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PG&E Rates Could Drastically Change Based on Your Income

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Re: PG&E Rates Could Drastically Change Based on Your Income

#21

Post by zen_1 »

zamalek wrote: post #18
balderdash wrote: post #13

Isn’t this just going to incentivize the people can afford to, to install residential solar/battery and go off grid? Which probably has negative consequences for the low/moderate income people who will have to share a larger portion of the fixed costs?

Technology Connections has a really interesting (as always) video on this. Supposedly 10-20% of your power bill goes to power, the rest is for grid maintenance. The poor are going to have to pay more and more to maintain the grid, unless there is a radical change in how grid-tied is priced.

Off topic, but your username made me do a double take, wasn't expecting a name from my hometown to pop up as a HN user

Re: PG&E Rates Could Drastically Change Based on Your Income

#22

Post by raylad »

This is a horrible proposal. Whether or not you are upset about PG&E knowing your income, the mere fact that it would be a flat rate reduces or eliminates the incentive to reduce electricity usage.

If this goes through, we will probably see people running their AC and heat more because there's no incremental cost for them to do so.

We need to be incentivizing reduction in energy use, not making it free to use more.

Re: PG&E Rates Could Drastically Change Based on Your Income

#23

Post by noodlesUK »

I think that having energy be more affordable for people who are less well off makes sense. What this article seems to suggest is making electricity unmetered and cost a fixed amount based on your income. This completely discourages people to be economical about saving energy. Rich people already tend to use their heating and AC more than poorer people. We should not incentivize people to be inefficient. Adjusting a unit price would be reasonable, but people should be charged just that — a unit price.

Re: PG&E Rates Could Drastically Change Based on Your Income

#24

Post by zamnos »

thegrim33 wrote: post #14
gbtw wrote: post #3

So rich people who can afford their accountant fees to hide their income, like with taxes, will pay almost nothing for energy, while the essentially broke person will pay more.

What percentage of the population do you believe is both rich and hires accountants to hide all of their income? What percentage of people serviced by PG&E do you think fall into that category? From my perspective you're referring to a number of people that I could count on one hand. Do you think it's some significant portion of the population?

Presume that everyone making above, say, $1 million per year isn't taking all their income as W2 income. How much this counts as "hiding" income is up to you to decide, but generally W2 is considered "normal people" income, 1099 "contractor people" income (whether that's a plumber who owns their own business, or an Uber driver), and 1099-DIV and 1099-INT and related are rich people incomes.

If we further assume big tech companies have 5 CxO (CEO, CFO, CTO, COO, CISO, CMO; pick 5), and that there are more than 1 big tech companies headquartered in California. If we assume those officers make large incomes that aren't W2 incomes, that they live in California, and, further, live in areas serviced by PG&E (which, statistically speaking is basically all of them), and then count individuals based on the fraction of income "hidden" as non-W2 income, and sum them up, then that number is surely greater than 5.

Not a statically significant portion of the 17M employed Californians mind you, but more than 5.

Re: PG&E Rates Could Drastically Change Based on Your Income

#25

Post by Plasmoid »

raylad wrote: post #22

This is a horrible proposal. Whether or not you are upset about PG&E knowing your income, the mere fact that it would be a flat rate reduces or eliminates the incentive to reduce electricity usage. If this goes through, we will probably see people running their AC and heat more because there's no incremental cost for them to do so. We need to be incentivizing reduction in energy use, not making it free to use more.

The article is bad. It's not switching to flat rate, it's raising the stand-by charge and reducing the per-unit cost of energy.

So it will definitely encourage more consumption but it's not the complete lunacy of flat rate electricity.

Re: PG&E Rates Could Drastically Change Based on Your Income

#26

Post by hedora »

Ok, $92/month is $11,400 for ten years.

It would cost me about twice that to upgrade my current solar and battery for 100% off grid. ($10K would go to a backup generator that we need anyway because PG&E pulls about 1 nine of reliability around here).

So, if this proposal passes, I’ll strongly consider just not paying for electrical service anymore. I suspect most high income houses will be looking at similar numbers as the cost of solar plus battery continues to drop.

This will only accelerate California’s power grid death spiral.

Edit: They should make the variable part of your electric bill proportional to carbon footprint (negative bills for net negative housholds), and legalize community net metering. This would allow poor people to buy into non-profits that lower their bills, so they could benefit economically form solar panels, just like rich people do. Also, this would even more rapidly decarbonize California’s power grid.

They could make it revenue neutral for PG&E by raising the base rate for interconnect, by giving PG&E cap and trade credits, or by giving individuals the cap and trade credits in lieu of a discount off their bills.

Re: PG&E Rates Could Drastically Change Based on Your Income

#28

Post by prepend »

pengaru wrote: post #20

What business does the power company have knowing my income level? I already get offers to sign up for substantial low-income discounts from SCE, and it never strikes me as a good idea to pursue despite likely qualifying on my long sabbatical style stints of self-employment. My usage is so low in general it's just not an optimization worth further compromising my privacy for. Furthermore why would we want to disconne…

It’s not just income but all residents too. Will everyone’s grandma be on the power bill? What is there are two earners filing separately? Or four roommates?

Re: PG&E Rates Could Drastically Change Based on Your Income

#29

Post by probablypower »

zamalek wrote: post #18
balderdash wrote: post #13

Isn’t this just going to incentivize the people can afford to, to install residential solar/battery and go off grid? Which probably has negative consequences for the low/moderate income people who will have to share a larger portion of the fixed costs?

Technology Connections has a really interesting (as always) video on this. Supposedly 10-20% of your power bill goes to power, the rest is for grid maintenance. The poor are going to have to pay more and more to maintain the grid, unless there is a radical change in how grid-tied is priced.

This is kind of on the right track, but not correct.

The breakdown varies wildly depending on which electrical market you're in, and where in that market you're physically located. The price you pay is mostly a combination of:

- Wholesale energy prices set by multiple markets (week ahead, day ahead, balancing) - Market fees (minimal) - TSO/ISO tariffs for running the transmission grid and any ancillary services, as well as grid maintenance and capital recovery - Similar DSO tariffs for the distribution grid - retail costs that represent the overhead of any electricity retailer that exists between you and the DSO - taxes and other fees depending on your state

In my country, the wholesale cost is approximately 60%, TSO and DSO fees are around 10-15% each, retail is around 5% and other fees and taxes make up the rest. My numbers are loose because it has been 4 years since I broke it all down last.

Your underlying point is right though, that richer people can afford to buy their own production to avoid most of these fees. The result being that poor people shoulder more of the cost.

Re: PG&E Rates Could Drastically Change Based on Your Income

#30

Post by mistrial9 »

say_it_as_it_is wrote: post #27

The rich don't pay any taxes so they probably won't pay anything for utilities under this policy

this is incorrect -- many large income earners in California pay tons of taxes. And also, many low income earner pay tons of taxes. In a famous experiment, a dozen professional tax prepares were paid to do their best with some (hypothetical) tax situations, and their results were significantly different. IIR the IRS itself was asked to calculate the tax, and it was different again.

Computer programmers in particular might be forgiven for incredulity of these tax systems, but here we are in 2023.

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