SDG&E; Official Predicts Lower Utility Rates

San Diego Gas & Electric officials predicted Thursday that the availability of lower-priced energy sources and lower interest rates will help generate lower utility rates in the foreseeable future.

“We have reason to be optimistic about the future,” Lee Haney, SDG&E; vice president and treasurer, said at a Thursday press conference that focused on utility rates. “By the end of the year, rates will be lower than they are now.”

SDG&E;’s rates have declined by 9% since 1983, according to SDG&E.; The typical residential customer--who uses 400 kilowatt hours of electricity and 40 therms of gas per month--is now paying $66.19 per month, compared to $72.75 per month for gas and electric service in October, 1983, when utility rates hit their highest point. In August, the typical customer paid $66.37 per month.

During that period, SDG&E;’s rates have “fallen from about first or second to about sixth” highest among U.S. cities, Haney said.

That drop was caused in part by the utility switching from its previous reliance on fuel oil and natural gas to a fuel mix that relies on nuclear energy and energy that is purchased under long-term contracts with other utilities.

SDG&E; officials said electric rates could go lower after transmission lines linking the utility with other utilities are upgraded. Those links will allow SDG&E; to purchase more of the lower-cost electricity that is generated by hydroelectric and coal-fired plants, an official said.