Utility Bills Rise as PUC Juggles Rates

The bad news was that residential electricity will cost about $3 more per month in 1985. The good news was that gas costs will drop by about $2.

That was the New Year’s Eve ruling by the state Public Utilities Commission, which decided Monday exactly how its previously announced rate changes would be distributed to San Diego Gas & Electric Co. customers.

The ruling means that, starting today, the typical residential customer of SDG&E; will pay about $1.03 per month more for energy, with the average bill rising to $67.40.

In addition, SDG&E; will pass on a $14.4 million, one-time refund that will decrease January gas bills by $9.30.

For the typical customer using 400 kilowatt hours of electricity per month, the electricity bill will rise to $48.71 from $45.62, an increase of nearly 7%. That’s how the PUC decided to divvy up SDG&E;’s $73.4 million per year electricity increase, which was approved by the commission on Dec. 19.

For the typical gas customer using 40 therms per month, the gas bill will drop to $18.69 from its present $20.75, a decrease of about 10%. SDG&E;’s total gas rates will drop by $46.7 million in 1985.

Complex Cases

Both the electric and gas rates were derived from several complex SDG&E; cases pending before the PUC.

On the electricity side, the $73.4-million increase is the result of three separate PUC rulings: an increase of $84 million for costs related to the San Onofre Nuclear Generating Station Units II and III, a $14.1-million increase pegged to inflation and a $24.7 million decrease in rates for fuel-related costs.

Last month’s PUC ruling that SDG&E; be fined $45.1 million because of its “unreasonable” decision in 1978 to extend a fuel oil contract was reflected in the $24.7-million decrease. The net decrease is the difference between the fine and a fuel-cost increase of $20.4 million.

The gas decrease of $46.7 million is the result of a cost-of-gas decrease of $53.2 million plus a $6.5 million “attrition” increase that deals with inflation.

SDG&E; officials had estimated two weeks ago that the PUC rulings would increase the typical residential energy bill by 70 cents per month--considerably less than the $1.03 hike announced Monday.

Different Design

But the PUC “adopted a slightly different rate design than we had proposed,” Doug Hansen, manager of rates, said Monday. The PUC, concerned that large business customers may seek alternative energy sources if gas prices rise too much, gave a larger percentage of the gas decrease to SDG&E;’s commercial and industrial customers than the utility had requested.

The PUC also adopted an incentive for management of San Onofre Unit III whereby the utility’s earnings will be penalized--and the loss borne by shareholders, not ratepayers--when Unit III operates at less than 55% of its annual potential output and rewarded when it operates at more than 80%.

Despite the monthly increase, the average residential bills this year are still below 1983’s typical energy tab. In December, 1983, San Diegans paid an average $72.75 per month for gas and electricity.