PGE Rate Increase Request Climbs to 10.9%
Posted on August 1, 2024 by Charlotte Shuff
Tags, Energy, General Interest
After several updates, Portland General Electric (PGE) is now asking to raise billing rates for all customers by 10.9% in 2025, up from its originally requested 7.4%. This double-digit proposal comes on the heels of a record number of households disconnected in April and May.
This continuing rise in rate increases is a symptom of a larger issue: Utilities are asking for more money more often in Oregon. CUB is calling on regulators to address the energy affordability crisis Oregonians have faced this year and cut PGE’s request by millions of dollars.
Recentering Utility Customers in Rate Increase Conversations
For too long, regulation in Oregon has been focused on what utilities want. While providing vital energy service is extremely important, that service doesn’t actually matter if people cannot afford to use it.
One CUB supporter shared her frustration with us:
“We need educated help to hopefully stop this endless drain on our limited funds. Too many [utilities] are assuming that consumers are an endless source of money for their projects. Possibly this is true for some but I am one of a massive group that is on a fixed income that cannot continually stretch to cover endless ideas. I realize that one invests to make money. But at some point, there has to be considerations to lessen profit each month and have that money be used to help share the cost of the big picture.”
- Nora, CUB Supporter
Customers know that utilities like PGE are asking for more than they can afford. People like Nora are facing the impossible challenge of figuring out how to pay increasing utility bills while their income stays stagnant. For folks who are already struggling, an increase of 10.9% would hit hard.
Customers Are Already Struggling to Afford Energy Now
In January 2024, PGE raised rates by 18% for residential customers. Just four months later, we saw the consequences of this increase. PGE shut off power for more customers than ever recorded in April and May of this year.
In April, PGE shut off 4,712 households—the most since reporting began in 2018. In May, PGE shut off 4,303 households. This marks the only time that a utility has reported exceeded four thousand disconnections two months in a row. By comparison, April 2023 saw only 1,313 shut-offs for non-payment.
These disconnections were the result of families’ inability to keep up with the cost of electricity. This year’s rate increase, combined with extreme weather, pushed people into an energy affordability crisis. If PGE is allowed to have another double-digit increase, 2025 could see new records of disconnections. This trend of unaffordable electricity cannot continue.
The Solutions We Have Aren’t Meeting Current Needs
CUB has worked since our founding to protect customers from unaffordable utility bills. In the past few years, we have seen big wins. Utilities now have bill discount programs for customers with low incomes. There is more representation from environmental justice communities in decisions that impact utility bills. And we have stronger protections against punitive policies that impact those who struggle financially.
But these solutions are not enough when people still cannot afford their bills. We should not be seeing record disconnections at the same time that families are receiving monthly bill discounts.
We’re also seeing those with some of the lowest incomes in the state paying the highest percentage of their income to energy bills. For example, manufactured and mobile homes are notoriously inefficient in their use of energy but are significantly more affordable housing options for many people with limited incomes. However many families living in manufactured housing are paying nearly $500 per month for electricity in the winter. This means a family living in a 1,000-square-foot mobile home may be paying the same (or more) as someone living in a built house of twice the size.
Those with fewer financial resources are the ones most harmed by rate increases. We need a cap on rate increases, stronger protections against disconnection, and better programs for people behind on their bills.
We Need to Stop Giving PGE a Blank Check
PGE customers may be facing an energy affordability crisis, but the company is more concerned with spending money on profit-making investments. CUB is pushing regulators to reign in skyrocketing spending by PGE and recentering peoples’ ability to afford critical energy services.
PGE Ramps Up Spending with No End in Sight
The spending target for this year, 2024, was established at $500 million in 2020. By February of last year, it had grown by almost 50% to $730 million. But its growth has accelerated since then, to $1.34 billion in April of this year - a 268% increase from the original spending target in just four years.
And there is no reason to believe that 2024 spending won’t continue to grow as PGE identifies more things that it can spend money on this year. We saw this trend in spending for 2023. The trend seems to be continuing into at least 2027. If this trend continues, Oregonians could continue to see double-digit rate increases for the foreseeable future.
Rate Increases Benefit PGE Shareholders, Not Customers
Almost every time PGE increases billing rates for customers, PGE shareholders benefit. Utilities make a profit off of investments. When PGE builds a new battery storage facility, lays new transmission lines, or spends money on other infrastructure, it is allowed to make a profit.
Utilities have an incentive to spend as much money as possible on useful capital projects. But just because a project is “useful” doesn’t mean that it needs to happen immediately. PGE is notorious for projecting high amounts of spending to investors while attempting to keep customers in the dark about how that spending will affect bills.
Say Enough is Enough: Share Your Comments with Regulators
Regulators need to hear from regular people about the impact a 10.9% increase in billing rates would cause. Public comment is the best way for individual Oregonians to speak up against yet another addition to the energy affordability crisis. Comments submitted before August 27, 2024, will have the most impact before the final decision in October.
To add your comments, you can use CUB’s action form with template comments that will be sent to regulators.
Send Your Public Comment Today!
You can also send comments to the Public Utility Commission directly at .(JavaScript must be enabled to view this email address)PUC.PublicComments@puc.oregon.gov, over the phone at 503-378-6600, or through the Commission’s website.
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08/22/24 | 4 Comments | PGE Rate Increase Request Climbs to 10.9%