What you need to know: The Governor signed an executive order to help curb rising electricity costs and provide electric bill relief.

SACRAMENTO - On Oct 30, 2024, Governor Gavin Newsom signed an executive order designed to reduce electric costs for Californians. 

The Governor’s action encourages electric bill relief while maintaining the state’s commitment to achieving carbon neutrality and 100% clean electricity by 2045. The action comes as millions of Californians received an average credit of $71 on their October electric bills from the California Climate Credit, provided by the state’s Cap-and-Trade program.

We’re taking action to address rising electricity costs and save consumers money on their bills. California is proving that we can address affordability concerns as we continue our world-leading efforts to combat the climate crisis. - Governor Gavin Newsom

Tackling rising electricity costs

While California has been successful in keeping electric bills lower than many other states on average thanks to decades of work advancing energy efficiency standards, Californians have seen their electric bills rising in recent years. A major driver has been critical utility wildfire mitigation efforts that have accelerated to match the pace of the climate crisis, as well as several programs added over time. 

The Governor’s executive order addresses both of these cost drivers by zeroing in on some programs that could be inflating customer bills and evaluating utility wildfire mitigation expenses for potential administrative savings. 

The Governor’s executive order:

- Encourages electric bill relief. The executive order asks the California Public Utilities Commission (CPUC) to identify underperforming programs and return any unused energy program funds back to customers receiving electric and gas service from private utilities as one or more credits on their bills. 

- Maximizes the California Climate Credit. The executive order directs the California Air Resources Board (CARB) to work with the CPUC to determine ways to maximize the California Climate Credit, which is a twice annual credit that shows up on many Californians’ electric and gas bills in the spring and fall and is funded by the state’s Cap-and-Trade program.

- Manages and reduces electric costs for the long-term. The executive order asks the CPUC to evaluate electric ratepayer supported programs and costs of regulations and make recommendations on additional ways to save consumers money. It also asks the CPUC to pursue any federal funding available to help lower electricity costs for Californians. Additionally, the executive order directs the California Energy Commission (CEC) to evaluate electric ratepayer-funded programs and identify any potential changes that could save Californians money on their bills. 

- Smarter wildfire mitigation investments. The executive order directs the Office of Energy Infrastructure Safety, and requests the CPUC, to evaluate utility wildfire safety oversight practices and ensure that utility investments and activities are focused on cost-effective wildfire mitigation measures. 

Text of the executive order is available here.

In addition to the Governor’s action, earlier this year, the CPUC approved a proposal to reduce the price of residential electricity through a new billing structure authorized by the state Legislature. This follows actions in recent years such as providing direct relief to customers and using state funds, rather than ratepayer monies, to develop a Strategic Reliability Reserve to maintain electric grid reliability during extreme conditions.

The Governor welcomes partnership with the legislature to further additional actions that will address electric bill affordability.

“Californians expect us to take a hard look at their monthly energy and electricity bills and deliver reduced costs and savings for the long-term,” said Assembly Speaker Robert Rivas (D-Salinas). “I support increased oversight efforts, because regulators must ensure energy programs are implemented effectively and responsibly. The Governor’s action today is another step forward to lessen households’ total energy burden and lower the cost of living in our state.”

“Rising electricity costs are impacting Californians and their quality of life,” said Senate President pro Tempore Mike McGuire (D-North Coast). “The state, including its regulatory agencies, needs to buckle down and blunt the expanding fiscal impacts on ratepayers. This is an important start by Governor Newsom, and the Senate plans to double down on this progress in the months ahead.”