SDG&E;’s Electrical Rates to Drop by 10.7% in ’89

New electricity rates approved Monday by the state Public Utilities Commission mean that San Diego Gas & Electric’s average rates--long among the nation’s highest--will dip Jan. 1 below those charged by Southern California Edison and Pacific Gas & Electric.

SDG&E;’s systemwide rates--the average of all industrial, commercial and residential rates--for electricity will fall by 10.7%, or $124 million, during 1989, according to SDG&E; Pricing Manager Doug Hansen.

However, most of the reduction has been earmarked for SDG&E;’s commercial and industrial customers to offset previous rate increases that subsidized lower rates for SDG&E;’s residential customers, PUC spokeswoman Carol Kretzer said Monday.

Average monthly bills paid by SDG&E;’s residential customers (based on the use of 500 kilowatts of electricity) will remain slightly higher than bills paid by Edison’s customers, Hansen said.

When the new rates take effect Jan. 1, SDG&E;’s average monthly residential electric bill will fall by about 7%, to $52.50, while Edison’s typical residential bill will rise by about 1%, to $49.50, Hansen said.

Action Expected

Edison officials have maintained that Monday’s rate activity, which had been expected for some time, would not necessarily affect the 10% rate decrease request that Edison Chairman Howard Allen has pledged to file with the PUC should the merger between Edison and SDG&E; be completed.

However, Michael Shames, executive director of Utility Consumers Action Network, a San Diego-based consumer group, suggested that the lower rates might prove to be short-lived. “The lower rates are tainted by the reality that, if the merger goes through, they may not stay lower for much longer,” Shames said.

SDG&E;’s average systemwide rates have long been higher than rates charged by PG&E; and Edison, Hansen said. But, in recent years, SDG&E;’s rates have slowly fallen while PG&E; and Edison have been increasing their electricity rates.

When the new rates take effect, SDG&E;’s systemwide rates will be slightly lower than rates charged by PG&E;, the state’s largest utility, and Edison, the state’s second-largest. PG&E; serves much of Northern California, and Edison delivers power to most of Southern California, except for significant parts of the greater Los Angeles area and some cities in Orange County.

‘Bittersweet Victory’

Cutting rates for SDG&E; customers has been “the company’s No. 1 corporate goal for the past several years,” Hansen said. “We’ve been working toward that goal with several aggressive cost-reduction programs, including lower earnings, reduced capital expenditures, reductions in the work force, and reduction in long-term debt.”

“The lower rates are a testament to the community and the utility,” said Shames, whose organization participated in hearings that led to the decreases. “We have finally achieved rates that are lower than Edison’s rates.”

Shames described the lower rates as “a bittersweet victory for SDG&E; . . . they put so much effort into reaching this point and (the occasion) will probably be spoiled” by the realization that SDG&E; will disappear if the merger occurs.