San Diego Gas and Electric, along with SCE and PGE, won a rate increase of 3% for its most conservative users. They are only permitted to raise rates 3-5% for users of less than 500 kilowatt hours per month and it’s supposed to match inflation. Since inflation was 0% this year, the rate increase does not seem fair. These companies say that they won’t be making any more money because of the rate changes, but there is something that they aren’t telling consumers.
San Diego Gas and Electric has a monopoly on energy production in San Diego and it decides how to structure the rates that it charges residents. SDG&E is owned by Sempra Energy, which is a for-profit, private company. San Diegans do not have a choice where we get our energy, or do we?
A solar installation is a much better option for energy production. Since San Diego is sunny almost every day of the year, homeowners require much less of an investment in their solar system to produce the amount of electricity needed to power their home. Solar panels can provide the necessary energy to free homeowners from the expensive electricity in the upper tiers of SDG&E’s energy rate structure.
The following example is an approximation, as energy rates are determined by location. The first 2 electric tiers are 13 cents for approximately the first 400 kilowatt hours, then 15 cents for the next 100 kWhs. After the energy consumer surpasses 500 kWhs in a month, the rates double to 31 cents and 33 cents for tiers 3 and 4 respectively. It is a much better investment strategy to build a solar system that eliminates all but 500 kilowatt hours, to leave just the cheap electric tiers.
Homeowners in San Diego can not eliminate San Diego Gas and Electric. We can at least limit their ability to raise rates with a solar electric system.