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Palo Alto prepares for higher utility bills as reservoir levels dip

Original post made on Dec 20, 2022

Palo Alto's utility customers will see a jolt in January, with residential bills set to rise by about 20% thanks to growing energy costs and diminished production from the city's hydroelectric facilities.

Read the full story here Web Link posted Tuesday, December 20, 2022, 9:53 AM

Comments (22)

Posted by Online Name
a resident of Embarcadero Oaks/Leland
on Dec 20, 2022 at 10:55 am

Online Name is a registered user.

"With the average residential bill set to jump from $86.57 to $103.72, the rate will be about 39% below PG&E, compared to 49% before the change, according to data from the Utilities Department...."

The Utilities Department data seems to be missing its end ZERO. With a $50 MONTHLY city utility tax it's tough to imagine anyone paying $86.57 -- especially when friends are comparing their latest bill after our first cold weather!

(That tax throws off $14,400,000 for CPAU on top of the low-sacred practice of "overcharging" us $20,000,000 a year. )

Please find just ONE person who pays less than $100 a month and describe their living quarters instead of taking CPAU's pronouncements at face "value"

Posted by Robert
a resident of Midtown
on Dec 20, 2022 at 11:43 am

Robert is a registered user.

The rip-off continues!!!

Posted by Mondoman
a resident of Green Acres
on Dec 20, 2022 at 3:03 pm

Mondoman is a registered user.

So the "profit" the City siphons off from Palo Alto Utilities every year will not be reduced; rather our rates get raised ...

Posted by Tom
a resident of Menlo Park
on Dec 20, 2022 at 3:59 pm

Tom is a registered user.

I recommend restructuring the electric rates a bit to accommodate the fixed costs of hydro projects and the variable output. To reduce the volumetric rate (cents per kWh) consider collecting part of the fixed costs from a fixed charge scaled to the size of the electric panel connection to the utility.

Example: collect 10 cents per Amp per month and use the revenue to reduce volumetric rates. So a small 60Amp panel customer pays $6/ month, a medium customer ( 100 Amp panel as is common on many over homes ) pays $10/per month and larger customers with 200 Amp panels pay $20 and the oversized customers at 400 Amps pay $40 per month for their connection charge.

This rate structure would help encourage electrification and climate preservation by encouraging efficient electrification without upsizing panels too much and it would produce lower volumetric rates for the electric energy to power the efficient heat pumps and heat pump water heaters needed to get off gas.

And having looked at the cost of heating with gas, I can see it's about to get very expensive all across California as utilities like Palo Alto's need to buy volatile gas to fuel customers who have not upgraded to clean electric machines. I think the bills arriving around the holidays statewide may be 3 times as high as a year ago.

It's time to schedule a heat pump installation for early in the new year when the $2000 federal tax credits kick in. Otherwise it's time to bundle up and turn down the thermostats and further shorten showers to reduce the gas bill surprise.

Posted by Bystander
a resident of Another Palo Alto neighborhood
on Dec 20, 2022 at 5:39 pm

Bystander is a registered user.

We are expected to put up with all the outages due to poor management of the lines and then pay more. How about someone at the Weekly doing a report about all the outages and how much that has cost small businesses in lost sales, in wasted food, etc. How about those of us who lose power when baking when the power goes out. That food is unable to be kept and used later. How about those whose cars don't fully charge overnight and they can't be used the following day due to not enough charge.

The repercussions of an outage are not merely inconvenience of not having light, but serious problems for most of us and that doesn't take into account those who have medical machines that need power. To say that we are just in the dark when there is a power outage is outdated. With people working from home and crucial power reliability to charge and keep internet running, the cost of losing power to a consumer is a problem.

If our service was more reliable we probably wouldn't complain so much about the increase.

Posted by Online Name
a resident of Embarcadero Oaks/Leland
on Dec 20, 2022 at 6:22 pm

Online Name is a registered user.

"We are expected to put up with all the outages due to poor management of the lines and then pay more."

Not only do the outages cost us money but to add insult to injury the same managers get raises and bonuses. We're supposed to ignore that it takes them more than a year to approve solar permits which now cost residents even more money since the state is cutting back its solar incentives and ignores the thousands of dollars it's cost residents when their solar contractors backed out of the deal, refusing to do business in Palo Alto.

PA "managers" keep making out like bandits with no incentives to improve their performance, residents and resident-dependent business not so much.

Posted by TimR
a resident of Downtown North
on Dec 20, 2022 at 7:01 pm

TimR is a registered user.

So, pass laws requiring people to go electric, and then increase the rates by three times more than the rate of inflation? I think I see what's going on here!

Posted by Annette
a resident of College Terrace
on Dec 20, 2022 at 7:06 pm

Annette is a registered user.

Online Name makes a very good point about solar. The way the City approaches solar installation and permit approvals pretty much makes a mockery of all the SCAP talk. I think Palo Altans are willing to embrace alternative energy sources; the City needs to do its part and be efficient about permits and approvals. In fact, they should make that a priority so that they don't defeat the willingness of residents to go solar and/or convert to electric.

Posted by MyFeelz
a resident of another community
on Dec 20, 2022 at 8:36 pm

MyFeelz is a registered user.

How's the conversion from gas to electric water heaters fleshing out? Everybody happy with their contractor and the price and do the products live up to the hype?

Posted by tpencek
a resident of Midtown
on Dec 21, 2022 at 7:50 am

tpencek is a registered user.

There is a lot of anger about utility prices and upward pressure on water rates, natural gas pricing, and now electric rates in Palo Alto. I understand and share that emotion. As a retired resident and ratepayer, I think "utility inflation" here in Palo Alto has been steady, year over year, for sometime. The run-up in natural gas prices and the draught are just the latest twists in the road. I don't have the exact numbers, but it seems that the rates (not just the cost of consumption, but the "fixed meter charges") just keep going up. I pay more utilities every year, and the increases are always greater than the inflation rate.

In light of this steady rise in prices, and the pain it is causing residents, I think it is time to forego any transfers from the Utility Funds to the General Fund. Even if it is legally permissible, I think the Council should balance its need to respond to pressures in the marketplace for water, power, and natural gas with its responsibility to the residents and ratepayers to protect them from constant rate increases. If there IS a surplus in any of the Utility Enterprise Funds it should STAY in those funds, to reduce the need to raise rates.

Posted by Palo Alto native
a resident of Old Palo Alto
on Dec 21, 2022 at 9:35 am

Palo Alto native is a registered user.

I agree with tpencek. I also voted against proposition K or L which had us all vote on continuing transfers from Utilities to the General Fund. I strongly feel that the Utility rates should only fund our Utility usage. Thanks to Miriam Green for taking the City on with the legal case against moving utility monies over to the General Fund. Unfortunately the voters decided to continuing this ‘irregular’ practice of moving funds. Our General Fund is very BLOATED, way to many managers making over $150,000. Also our City(Molly Stump) has come out against the Grand Jury finding that our City Propositions are BIASED in favor of Palo Alro’ interests. Seems like the voters are content to roll along with the status quo. Or until they pick up stakes and move to other parts of the country!

Posted by MyFeelz
a resident of another community
on Dec 21, 2022 at 3:53 pm

MyFeelz is a registered user.

Reservoirs are filling. Will we get the money back after the water exceeds its natural rim?

Posted by Moctod
a resident of University South
on Dec 21, 2022 at 5:39 pm

Moctod is a registered user.

Palo Alto is pulling about 12-14 million out of electric fees into the general fund. Some of these monies did go to a fund to spend 13 million on "smart" (time of use) meters and another 1.3 million to pay yet another contractor to read the meters and bill our users.

When those meters go in, that recent rate increase (due to the drought, but it will never be rescinded) will pale in comparison to the increase in your electric bill. The managers in Palo Alto Utilities (and there are many), have stated that to keep usage down during the times of peak demands on the grid (all of the western US) they will force PA electric customers to cut back electric usage when they most want to use it, 5-9:00 PM (depending on the day) will have very high rates, many times the base rate, day usage will be the second highest. The lowest rates will be at night when many of us want to turn our heat down and go to bed. There will be no carrots here (perhaps a smug factor), just the stick of huge electric rate increases.

I believe that a significant reason that our fair city wants time of use meters is to milk the cash cow of electric rates. They will wait until the meters are all in and force you into washing your clothes late at night. Save that Christmas sweater, you willl need it.

At the same time Palo Alto has decided it is our best interest to cut off natural gas usage. They were planning to do this in the next few years, but it was pointed out that our local grid would not support the usage. They have banned the use of natural gas in new homes and will require replacing gas appliances with electric. Oh, and we just tore up our streets to install new gas lines...

You will have an option to refuse a new "smart" meter but the Utilities Advisory Commission has agreed with the City staff to charge you $100 not to put in a new meter and will require you to read your own meter for a charge of $25. per month. PG&E charges $15 month and reads your meter.

Posted by Larry
a resident of Downtown North
on Dec 21, 2022 at 6:37 pm

Larry is a registered user.

>>"Reservoirs are filling. Will we get the money back after the water exceeds its natural rim?"

Yes we will, once the reservoirs reach 75% of capacity. At least that is my understanding from reading the CPAU rate schedules (link below). The Electric Rate Hydro Adjuster is either a surcharge or discount, depending on the "strength" of the hydro portfolio. The CC just voted to increase the maximum surcharge amount, but did they also increase the maximum discount?

Web Link

Posted by Larry
a resident of Downtown North
on Dec 21, 2022 at 6:58 pm

Larry is a registered user.

>>"Please find just ONE person who pays less than $100 a month "

Me. But you misquoted the article a little bit. It said "With the average residential *electric* bill set to jump from $86.57 to $103.72..." (emphasis added), so they are deliberately excluding any taxes of fees. I get it that we end up paying more on the whole bill, but since the article is about electric rates, it seems legit to quote only the new law's impact on the electricity line item. Anyway, my last electric bill was indeed about $86 for a 3 bed/2 bath single-story home with gas water heater, furnace, and cooktop, and everything else electric. And no EVs. So the CPAU number agrees well with my situation.

Posted by Gennady Sheyner
Palo Alto Weekly staff writer
on Dec 21, 2022 at 7:22 pm

Gennady Sheyner is a registered user.


I initially failed to make it clear in the article that the rate cited refers just to the electric portion of the bill. I later added "electric" for clarity.

Posted by MyFeelz
a resident of another community
on Dec 22, 2022 at 8:45 am

MyFeelz is a registered user.

I asked before because I am genuinely interested in hearing from people who have converted their water heaters with the City discount and rebate plan. Nobody answered. Is there anybody within seeing distance of this article who took advantage of the City's plan to reduce fossil fuels by giving rapid permits and rebates to convert? Any takers? Web Link That's the City's website where a person can sign up for the program and the list of contractors who the City will approve the rebates through.

Posted by Larry
a resident of Downtown North
on Dec 22, 2022 at 11:39 am

Larry is a registered user.


Thanks for clarifying. @Online Name must have been quoting from the earlier version, so my apologies for accusing him/her of misquoting. $100 for a total monthly would indeed be a miracle!

Posted by AR
a resident of Fairmeadow
on Jan 25, 2023 at 12:56 pm

AR is a registered user.

For reference, I have a home in Tahoe, and all-in gas charges are $2.12 per therm. In Palo Alto, the same charge is $4.85 per therm. There is something really wrong with how the city is managing utility.

Posted by Online Name
a resident of Embarcadero Oaks/Leland
on Jan 25, 2023 at 1:10 pm

Online Name is a registered user.

Speaking of the Miriam Green lawsuit, where are our court-ordered refunds? Are we getting interest on late payments? I ask because the payments have been delayed for years.

@Gennady Sheyner, maybe you can do a follow-up? It would be outrageous to learn that we're paying for yet another appeal managed by outside counsel. Thanks in advance.

PS: Good for San Carlos to vote against the forced conversions at a time when natural gas is at an all-time low. At least they understand the pain of their residents during a time of recession, massive layoffs and the stock market tanking.

Posted by MyFeelz
a resident of another community
on Jan 25, 2023 at 9:46 pm

MyFeelz is a registered user.

@Online Name, I think the refunds are stuck where the remainder of the unpaid Middle Income Tax Money Giveaways are. As for the utility increases, no matter what the reservoir rim is, Palo Alto is just giving us an advance preview of what to expect in the future. By the time we get used to paying 20% more, they won't lower the rates because of inflation, unemployment, low GDP, jock itch and scabies.

Posted by Online Name
a resident of Embarcadero Oaks/Leland
on Jan 26, 2023 at 9:31 am

Online Name is a registered user.

As to "city leaders starting to wonderi" if how things are doing in certain neighborhoods as per the recent survey, maybe they and the reporters here could check out the reactions from more than 250 people on NextD Door this morning. No time like the present.

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