As state officials debate whether to extend an electric utility surcharge, Pacific Gas and Electric Co. (PG&E) has challenged state legislators for diverting $155 million in natural gas ratepayer-collected surcharge funds to help cut the state’s gaping budget deficit earlier this year.

In supporting a state legislative proposal (SB 939) to protect the gas public purpose funds, PG&E said that in the recently approved state budget (AB 87) lawmakers transferred the gas ratepayer funds to the state’s general fund and away from their intended use in providing energy efficiency programs. “SB 939 seeks to prohibit such transfers from taking place in the future by removing the Board of Equalization from the collection mechanism,” a Sacramento-based PG&E executive said.

Late this month California Gov. Jerry Brown surfaced a major political battle in the waning days of the state legislative session over whether to extend an electric surcharge that provides up to $400 million for research and development (R&D) in energy saving and alternative energy (see Daily GPI, Aug. 26). Brown is trying to make the case that the $1-2 monthly charge on residential utility bills is a job-creating mechanism.

On the gas side, PG&E said in a letter to state legislators earlier in August that it is supporting SB 939 “to ensure funds collected from our customers to support various public purpose programs, such as energy efficiency, low-income programs and research, development and demonstration programs, are used for their intended purposes.”

PG&E emphasized that using utility ratepayer public good funds to balance the state budget has “a tremendous and detrimental effect” on the state’s energy efficiency efforts. The San Francisco-based combination utility is now working with the California Public Utilities Commission to determine the severity of the potential impacts from the funding shortage.

The utility has estimated that rebates totaling more than $65 million will be lost this year, along with adversely affecting partnerships with at least 14 local governments on installing various energy efficiency devices.

“These curtailments interrupt the momentum of the programs that serve more than two-thirds of California to the harm of consumers, energy efficiency goals and small business vendors,” the Sacramento-based PG&E official wrote to the Assembly Appropriations Committee Chair Felipe Fuentes. “Without a permanent fix to the funding mechanism as proposed under SB 939, these short-term impacts are susceptible to long-term consequences.”

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