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Edison Begins Year with Lower Rates
By Dan Geis Due almost exclusively to much lower-than-expected natural gas prices, customers of Southern California Edison will enjoy an average rate decrease of 4.2% beginning on January 1, 2010. Agricultural and water pumping customers will see rates fall by an average of 4.5%. Electric utilities such as Southern California Edison forecast generation costs up to one year in advance, and such predictions are highly dependent on the commodity price of natural gas. This is particularly true for Edison, which is much more dependent on natural gas than PG&E, which has more significant hydroelectric generation. The falling price of gas throughout 2009 caused Edison to over-collect revenues, which were incorporated into the lower rates at the beginning of the year. This contrasts with PG&E decision (see previous article) to return these overcollections in a one-time refund.
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