A change of plans
California electric utility to charge more for power during peak times for randomly selected users
Starting this month, Southern California Edison is sending letters to 400,000 randomly selected customers who will be switched to time-of-use rate plans starting in March. For more on this story,
Over the next two years, California electric utilities will switch most residential customers to payment plans that charge more for using power during peak hours and less when demand is lower.
Starting this month, Southern California Edison is sending letters to 400,000 randomly selected customers, including some in Santa Clarita, who will be switched to time-ofuse rate plans starting in March. The rest of SCE’s 4.3 million residential customers will be switched over the next two years.
Time-of-use billing isn’t new, said Kari Gardner, senior manager of consumer affairs with SCE. “We’ve offered time-of-use for years and years, and it’s very simple for customers to make the change. They can call us and the switch will take effect in their next billing cycle.”
What is new is that the payment system will become the default method of billing for electricity across the state. The transition is part of a statewide initiative. At the direction of the state’s Public Utilities Commission, all three of California’s investor-owned utilities are switching eligible customers to time-ofuse rate plans in phases between 2018 and 2020.
The idea behind time-of-use rates is to give customers an incentive to switch some or most of their electricity use, if possible, to off-peak or super off-peak periods by offering lower rates during those times of day. Electricity rates are lower on nights and weekends and higher during weekday daytime hours.
SCE customers enrolled in income-qualified bill assistance programs — such as the California Alternate Rates for Energy (CARE) and the Family Electric Rate Assistance (FERA) programs — will continue receiving bill discounts if they choose a time-of-use rate plan.
And customers enrolled in SCE’s Medical Baseline program for customers who need powered medical equipment in their homes won’t be switched to time-of-use rates at any time. Customers who live in desert “hot zones” as designated by the PUC, and are enrolled in one of SCE’s income-qualified programs, will also be exempted.
Participants will be transitioned to one of two time-of-use rate plan options. In one, the on-peak period is 4-9 p.m. on weekdays. In the other, the on-peak period is 5-8 p.m. on weekdays, which is slightly more costly during the shorter peak time. There are no on-peak periods on weekends, only midpeak, off-peak and super off-peak periods.
The timing of the peak period was shifted to start an hour later to reflect the growing supply of solar power during the hours of peak sunshine.
“From noon to about four in the afternoon, there is an excess of solar energy,” Gardner said. “As that declines through the late afternoon into the evening, we have to ramp up conventional power generation sources.”
Seeking efficiency
Overall, SCE expects yearly energy expenses to be lower for many customers, although bills may be higher in the summer.
“Once a customer has made the transition, there is a 12-month rate protection guarantee, meaning the customer will not pay more than they would have without the change,” Gardner said. “If the standard rate was less than the new rate, SCE will make up the difference.”
She said SCE offers a number of online tools to help customers keep track of how and when they use electricity.
The overall goals of the program are to drive energy efficiency and help control electricity costs as utilities move to more renewable generating sources.
“Right now, solar represents about 10 percent of our overall generating capacity, and roughly 25 to 30 percent come from renewable sources,” Gardner said. “State law in California will require us to produce one-third of our power from renewable sources by 2020 and one half by 2030, and we are on track to achieve both those goals.”