Will the new rate structure for the customers of Sweetwater Authority and for all customers of San Diego Gas & Electric punish low-income and conservation-minded people? Comments by two politicians —National City Mayor Ron Morrison and San Diego City Council member David Alvarez, suggest these two groups are going to feel the love when utility bills come due in October.

As of September 1, both SDG&E and Sweetwater Authority’s new rate structures went into effect and are almost the reverse of what they were initially.

In 2000, SDG&E introduced a four-tiered system similar to the tiered rate introduced by Sweetwater Authority in 2010. In both rate structures, Tier One users, those who use the least, were charged the least, while Tier Four users, those who used the most, were charged the most.
In both cases, high-use consumers have pressured the respective companies to ameliorate their situations through a restructured rate system. High use consumers of gas and electricity have argued that people who live in the East County where temperatures vary more radically, or people with large families are unfairly punished. High-use water consumers have similarly argued that people with large families or lots are being unfairly penalized.

The California Public Utilities Commission recently voted to allow SDG&E to flatten their four tiers into two tiers beginning September 2015 and finishing in March 2016.
As the tiers are eliminated, the lower energy users will pay more while the higher energy users will pay less. SDG&E will also raise the minimum monthly bill for everyone except those with special needs from $5.00 to $10.00.

In addition to that hike, according to the SDG&E website, by 2019 SDG&E “residential customers will be automatically defaulted to “time of use” (TOU) rates. This means the price of electricity will depend on the time of day people use energy….”

Amber Albrecht, media spokesperson for SDG&E, says neither the window period for the time-of-use rate change, nor the rate itself have been established. She said the Public Utilities Commission is currently looking into the rates and time of day which will be monitored by the smart meters.
Albrecht also said there is currently an option to enroll in a time-of-day-use plan which might save some customers money. She also said if customers refer to a recently launched website, SDG&Emarketplace.com, they will find an array of energy efficient products with rebates.

When this SDG&E rate change was first proposed, City Council member David Alvarez said: “This change to the rate structure means that San Diegans who currently pay based on being in the first or second tiers (low energy users), will experience an average 16% increase in their electricity bill.
“Consumers of large amounts of energy, who pay based on being in the third and fourth tiers will receive a reduction in costs of nearly 30%. This punishes those San Diegans that are most effective at conserving energy while rewarding those that are not….The bottom line is these changes to SDG&E’s residential electricity tariff structure will hurt the city’s Climate Action Plan goals, puts low-income customers at a disadvantage, and punishes customers that are conserving energy.”
Several critics have pointed out that those who have converted to solar power to reduce consumption will now be subject to higher rates.

A similar inversion of the rate structure happened with Sweetwater Authority, which provides water for residents in National City, Bonita, and western Chula Vista. On August 31 the water Authority passed a restructured tier rate for consumers. Tier One’s increase, for the lowest water users will increase 38% per 748 gallons; Tier Four rates, which are for the highest users, will experience a 16% decrease per 748 gallons.

It is striking how National City Mayor Ron Morrison’s comments about the restructuring of Sweetwater Authority’s water rates mirror the comments of Alvarez about SDG&E rate restructuring.
On August 31, when Sweetwater Authority voted to increase the water rates by 5% across the board and to restructure the tiers, three members voted against the rate hike. Morrison was one of the three. He explained his vote in a September 11 interview:

“My [opposition] vote was a little bit different than the other two, basically I felt it [rate re-structuring] was kind of an anti-conservation move, it was deliberately geared toward lowering the rates for people that use a lot of water and low water users which are basically, for the most part western Chula Vista and National City, they have lower water users, Bonita has larger water users, it ends up lowering the rates on the lower water users and raising the rates on the high water users. In the middle of a drought that makes no sense at all.”

Morrison went on to say that while he favored the 5% increase because the reservoir is out of water and the Authority needs the money to purchase more water, he opposed the way the rates were re-structured:

“For the most part the higher water users are going to get a reduction in the bill they used to have, the 5% isn’t even going to affect them at all, and so the people at the lower end are going to take the brunt, not only 5% but the 5% across the board, so they’re going to have to make up for the high water users and they’re going to get their rate as their tiers raise up drastically, and so it’s going to be a double whammy on the lower water users. Higher water users are going to be able to use more water than they used before at the same rate which again makes no sense at all.”