“Hello, I would like to talk with someone at your company about the large increase in my electric bill.”
So started my surreal conversation with a Pacific Gas and Electric (PG&E) representative. I had noticed that the amount I was paying monthly for electricity had suddenly jumped up, once again, after PG&E launched a new method of “billing.”
I’ve gotten grimly used to prices rising like a slow helium balloon, whether at the gas pump, grocery stores, or restaurants. The Bureau of Labor Statistics’ latest report says annualized inflation had climbed to 3.8% in April, the highest since May 2023, even as President Donald Trump recently said: “I don’t think about Americans’ financial situation…not even a little bit.”
Since I can’t call President Trump or any other elected official, I believe it is responsible for inflation, I settled on my local utility company.
“Hello, I noticed my electric bill has gone up yet again, the third time in a year. It looks like now you are charging a new service fee of $24 per month? Can I please speak to someone who can explain to me your new billing?”
PG&E provides natural gas and electricity to 16 million people in northern and central California, from Bakersfield in the south to the Oregon and Nevada state lines. I’m sure it’s a tough job; that’s a lot of people over a giant service area that needs energy for their homes and businesses.
And unfortunately, if I don’t like PG&E’s prices or service, I can’t shop for another company. PG&E, a privately-owned utility, has been granted a monopoly over our 70,000 square mile area by the government. In return, the company is required to ask the California Public Utilities Commission if it can increase its rates. Even before Trump’s ill-advised war in Iran and its impact on oil prices, PG&E’s rates were up 41% over the past three years and 101% over the last decade, many times higher than the rate of inflation.
But apparently that wasn’t enough for PG&E. So their lobbyists went to California Governor Gavin Newsom and asked if it could implement a “new billing structure.”
Shifting the blame
Previously, all billing was based strictly on usage – the number of kilowatt-hours used multiplied by the rate per kilowatt-hour, which in California has been around 38 to 40 cents per kilowatt hour -- the second highest rate in the country, after Hawaii. For the new billing format, PG&E instead asked that all customers pay a mandatory Basic Services Charge of about $24 per month, regardless of how many kilowatt hours used, which – I was told – is “designed to cover infrastructure costs.”
And in return, PG&E would lower the price per kilowatt-hour to about 32.6 cents. PG&E swore that this would mean customers would either pay the same on their monthly bill or pay a little bit less.
But that’s not how it worked out. My wife and I have had two monthly bills now with the new billing method. In the first month, we paid 43% more for electricity than we would have under the old billing system. In the second month, we paid about 16% higher with the new billing system. WTH!
When PG&E and other utilities proposed this, utility watchdog groups were skeptical, saying it would turn into a “back door” rate increase. Nevertheless, Governor Gavin Newsom and legislative leaders sneakily pushed through the authorizing legislation for this billing change using a legislative trick -- they attached the bill as a “trailer” to an existing bill, which is usually reserved for inconsequential additions. So there were no committee hearings, no debates or no standalone floor votes in the Assembly or Senate. Even many of the legislators later complained that they didn’t know or read the bill.
Many people are now fuming. So I called PG&E to hear its explanation. Who knows, maybe there’s something that I don’t understand?
Blame game
The PG&E rep on the phone at first sounded syrupy and nice in that scripted "customer service voice." He claimed the state of California was “requiring” the company to shift its billing procedure. But I politely pointed out that there had been news articles reporting that this was the brainchild of the utility companies. So then he shifted to saying company costs have increased dramatically, just like everyone else’s costs, and the company needs more money to invest in renewable energy production and to build out the power grid for electric cars.
OK, fair enough. But I pointed out that PG&E had enjoyed record profits in 2024, and profits rose in 2025 by $118 million to $2.59 billion, with its CEO receiving $19.8 million in compensation, a 25% increase. The CPUC granted it six rate increases in 2024 and two more in 2025. “You’re ranked 175th on the Fortune 500 list, for heaven’s sake,” I said. “You’re not exactly hurting for cash.”
The PG&E rep now grew a bit huffy and tried a new tack -- talking down to me, shifting from his syrupy voice to sarcasm.
“Well you know, this really wasn’t a change,” he said. “The monthly service charge is not really a new fee, it’s just a reallocation of how we display our infrastructure and service costs that were previously embedded within the per kilowatt-hour rate. Now we show them separately on your bill, that’s all."
What a non-answer. Who cares about that? All people are concerned about is how much they pay. And I am now being charged on average 30 percent more for my electricity usage than with the old billing method.
We went round and round. Company PR flacks are steeped in their own reality distortion field. But here’s what he finally admitted, which is bizarre.
Those households that use less electricity and power are the ones that are seeing their monthly bills increase. While energy hog households that use greater amounts of electricity and power are seeing their monthly bills decrease. So, if you bought energy efficient appliances, invested in solar panels, avoid using the dishwasher during peak hours, and turn off lights to keep your usage low, your PG&E bill has gone up. Yet energy vampires who live in McMansions and use lots of power are seeing their bills decrease.
How wacky is that? The Utility Tax (as some are calling the monthly fee) is increasing electricity bills on four million households that use less energy. The average household will see a bump in what they pay annually of roughly $400. This goes against all previous conservation efforts which tried to incentivize reducing use of electricity and heat.
The disaster-prone company
The high prices and soaring profits might be acceptable if PG&E provided good service. But the company has long had a troubling safety record. Its service has resulted in a number of deadly disasters in recent years. In 2019, it was forced to declare bankruptcy to shelter the company against over $30 billion in liability lawsuits – nearly six times its market capitalization -- from catastrophic California wildfires caused by its negligence and equipment failures. That includes the 2018 Camp Fire, which killed 87 people and wiped off the map the town of – ready for this – Paradise, which was reduced to black burned rubble and standalone chimneys. More like Paradise Lost.
I still remember the deadly pipeline explosion in the Crestmoor neighborhood of San Bruno, just south of where I lived in San Francisco. Eight people were killed and their homes blown up due to PG&E’s failure to inspect gas lines. The initial blast shot a fireball more than 1,000 feet in the air. In 2023, a smaller version happened in nearby Daly City.
Just last year, multiple blackouts before Christmas and New Year’s Day left tens of thousands of San Francisco residents without electricity for several days. PG&E has pled guilty to numerous felonies related to safety violations, manslaughter and injuries to firefighters stemming from numerous California wildfires. In 2022, PG&E ended five years of federal probation after being convicted in the San Bruno explosions, with the judge noting that, even during its probation, the PG&E equipment sparked 31 wildfires which the judge referred to as a "crime spree" as he called the company a “continuing menace.”
How many companies tied to fatal disasters can still secure rate hikes from government regulators? The utility’s reputation is about as popular as a wildfire. And yet Governor Newsom and his CPUC keep approving one rate increase after another, as well as ballooning salaries for their executives, for a utility repeatedly found guilty by judges in some of the state’s deadliest disasters.
The anger and frustration of Californians toward PG&E is matched only by a rising sense that their political leaders have become nonresponsive and incapable of reining in such flagrantly egregious corporate behavior.
Steven Hill was policy director for the Center for Humane Technology, co-founder of FairVote, and political reform director at New America. See more of his writing at his Substack newsletter DemocracySOS.
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