San Francisco Chronicle
by Ryan Young and Alex Jackson
The millions of Californians receiving the first “climate credit” on their electricity bills in April have the state’s landmark climate and clean energy law to thank. Not only is the Global Warming Solutions Act, known as AB32, reducing the amount of carbon pollution dumped into the atmosphere and improving the air we breathe, it also is literally paying off for customers of Pacific Gas and Electric, Southern California Edison and San Diego Gas and Electric.
The California climate credit ranges from roughly $30 to $40 depending on the utility supplying your power. It will be distributed every year in April and October. It exemplifies California’s balanced approach to shift from fossil fuels to clean, low-carbon energy under AB32 by holding polluters accountable and ensuring households aren’t left with the cleanup bill.
One way AB32 is moving us off dirty energy is a cap-and-trade program that requires the state’s largest polluters – like power plants – to acquire permits to emit carbon into the air. Over time, those permits grow scarcer, requiring facilities to find ways to pollute less. In a landmark decision in 2012, the California Public Utilities Commission voted to rebate the majority of proceeds from pollution permits allocated to the state’s three investor-owned utilities, which together serve more than two-thirds of the state’s electricity demand, to their residential customers.
As environmental and consumer advocates, we pushed hard for this outcome. It ensures electricity rates reflect the cost of pollution to encourage cleaner alternatives, but protects households’ bottom lines. Now, two years later, with the cap-and-trade program up and running, California households are about to reap the dividends.
While the credits vary slightly by utility, every household within each utility’s service territory will receive the same amount – regardless of how much electricity the household uses. This ensures those who reduce their energy use are not penalized by receiving a smaller credit, and maximizes the benefit for low-income households – who spend more of their income on basic needs like energy and who of necessity conserve more energy than wealthier families.
The climate credit also offers an unprecedented opportunity for customers to slash their energy bills even further while reducing reliance on dirty energy. How? By investing the amount of the credit, or even part of it, in a low-cost energy efficiency option that will pay off in lower bills for years to come.
If you’re still using old-fashioned, power-guzzling lightbulbs, for example, you can use your climate-credit savings to buy a few energy-saving compact fluorescent or LED bulbs. You’ll easily cut your electric bills enough over time to cover the initial cost, essentially doubling your climate dividend. Not only will this reduce your energy bill, but these small steps also could make a significant difference in avoiding dirty power if millions of utility customers using their credits do the same.
When the “climate credit” appears on your utility bill in April, it should be a good reminder that we don’t have to choose between affordable, reliable energy and preserving the health and prosperity of our state for generations to come. AB32 is moving California into a brighter, cleaner, more efficient future. Let’s join the effort by using our climate credits to get us there even faster.