How will California stop skyrocketing utility bills?
Many Californians are still grappling with the hit to their wallets from the costs of, well, everything. That includes shockingly high natural gas bills, which have spiked to double the usual or more due to a cascade of issues: increased demand brought on by cold weather, tightened supply, pipeline and storage problems.
Gov. Gavin Newsom has called on federal regulators to investigate, while Senate Republicans have been hammering Newsom and Democrats on the issue. The California Public Utilities Commission voted to expedite climate credit payments to consumers. Still, lawmakers say they’ve been inundated with calls for help from their constituents — residents and businesses alike. And some gas companies, including Southern California Gas, are seeking to increase their rates next year.
It gets worse for consumers: The cost of natural gas is likely to lead to increased electricity bills this summer because some utilities use natural gas in their power plants.
So Tuesday, during the second part of their annual hearing with the California Public Utilities Commission, members of the Senate’s Committee on Energy, Utilities and Communications committee focused on the increased cost of electricity and how the state can avoid future price spikes.
- Sen. Steven Bradford, a Democrat from San Pedro and committee chairperson: “We can no longer count on mild weather and energy efficiency alone to limit the impact of utility bills … While I’m encouraged the PUC has advanced the climate credit and the governor has called on the federal government to investigate, I don’t yet have the confidence that our residents won’t be in this situation again.”
Keeping electricity affordable is crucial as the state tries to transition off fossil fuels to cleaner energy.
Among the key factors identified by state regulators and utility company representatives: the cost of transmission and distribution, such as upgrading aging infrastructure, and higher demand driven by economic activity. Another factor: measures to prevent wildfires, some mandated by state laws, with costs passed on to consumers.
Consumer advocates pushed back, though, noting that PG&E, for example, may have overestimated some of those mitigation costs in its rate increase request because they are based on “historical costs incurred from the worst fire safety failures in PG&E’s history.”
- Linda Serizawa, deputy director for energy with the utilities commission’s public advocate office: “The forecasted costs are far higher than they should be going forward, given that PG&E presumably has learned from its past and ongoing wildfire mitigation efforts.”
Severin Borenstein, faculty director of the Energy Institute at UC Berkeley’s Haas School of Business, told CalMatters that the state should end “inverse condemnation,” which forces public utilities to pay for wildfires even when they’re not at fault, and promote more competitive bidding on infrastructure projects.
- Borenstein added: “If we’re going to recognize a climate emergency in California, let’s pay for it through the state budget, not through raising rates. That both hurts poor people and undermines the goal of decarbonization.”
Lawmakers and advocates also called for a look into solar tax incentives and whether they only subsidize electricity for the wealthy.
Utilities commission officials said one method they are pursuing to lower costs for some families is an income-based fixed rate program. They also agreed to look into making sure assistance programs reach senior citizens and non-English speakers.
Wage theft: CalMatters’ California Divide team wrote a comprehensive series on wage theft, including stories on how long workers wait for back pay, the struggles at the state agency in charge and nonprofits trying to help. There’s a Spanish-language version of an explainer. Read and share it here.
Other Stories You Should Know
1 The ‘Race to Zero,’ part 2
From CalMatters environment reporter Julie Cart:
If California, and the nation, are to meet an ambitious mandate to electrify cars, a great transformation is required — a revolution led by chemists. And electrical engineers. And experts in rare earth metals.
The next-generation electric car is all about creating newer, better batteries. It’s a knotty problem that’s the focus of the second story in CalMatters’ groundbreaking series “Race to Zero: California’s bumpy road to electrify cars and trucks.”
As California enforces its first-in-the-world zero-emission requirements for cars, the state is navigating a policy path strewn with unique obstacles: international human rights and environmental issues, global resource constraints and fast-moving technologies.
The industry’s imperatives: Making cheaper, faster-charging and more durable EV batteries. Breaking China’s stranglehold on the industry, where 85% of batteries are produced or assembled. And discovering new sources of rare earth minerals to replace lithium mines in countries with unsafe labor practices and poor environmental oversight, and cobalt mines where human rights groups say children are mining ore with their bare hands.
The outlook offers a mixed picture:
- Daniel Sperling, a professor at the UC Davis Institute of Transportation Studies and former longtime Air Resources Board member: “The American automobile industry has lagged and has been slow to embrace adoption of EVs, never mind the materials issues. The legacy companies, not just the American ones, have been slow to anticipate all the issues — supply chain, materials. We thought that all of this would be so easy a glide path to 100%.”
- The International Energy Agency, in a sobering snapshot: “These risks to the reliability, affordability and sustainability of mineral supply are manageable, but they are real. How policy makers and companies respond will determine whether critical minerals are a vital enabler for clean energy transitions, or a bottleneck in the process.”
Electric vehicles: Julie’s story is the second in a series on California’s road to more electric cars and trucks. Starting in 2035, no gas-powered vehicles will be sold in the state. Do you have questions about this transformation? Submit them here.
2 Slow progress on housing
State legislators have passed nearly 100 laws in the last six years, invested billions of dollars and cracked down on local governments — all to make a dent in California’s affordable housing crisis.
What has it accomplished? The answer probably isn’t what lawmakers wanted to hear.
Bottom line: Housing is still unaffordable and production of new units remains relatively stagnant, the Terner Center for Housing Innovation at UC Berkeley told a joint hearing Tuesday of the Assembly and Senate housing committees.
The report does contain some good news: New affordable housing subsidies are producing about 20,000 units a year. A highly contentious law passed in 2017 seems to be working, with lower-income families targeted in nearly 75% of proposed units. And the number of permits for accessory dwelling units has increased from 2,100 in 2016 to about 21,000 in 2021.
But Terner says that it’s too soon to tell whether the housing laws — even with stricter enforcement by the state — will make a real difference, especially when labor, materials, impact fees and other costs remain untouched.
Meanwhile, one popular villain in the housing crisis — the landmark 1970 California Environmental Quality Act — is back in the headlines and squarely in the sights of critics. This time, it’s the use of CEQA to block student housing at UC Berkeley.
And on Monday, the Little Hoover Commission, a citizens watchdog group, announced it will “examine the controversy around CEQA,” including its impact on housing, in a series of hearings starting March 16.
3 CA’s nursing pipeline problem
California faces a dire nursing shortage. A 2022 study from UCSF estimates the state will fall short by almost 19,000 full-time nurses by the end of the year, with the shortage continuing until 2029. At the same time, it is exceptionally difficult to get into a nursing program in the state.
At Ventura College, for example, the waitlist for the nursing program sits at four-and-a-half years. And at the school of nursing at Cal State Fullerton, about 8,000 applicants compete for 100 spots.
So why isn’t the state preparing more nursing students?
In the first installment of “Ask CJN,” CalMatters College Journalism Network fellow Megan Tagami spoke to professors and program directors at Cal State and the California Community Colleges, who explain the two major forces limiting the capacity of nursing programs.
Have a question about California higher education? Fill out this form and it could be addressed in a future “Ask CJN.”
CalMatters columnist Dan Walters: A new appellate court decision affecting UC Berkeley has once again revived talk about reforming the landmark California Environmental Quality Act, but how far are Newsom and the Legislature willing to go?
California is wrong to cut public health money as the COVID-19 emergency ends, argue Kim Saruwatari, president of the County Health Executives Association of California and public health director for Riverside County, and Nancy Williams, president of the Health Officers Association of California and public health officer for El Dorado County.
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Community workers fan out to persuade immigrant seniors to get covered // California Healthline
California community colleges rely too much on part-time faculty, audit finds // EdSource
L.A.’s scoring system for subsidized housing penalizes Black and Latino applicants // The Markup
Some cities can’t stop apartment projects as developers use ‘builder’s remedy’ // Orange County Register
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Newsom rescinds California’s COVID-19 state of emergency // Los Angeles Times
Tesla pauses rollout of driving software after U.S. recall // Los Angeles Times
A family seeks answers and accountability after Black mom dies in childbirth // LAist
SF crackdown brings back troubled cops, dubious covert tactics // San Francisco Standard
Montenegro extradites U.S. fugitive in Los Angeles COVID scam // Los Angeles Times
Opinion: Uber and Lyft ‘deactivations’ are unfair to drivers // Los Angeles Times