What does this say about our escalating rates when my January 2023 utilities bill was equivalent to almost half of my social security check for that month. For lower-income residents, the burden surely is worse.
Our electricity rates in Palo Alto increased by 20 percent t in January and that 20 percent hike will continue each month.
My utilities bill hit a record high of $927 --the biggest culprit was the electric charges. Our house is heated electrically and our use is consistent, yet the charges increase each year. (I know some of you are experiencing even higher bills.) During the winter we only heat two rooms of our 10-room house -- the family room and one bedroom. I walk around wearing a sweater and fleece jacket. Just the two of us (and 11-my pound dog) live in this house.
Then last week I saw the dire headline that said our utilities bills would again increase in July 2023. The Utilities Department said (my comments are in italic) the additional charges are:
Water – 7 percent starting July 2023 (fiscal year 2023-24), then 3 percent hike in each of following three years. This is driven by infrastructural improvement, and increasing seismic safety. What the department does not say is these increases are compounded. Simply put, if there is a 7% increase in 2023, the 2024 increase of 3% would be based on the 2023 rate bplus the 7% increase.
Wastewater – a cumulative 9 percent increase between 2024 and 2028.
Gas – 8 percent rise in gas rates, assuming supply costs will remain steady during 2023 and 2024. If the assumption is wrong, then these rates could go higher.
Electric – the city is planning to raise the basic rate by 14 percent, which means that even if the “hydro rate adjusters” are slashed in half because of drought relief, our bills will remain at the same current level.Why not just drop the drought charge altogether? Maybe it’s their way to avoid any drop in revenues it gets from utility users. Clever, isn’t it!
That drought charge
The irony of our increase in water rates simply make me laugh. We are paying water drought charges even though the drought doesn’t exist this year. Our water rates are higher because we aren’t using enough to maintain the department . I am thinking that maybe the city wants all the increases because then it can keep all its utilities personnel fully employed and happy with their raises.
The Utilities Department said there are multiple reasons for these increases – high wholesale cost increases, which may vary; the department’s plan to “refill its depleted financial reserves,” and upgrading aging infrastructure,. . Rational reasons but these upgrades are ongoing and the upgrades seem never-ending.
City officials and the state, also are also, simultaneously, encouraging Palo Altans to buy electric cars, which will put an additional burden of providing more electricity to utilities customers in the next few years. Of course, the council is still going along with its plan for this city residences to go all-electric, starting with electric, not gas, heat pump water heaters.
By the way, the Utilities Department has said it cannot, as yet, provide enough electricity until it ramps up its transformers and power lines. And upgrading these transformers and power lines are still only in the planning stage.
I suggest that this all-electric plan is our virtue signaling, because city officials hope that Palo Alto will show it is a leader in going all-electric, and the city can serve as a model for other cities to emulate. Oh, the fame this city will have!
However, the state of California will need three times more capacity to reach 100 percent clean energy by 2045, according to a report from the Joint Power Agency Report, Energy Commission, published in the Weekly. Can we really achieve this goal? We haven’t done too well on our other climate goals.
Other considerations
There are several other issues here. The Utilities Department is suggesting we become more efficient in our energy use by turning down our thermostats, using less water on our yards or planting drought resistant native plants. In other words, use less gas, water and electric. Nothing new about that message.
And another dilemma -- at the same time, legislators in the state are urging cities to build more housing, especially affordable housing, which means more people will live in this area and require more water, gas and electricity.
Palo Alto imposed a drought tax a year or so ago, which will be cut in half this year because we no longer have a drought. Half means that we will still have a drought tax. And while we are being been urged to use less water during the drought, or water rates have gone up because we use too little and the department needs more funding to operate. “Operate,” I suspect includes paying all the employees who work in Utilities, including giving them annual raises and, in some cases, bonuses.
Sure, it’s easy and logical to argue that all the maintenance and upgrades are necessary and needed, but are all these things necessary? And must the city and state work on all “needs” at once?
The ironies of these increase
What’s missing in all these energy plans and goals, I think, is the seeming lack of concern about how these rate hikes will affect consumers, because we are the ones who have to pay for all these upgrades, expansions and repairs.
Our City Council and our Utilities Commission accepted the Utilities Department’s rationale for why all these rates had to increase. There was little probing, few pointed questions challenging their assumptions and predictions.
An audit is definitely in order. Our costs are too high, compared to other places in this state. Let’s hire an outsider auditor, not someone internal nor a person who reports to the city manager. A report to the public is in order!
