Redding City Council Says No to High Fixed Charges

In the northern California city of Redding, a victory was won last night on utility rate design, likely a portent of things to come. Redding Electric Utility (REU), the local municipally-owned utility, recently proposed to increase its monthly fixed charge, a charge you pay to the utility regardless of how much energy you use, from $13 to a whopping $42 per month. If approved, it would have been the highest fixed charge of any California utility, and one of the highest anywhere in the entire country. Large fixed charges disproportionately penalize low-income and lower-use customers and reward high energy consumption, which is unfair and sends the wrong message about energy usage. (For the right way to do rate design, check out our coalition principles here.)

Last night, Redding City Council met to discuss REU’s proposal. Thanks to spirited organizing by groups including The Alliance for Solar Choice, AARP and Vote Solar, there were over 100 local citizens in the room, and close to 30 spoke (all but one were opposed to REU’s proposal). The Redding City Council then unanimously voted not to address REU’s proposed fixed charge in 2015. The Council asked REU to report back to the council in 2016 on whether there’s a need to revisit the idea of fixed charge. REU’s unfair fixed charge proposal has been tabled indefinitely!

It’s inspiring to see what happens when people make their voices heard in opposition to unfair utility proposals — a huge thanks to everyone who took the time to get involved. And three cheers for Redding City Council’s leadership, standing up for customer choice and fair rate design! Other utilities who might be thinking of proposing high fixed charges should take note…