Southern California Edison won permission to hike its rates July 1 by 3.25% overall, including a 5.8% increase in residential rates, in part to cover increased costs of energy used to produce electricity, the Public Utilities Commission said Wednesday.
The $201.4-million increase will add $2.84 per month to the bill of a typical residential user of 500 kilowatt-hours of electricity, boosting the bill to $53.29 from $50.45, the PUC said.
Residential customers will see rate hikes higher than those for industrial and commercialusers because it costs Edison more to supply each residential customer than to supply large users, the PUC said.
The rate increase was lower than Edison's request in March to hike overall rates 5.7%, or $351.3 million, which would have added $4.12 to the average residential bill.
Agricultural, commercial and some industrial customers will see rate increases of between 0.3% and 3%. Other customers will see decreases of between 1.8% to 3.4%, reflecting lower costs of providing them with power, the PUC said.
The July 1 increase will cover $150.7 million in higher costs of purchasing power from other sources, as well as higher prices for natural gas used to generate electricity, Edison said.
Ron Daniels, manager of revenue requirements for Edison, said the largest increases came in the cost for buying electricity from cogeneration plants. Gas costs were also higher as the state needed to buy more because the drought reduced the availability of cheaper hydroelectric power, he said.
The rate increase will also cover $50.7 million in new construction and conservation costs, including those associated with a new power station at Balsam Meadows in Fresno County and an expanded transmission line between Palm Springs and Orange County.
Those costs were approved by the PUC earlier this year, but any rate increases were postponed to be included in the current increase, PUC officials said.
Later this summer, the PUC will take up a separate request by Edison to reduce rates by $50 million effective Jan. 1. That request, made in May, would become effective after the current rate hike paid for higher costs, Daniels said.