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California regulators approve a revision to how power bills are calculated in response to rising electricity demand

Demand is expected to rise (Via John Cusak/Shutterstock)

California regulators voted on Thursday to reduce costs for charging electric cars and cooling homes during summer, marking a step in the state’s shift towards clean energy. However, critics argue it may increase expenses for lower-energy users.

The decision by the California Public Utilities Commission allows major utilities such as Pacific Gas & Electric to impose a fixed monthly charge on electricity bills. This charge, set at $24.15 for most customers starting late next year, covers the installation and upkeep of electricity transmission equipment. Lower-income customers enrolled in discount programs will pay reduced rates of either $6 or $12 per month.

In exchange for this new charge, the cost of electricity will decrease by 5 to 7 cents per kilowatt hour. A kilowatt hour measures the energy needed to power a 1,000-watt appliance, like a coffee maker or vacuum cleaner, for one hour.

Utility crews repair overhead lines (Via John Cusak/Shutterstock)

California currently relies heavily on renewable energy sources like solar and wind power instead of fossil fuels such as coal, aiming to reduce air pollution. State leaders emphasize the importance of using more electricity to meet climate goals. In 2022, California accounted for 37% of the nation’s electric vehicles, significantly more than any other state.

The state has also implemented policies encouraging residents to electrify their homes by installing appliances like heat pumps and stoves powered by electricity.

Alice Reynolds, president of the California Public Utilities Commission, stressed the need to increase electricity usage to achieve climate objectives.

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