Posted on March 1, 2012

PG&E Proposes New Electric Rate to Foster California Jobs

By Jonathan Marshall

Fresno Mayor Ashley Swearengin

Fresno Mayor Ashley Swearengin: “PG&E’s program will help jump-start an economic recovery that generates the jobs and growth we need for healthier communities.”

It’s no secret that California remains hard hit by the national recession, with an unemployment rate (11.1 percent) that is more than two and a half points above the U.S. average. In many areas, the jobless rate lingers near depression levels, like Fresno and San Joaquin Counties at about 16 percent.

High unemployment is bad not only for work seekers, but for the social fabric of our communities, for the tax base on which vital government services are funded, and for businesses that suffer slumping sales.

As a central part of communities throughout Northern and Central California, touching 15 million people with its gas and electric services, PG&E is looking for ways to help jump-start job growth and economic development in its region. It unveiled one piece of its emerging plan today (March 1) in a filing with the California Public Utilities Commission.

PG&E is asking state regulators for permission to offer a new electric rate aimed at helping attract jobs to California or retain them here. It would apply to larger employers — PG&E customers with loads of 200 kilowatts or more — who attest that they would otherwise locate or expand in other states, or close their existing California operations.

Tom Bottorff

PG&E Senior Vice President Tom Bottorff: “Affordable, reliable power is more important than ever as an enabler of business and employment development in our state.”

The proposed Economic Development rate would provide those businesses with a 12 percent rate reduction for five years. An enhanced option, with a reduction of 35 percent, would apply in counties with unemployment rates that are at least 25 percent above the state average.

Surveys of corporate executives and site location consultants confirm that power costs are an important factor in determining how attractive an area is to businesses. PG&E’s electric rates for large industrial customers, some of which have the flexibility to relocate, are significantly higher than those charged in several other western states.

Tom Bottorff, PG&E’s senior vice president for regulatory relations, explained the rationale for the proposed new rate.

“Affordable, reliable power is more important than ever as an enabler of business and employment development in our state,” he said. “As a key contributor to California’s economy, PG&E is committed to helping create and retain jobs here by offering appropriate incentives that will enhance our state’s competitiveness and make it ‘golden’ again.”

Fresno Mayor Ashley Swearengin also welcomed the proposal.

“By expanding our local businesses and attracting employers back to hard-hit communities in California, PG&E’s program will help jump-start an economic recovery that generates the jobs and growth we need for healthier communities,” she said. “This program provides hope not only to Fresno, but to communities throughout Northern and Central California that need help revitalizing their economic base. This will be good for all of California.”

The new economic development rate would replace an existing program that PG&E began offering in 2005. The current program’s rate reduction has declined over time and it is scheduled to sunset at the end of 2012.

Email Jonathan Marshall at jonathan.marshall@pge.com.

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"PG&E" refers to Pacific Gas and Electric Company, a subsidiary of PG&E Corporation.
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