California’s so-called “public goods” charge paid by all customers of the state’s private-sector utilities is the focus of a confrontation between the natural gas utilities and the independent consumer unit at the California Public Utilities Commission (CPUC). The head-knocking will come to a close at an oral argument the CPUC will hold Aug. 25.

At issue is a proposal by the three gas utilities — Pacific Gas and Electric Co., Southern California Gas Co. and San Diego Gas and Electric Co. — to reallocate public goods charges away from the large industrial customers to residential consumers. The CPUC’s Division of Ratepayer Advocates (DRA) is adamantly opposed to the utilities’ proposal.

DRA contends that the proposal will shift a greater portion of the public goods charges onto the residential customers, “who are already paying their fair share,” while lowering amounts paid by the state’s biggest gas consumers, such as oil refineries and power generation plants.

The California Alternate Rates for Energy (CARE) program providing 20% rate discounts for eligible low-income customers is one of the main beneficiaries of the public goods monies, DRA argued. “The cost shift proposed is not only inequitable to residential and small commercial customers, it also threatens the funding of the CARE program.”

Since the gas utilities’ joint filing last December, DRA has issued testimony and a staff report seeking to push back at the proposed cost shift. Evidentiary hearings were held in July, and now the oral argument will give both sides a chance to state their cases before the administrative law judge issues a proposed decision for the five-member CPUC to consider.

Created by the state legislature more than a decade ago, DRA uses a multi-disciplinary staff with expertise in economics, finance, accounting and engineering to operate as a semi-autonomous branch of the CPUC. Its views and recommendations do not necessarily coincide with those of the panel.

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