Letter to the Editor | Mahmud: CPA Did Not Violate Ratemaking Terms

A letter from Diana Mahmud, South Pasadena City Councilmember and Clean Power Alliance Chair

PHOTO: Eric Fabbro | SouthPasadenan.com News | Diana Mahmud, City Councilmember and CPA Chair

I am writing in response to the article published on September 20 by Ben Tansey regarding Clean Power Alliance’s recent rate change.

The article correctly reports that the recent CPA rate change resulted in a 3% decrease in residential and commercial rates for South Pasadena customers.

Unfortunately, the use of the word “violation” in the article’s headline suggests that there is some sort of wrongdoing in CPA’s ratemaking process, which is simply not true.

While CPA has to date benchmarked its rates to Southern California Edison’s rates, the only deviation thus far has affected 1,800 large commercial customers, none of whom are located in South Pasadena. The article does not disclose that such customers represent a tiny fraction (less than one half of 1 percent) of CPA’s approximately one million customers. The article does correctly note that the CPA board deviated from the benchmark to avoid having residents subsidize CPA’s cost of providing electric service to the large commercial customers. I believe South Pasadena residents would strongly support this result.

CPA just completed its rollout of service to 29 cities and 2 counties in May, less than five months ago. During rollout, it has been important for us to permit our customers to compare our rates to SCE’s, to better inform their choice. We anticipate modifying our rate structure at some point in the future, but only after careful deliberation and analysis of what is best for our ratepayers and our organization’s commitment to offering cleaner power at competitive rates.

A final point of clarification: CPA will not “pass through” whatever costs the California Public Utilities Commission approves in SCE’s pending General Rate Case. These costs are related to SCE’s operations, not energy procurement. CPA procures energy which is then delivered to customers by SCE through its distribution and transmission systems. It is important to separate the costs of energy from the costs of operating and maintaining the electrical grid.

Sincerely,

Diana Mahmud

Chair, Clean Power Alliance

 

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