SAN FRANCISCO–The California Public Utilities Commission (CPUC) today said that large commercial and industrial business customers of Pacific Gas and Electric Company (PG&E) can now take advantage of a new rate. The new rate, called Peak Day Pricing (PDP), is intended to reduce electricity demand during peak hours and, for those customers who change their energy usage, it could also reduce their electricity bills. PG&E’s large business customers are encouraged to contact PG&E as soon as possible for information to determine if PDP rates are right for them.
On May 1, most large customers with an energy demand greater than or equal to 200kW were switched to the new PDP rate. Customers have the choice to opt off the rate and remain on a Time of Use rate. The PDP rate impacts approximately 2,200 PG&E customers on rate schedules E-19, E-20, E-37, and A-10, which includes manufacturers, hotel chains, school districts, hospitals, and office buildings among others, but not residential customers. PDP provides a lower rate from May through October in exchange for a higher rate from 2 p.m. to 6 p.m. on nine-to-15 peak event days per year. This new rate could lower a customer’s bill from May through October if they sufficiently reduce their electricity use from 2 p.m. to 6 p.m. on peak event days. Other customers will save simply by being on the rate. PG&E will notify customers the day before a peak event day, so that they can plan accordingly.
PG&E may call a peak event day when they expect the demand for electricity the next day to be exceptionally high. In the past, customers received a “Flex Alert” requesting that they lower electricity use. Businesses on PDP that altered their use in response to “Flex Alerts” now have an opportunity to save money by taking similar actions on PDP days.
The intent of this rate is to reduce demand during those times of the year when demand for electricity is the highest. If customers can collectively reduce the peak demand for electricity, they can help improve reliability of the grid, decrease the need for additional power plants, and reduce greenhouse gases. Although PDP is currently only available to very large usage customers of PG&E, all non-residential customers will have rate options by the end of 2011.
Although this new rate could lower a customer’s bill, it might not be the best option for all customers. Some customers could see increases to their bill if they are unable to respond properly during PDP days. Customers may choose not to participate in PDP now and remain on their existing rates, but the customer is responsible for calling PG&E and declining the new rate. Since this is a new rate, the CPUC has asked PG&E to offer bill protection for the first year. Bill protection ensures that a customer will not pay more over the course of the whole year than they would on their otherwise applicable rate. If their annual costs are higher on the PDP rate, then their account will be modified to cover the difference.
The CPUC encourages large business customers to contact their PG&E Account Manager, or call PG&E’s PDP number at 800-987-4923, or visit www.pge.com/pdp for more information and to determine if PDP rates are right for them.
