California regulators voted Thursday to impose a set monthly charge on electricity customers, resolving a hot-button debate that had drawn in lawmakers concerned about high bills as the state transitions to electric cars and appliances.

What happened: The California Public Utilities Commission voted 4-0 to put a fee of roughly $24 per month on most customers' bills in a move intended to try to make bills fairer and boost the state’s clean energy transition. It will not go into effect until next year, at the earliest.

The agency said that by reducing per-unit rates the plan would bring down bills for most Californians, with the exception of low-electricity users on the coast who would pay a little more. It would save an average customer up to $25 per month on electric vehicle charging and up to $19 per month on electric appliances compared to today’s structure.

CPUC President Alice Reynolds at Thursday's meeting called it "a very incremental but important step towards this decarbonized future."

"We're marching towards a future we want to see," she said. "One where we can replace gas guzzling-cars on our roads with EVs that run on clean electricity and emit less pollutants; a future where we swap gas-fired appliances in our homes with all-electric ones."

Background: Lawmakers mandated the change in 2022's CA AB205 (21R), a last-minute budget bill that directed the CPUC to more equitably distribute the costs of the electrical infrastructure everyone uses, such as transformers and wires, and the costs of achieving the state’s climate goals.

The legislation ordered the agency to restructure bills so they would include two components: A flat monthly fee that varies with income, with wealthiest people paying the most, and the standard usage-based portion. The decision charges $12 for customers who earn up to 250 percent of the federal poverty level and $6 for those who make less than 200 percent of the federal poverty level.

Lawmaker anxiety: Lawmakers got involved again earlier this year, citing constituents' complaints about already high bills, after utilities proposed fixed charges as high as $128 per month.

Assemblymember Jacqui Irwin in January introduced CA AB1999 (23R), to stop the CPUC's plans, but Assembly Speaker Robert Rivas held it last month, saying he thought the agency's plan was sound.

Reaction: Environmental groups were lukewarm on the decision, saying it should have exempted low-income customers entirely.

Renewable energy and energy efficiency companies said it could discourage energy-saving measures. Edson Perez, California lead at Advanced Energy United, a trade group that includes Sunpower, NRG, Enel, Microsoft and Apple, called it "another blow to California’s clean energy goals."

What's next: Southern California Edison and San Diego Gas & Electric will start applying the charge in the fourth quarter of 2025, according to the decision. Pacific Gas & Electric will start in the first quarter of 2026. 

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