create regressive effects when participants avoid volumetric charges.

Recommendations described at the hearing included stronger scrutiny of O&M in general rate cases, careful review of capital investment prudence, exploration of lower-cost financing such as securitization for large legacy costs, and reconsideration of rate design to align cost causation with who pays. Campbell said some programs funded through rates do not pass cost-effectiveness tests and that redirecting poorly performing programs to non-ratepayer funding could yield more than $500 million in annual rate relief, subject to statutory and budgetary constraints.

On data centers and new load: Campbell told commissioners that whether new large loads lower or raise rates depends on timing, interconnection costs and permanence. He cautioned against assuming new load will always reduce rates and urged careful protections to avoid leaving ratepayers with stranded costs if large customers depart.

Process and oversight: Campbell described the Public Advocates Office's role as an active litigant within CPUC proceedings with discovery, testimony and cross-examination powers and said the office uses those tools to test utilities' cost claims. He also said that returning more spending forecasts to general rate case processes would produce better trade-offs and stronger discipline on utility proposals.","mediaType","Video","parentTitle","Hearing on California Electricity Costs (Part 4) - July 24, 2025","oneSentenceSummary","The Public Advocates Office told the Little Hoover Commission that cutting unnecessary operating and capital spending and rethinking rate design are the most direct ways to reduce electricity bills for California customers.","taxTitle","Little Hoover Commission, Other State Agencies, Executive, California","taxId",76737,"location","California","headline","","shortSummary",{"_33":77,"_35":36,"_37":38,"_39":78,"_41":79,"_43":80,"_45":81,"_47":82,"_49":83,"_51":84,"_53":85,"_55":56,"_57":58,"_59":86,"_61":62,"_63":64,"_65":87,"_67":68,"_69":70,"_71":72,"_73":74,"_75":74},6155182,"California Energy Commission: efficiency rules and programs deliver large net savings and should be preserved",524,2682000,3206000,"/Search/View?dp=1&key=5480678-d128d65ac9e26e8f2ef633b92e790f74&start=2682&end=3206","https://assets.pipeline.soar.com/5480678-d128d65ac9e26e8f2ef633b92e790f74/thumbnail_2682000.jpg","/articles/6155182/California/California-Energy-Commission-efficiency-rules-and-programs-deliver-large-net-savings-and-should-be-preserved","https://secure.pipeline.soar.com/6155182-fa497105855d1f7aa7f9df6bb39f12aa/orig.mp4?Expires=1770453758&Signature=mpUlrTCz63kHXiRi7SLDwOx27hdq-Bp3deNhANBMOSC7tvnITbCP1FYwQvcatFDwrR55kTZ-Jl9nvFXZ9Tu9oPEe1vjX6vF8nCBE~qZrYKfiwIkrXWBY2I7YnMCZ6bPiSgxKCBez1cK0Sug55e0HPRUa3fu4~i7RFJ1hZiDEkKBZohJgxnAY9BLhEXDhM~7vlVaKfNCA2f2rQ6AheQYR93G0XGzEHsi2fA0O41wNqhs-6-ib4~t0HeMJJw8CRgKncjFRqa0pUKfHrdDLb8esUgKmJYnT~hASh~UdVFYWZNDKTh13c92k98Wj9qMKT5PKawDgKWITxp5AWFol-B15lw__&Key-Pair-Id=KUT5TJCACFTXG","Michael Sokol, director of the Efficiency Division at the California Energy Commission, told the Little Hoover Commission the agency reviewed its ratepayer-funded programs after Governor Newsom's affordability executive order and concluded that \"the big energy efficiency programs remain highly cost beneficial and deliver substantial savings to customers\" while helping meet the state's clean-energy goals.

Sokol summarized four program areas: codes and standards, CalSHAPE (school ventilation and plumbing grants), the statewide solar equipment lists that streamline permitting and interconnection, and the Electric Program Investment Charge (EPIC) research program. He said California's appliance and building efficiency standards have saved Californians more than $200 billion cumulatively and that the most recent building code updates are projected to yield $4.8 billion in energy savings over 30 years.

On CalSHAPE and school funding, Sokol said the program has awarded 273 plumbing grants and 841 ventilation grants totaling $789 million and noted that Proposition 2 (voter-approved school facilities funding) provides $10 billion for school upgrades; unencumbered CalSHAPE funds (about $200 million) could be repurposed, he said, and the governor's May budget revision proposed reverting unencumbered CalSHAPE funds to utilities for reliability work (legislative action pending).

EPIC and equipment lists: Sokol described the EPIC program as a leading state R&D program (roughly $148 million annually) that has invested about $1.4 billion since 2011 and helped recipients attract roughly $19 billion in additional private funding. He said the solar equipment lists cost about $1.3 million per year and deliver labor and time-savings for utilities and building departments well in excess of that cost.

What the CEC did not propose: Sokol said the CEC is not recommending major cuts to these programs and emphasized continuous monitoring, cross-agency coordination and ensuring equity-focused benefits for vulnerable customers. His testimony urged that efficiency remain central to affordability efforts because saved energy permanently reduces customer bills.","The California Energy Commission told the Little Hoover Commission that statewide efficiency standards, school ventilation and plumbing grants, equipment listing work and the EPIC research program produce net savings and other benefits that contribute to affordability, reliability and emissions reductions.",{"_33":89,"_35":36,"_37":38,"_39":90,"_41":91,"_43":92,"_45":93,"_47":94,"_49":95,"_51":96,"_53":97,"_55":56,"_57":58,"_59":98,"_61":62,"_63":64,"_65":99,"_67":68,"_69":70,"_71":72,"_73":74,"_75":74},6155187,"Commissioners press CPUC on AI data centers as PG&E reports thousands of megawatts in queue",166,1794000,1960000,"/Search/View?dp=1&key=5480678-d128d65ac9e26e8f2ef633b92e790f74&start=1794&end=1960","https://assets.pipeline.soar.com/5480678-d128d65ac9e26e8f2ef633b92e790f74/thumbnail_1794000.jpg","/articles/6155187/California/Commissioners-press-CPUC-on-AI-data-centers-as-PGE-reports-thousands-of-megawatts-in-queue","https://secure.pipeline.soar.com/6155187-b00254116ce28789ed06174f6bb8bc10/orig.mp4?Expires=1770453758&Signature=b6Yg1Ohup1p~9ya9sDdTtc-xYaOU1E4w6dF6ZMN3q9JmRaGBzFRQcNrl~n~bU-oMfyCkw7oRx-zYvrvwLW1C-ot32Ouw5A9GZxWZH0d16I~kGzVXJASjanmn9Ewk-cYRbDz2ZEZcYNkPHr3TzuGHbY~bQrhKv9mcVCdbh4chlVaj7vK4Mp2Ub~k1HmnXnlGoDWIS5nYj5dMOgpg1X32imkVZ-oqTEatUxCqV488ysAI61424IEm4XcVZZ~EyETh-x-045roxF4fPee1wMLarv78SwiOMD4m0Z8upvViLqZNBaKagJGu~F7J2UBNwkfB~lxz23ixS1aghilqgRTWxtg__&Key-Pair-Id=KUT5TJCACFTXG","Luam Tesfaye of the California Public Utilities Commission told the Little Hoover Commission that the agency is tracking rapid growth in large new loads, particularly data centers that support artificial intelligence, and that “in PG&E's territory... they had about 4,000 megawatts in the queue” late last year and “now they have 14,000 megawatts in the queue.” She said the CPUC has put an interim tariff in place for large loads (PG&E's Tariff Rule 30) to standardize information and accelerate interconnection, and that the commission's next step will be to examine cost allocation for those customers.

Why it matters: Witnesses and commissioners expressed concern about the pace and scale of data-center buildout and how costs for new interconnections, transmission upgrades and possible stranded assets would be allocated between large commercial users and other ratepayers. Commissioners urged the CPUC to ensure protections so existing ratepayers do not bear disproportionate costs if large customers leave or their load profiles change.

Details and steps: Tesfaye described the CPUC's phased approach for PG&E territory: create a standardized application/tariff element to obtain reliable load and interconnection information, then move to a second phase focused on allocating costs and avoiding stranded assets. She acknowledged confidentiality concerns from companies about sharing detailed load profiles but said “there's some basic information we need to be able to get.” She also said potential benefits from adding new large load exist because more consumption can spread fixed costs across a larger kWh base, but cautioned the outcome depends on where and how the new load connects and whether interconnection costs are socialized.

Questions from commissioners: Several commissioners pressed witnesses on whether utilities can refuse new connections and on whether a distinct rate class for data centers might be needed. Tesfaye and other witnesses said denial is unlikely but timing or required upgrades could delay interconnection; the CPUC would consider specific rate design and cost-allocation options in upcoming proceedings.

Public advocates: Michael Campbell of the Public Advocates Office said the effect of additional load on rates depends on \"the when, the where, and the how\" and warned policymakers to avoid simplistic assumptions that more load will always produce lower rates. He noted data-center projects can be easily moved and stressed the need for safeguards so ratepayers are not left covering upgrades if customers depart.

What did not happen at the hearing: The meeting did not approve new tariffs or adopt a specific cost-allocation rule. Testimony described open proceedings at the CPUC and the agency's intention to study and, if necessary, propose allocation changes.","Witnesses told the Little Hoover Commission that rapid growth in AI and data-center load is straining grid planning. The CPUC is considering an interim PG&E tariff (Rule 30) to standardize interconnection and said it will study cost allocation and rate design for large new loads.",{"_33":101,"_35":36,"_37":38,"_39":102,"_41":103,"_43":104,"_45":105,"_47":106,"_49":107,"_51":108,"_53":109,"_55":56,"_57":58,"_59":110,"_61":62,"_63":64,"_65":111,"_67":68,"_69":70,"_71":72,"_73":74,"_75":74},6155192,"CPUC: rooftop solar tariffs and wildfire costs are top drivers of rising bills; opens rulemaking on climate credit",1156,294000,1450000,"/Search/View?dp=1&key=5480678-d128d65ac9e26e8f2ef633b92e790f74&start=294&end=1450","https://assets.pipeline.soar.com/5480678-d128d65ac9e26e8f2ef633b92e790f74/thumbnail_294000.jpg","/articles/6155192/California/CPUC-rooftop-solar-tariffs-and-wildfire-costs-are-top-drivers-of-rising-bills-opens-rulemaking-on-climate-credit","https://secure.pipeline.soar.com/6155192-7c6c306a92e5deae3680c3edbf9556b4/orig.mp4?Expires=1770453758&Signature=VqPYJ9RZt~EhIqIM~DON~CRaiPBJ2AMST8SgGOkZP8lF3Grslzh7K45kW6WrKZxM-qNSX6XJq9Ak1Dg170jsx9SAw7bQDd5RAqMwZlv~MNFF3IMddn5pZYUDse9JlXWszT2f7PbrTHP3xhJdd50Yd18N2Tj~xzTgE~ztJM9srZSrWLwmqq--eo9f0k6EEEDgQ-l7Y6ZCJy6N8wcqqz6O8RcW3l8AYYeJ2U04hBwV89EOXQ6OuqFPSorrwsMSoezvTurbCo8nw~GwyA87ry2qiKPo~lvvGHL2h1LPIFIcVvL3xjRe5ubb9aCUg6W-zePUI32Cbt6eBVa3tmklPvyo1g__&Key-Pair-Id=KUT5TJCACFTXG","Luam Tesfaye, deputy executive director for energy and climate policy at the California Public Utilities Commission, told the Little Hoover Commission on July 24 that the CPUC views rooftop solar tariff design and wildfire-related costs as “the 2 largest drivers of electric rates today.” Tesfaye described the CPUC analysis conducted after Governor Newsom's Executive Order N-5-2024 directing work on electric bill affordability and presented several possible responses, including moving some program costs off utility rates and reallocating the state's climate credit.

Why it matters: The CPUC said the combination of long-term capital investments in transmission and distribution, wildfire mitigation spending and the continuing presence of legacy net energy metering (NEM) customers has pushed fixed system costs onto customers who do not avoid usage. Tesfaye said there is “no silver bullet” to reduce rates but the agency is pursuing several changes the commission believes can slow rate growth.

Most important facts: Tesfaye explained that many customers remain on older NEM tariffs and therefore continue to shift fixed costs to nonparticipating customers. She described the CPUC's prior action to adopt a net billing tariff in 2022 to reduce that cost shift going forward, but emphasized the change was not retroactive. Tesfaye also said wildfire mitigation investments have largely been treated outside the utility general rate cases and recommended integrating wildfire spending forecasts into general rate case proceedings to provide fuller scrutiny.

Climate credit and rulemaking: Tesfaye laid out options for reallocating the climate credit (the twice-yearly customer credit tied to the state's cap-and-trade program). She said the current credit is about $120 per year, typically paid in two installments, and described alternatives that would direct the credit toward low-income customers, customers without rooftop solar or customers in the state's hottest climate zones. Tesfaye told the commission that “the Commission is taking action to open a rulemaking to look at this opportunity with the climate credit,” which she said would invite stakeholders to propose and vet ways the credit could be targeted to improve affordability.

Limits and dependencies: Tesfaye said the investor-owned utilities will need to collect roughly $44 billion from customers this year to build and operate the system and that many program costs are embedded in long-term investments. She also noted some programs are not required to be cost-effective and said the CPUC has been applying a consistent cost-effectiveness test to better understand cost shifts.

What the CPUC did not decide at the hearing: Tesfaye presented recommendations and said the CPUC will open a rulemaking; the hearing did not adopt any change to tariffs, reallocate funds, or alter statutory program funding. She also noted opportunities to leverage non-ratepayer funding sources such as the General Fund and Greenhouse Gas Reduction Fund, but said there is currently no line item in the state budget for rate discounts.","At a Little Hoover Commission hearing, the California Public Utilities Commission told commissioners that rooftop solar tariffs and wildfire-related costs are the two largest drivers of rising electricity rates, and said it is opening a rulemaking to study reallocating the state's climate credit to help lower bills for vulnerable customers.","actionData","errors"]

Article not found

Public Advocates Office urges stricter cost scrutiny, rethought rate design to ease bill increases

California Energy Commission: efficiency rules and programs deliver large net savings and should be preserved

Commissioners press CPUC on AI data centers as PG&E reports thousands of megawatts in queue

CPUC: rooftop solar tariffs and wildfire costs are top drivers of rising bills; opens rulemaking on climate credit