Continued Slide in Rates Predicted by SDG&E; Chief
San Diego Gas & Electric’s average monthly residential bill will continue to drift slowly downward for the rest of this year and 1989, Thomas Page, the utility’s chairman and president, said Tuesday.
If Page’s prediction holds true, SDG&E; will be able to boast of a six-year string of residential rate decreases since the utility’s average monthly residential bill hit an all-time high of $72.75 in December, 1983.
SDG&E;’s average residential bill (based on the use of 400 kilowatt-hours of electricity and 40 therms of natural gas) was $60.19 at the start of 1988. Page predicted that the average bill will hover about $60 a month during 1989.
Page’s prediction is based on electric rates, which are expected to dip slightly through the end of 1988, and natural-gas rates, which are expected to increase slightly during the next two years.
During his sixth annual rate-prediction press conference, Page admitted that he remains frustrated because “the average person still seems to have the feeling that (rates) have been going up.”
“Our rates have been coming down for four years, and they’re going to be going down for (a total of) six years,” Page said. “But the perception is that they’re not going down.”
Page also said he is tired of “being the high-cost (electricity supplier) in California (and) in the West.”
Within “a couple of years (SDG&E; is) . . . not going to be the high-cost producer,” Page promised. “As our rates are going down, the rates of other utilities are going up.”
The predicted 1989 electric rate decrease is expected to be fueled largely by an unprecedented agreement signed Tuesday by SDG&E; and the state Public Utilities Commission’s staff. That agreement, also signed by the City of San Diego and the Navy, would require SDG&E; to cut its operating and maintenance costs enough to allow a $43-million rate reduction.
About $1.25 a Month Cut
That $43-million reduction would translate into an estimated $1.25 per month reduction in the average residential bill.
The agreement must be approved by the PUC. Also, the PUC’s Division of Ratepayer Advocates and the utility failed to reach agreement on several key parts of the general rate case.
Consequently, if the PUC were to accept its staff recommendation, SDG&E;’s revenue base would be reduced by $76 million, beginning in 1989.
The agreement signed Tuesday came at the outset of a general rate case proceeding to determine SDG&E;’s allowable revenue for the three-year period beginning Jan. 1, 1989.
As part of that proceeding, one PUC member will be in San Diego next week to chair public hearings on SDG&E;’s rates and performance. Monday hearings will be at 2 p.m. and 7 p.m. at the County Administration Center, 1600 Pacific Highway. Tuesday’s hearing will be at 7 p.m. at Escondido City Hall.
