Rider: Electricity Cost: CA vs U.S. — and TX

California has high income taxes.  Texas has none.  The workers in Texas do not have to pay bribes to work—in many places in California they have to pay extortion.  California is building a high speed rail from L.A. to San Fran, for $200 billion of taxpayers money.  Texas is building a high speed rail from Houston to Dallas, approximately 300 miles for NO tax dollars—all private funds.  Local cities will build the stations in exchange for development around the stations.

 

Per kWh in 2017   Residential               Commercial         Industrial        All sectors
         
CA cost of electricity $0.1877 $0.1516 $0.1308 $0.1590
         
U.S. cost of electricity $0.1301 $0.1055 $0.0679 $0.1038
         
CA % higher than U.S. avg. 44.3% 43.7% 92.6% 53.2%
         
TX cost of electricity $0.1140 $0.0840 $0.0533 $0.0840
         
CA % higher than TX 64.6% 80.5% 145.4% 89.3%

 

In Texas, in most places you have a choice of electricity providers—in California it is a government approved monopoly.  The free market works in Texas—in California socialism is a failure.

Laffer1

Electricity Cost: CA vs U.S. — and TX

Richard Rider, Rider Rants,  2/1/18

This month my home SDG&E electricity bill added a third price category — a “high usage charge.”  See below.

Actually I have no problem with such tiered pricing, but the high cost for EACH tier is breathtaking when compared with most other states.  Compare my SDG&E (and California) rates with the latest (November, 2017) numbers from the U.S. Energy Administration (EIA) provided below.

https://www.eia.gov/electricity/monthly/epm_table_grapher.php?t=epmt_5_6_a

MY SDG&E BILL  — JANUARY, 2018

Average Electricity Cost (kWh)

 

Your total usage is 396 kWh.

 
 
 
 Tier 1

0-374
kWh

   Tier 2

375-1,152
kWh

   High Usage Charge

≥ 1,153
kWh

 
23¢   40¢   47¢  
 
The pricing illustrated above represents an average cost per kWh for each tier.
Actual prices may vary.

======================================================================
Here are the EIA November, 2017 numbers, with comparisons of CA with the nation — and with Texas.  Note that my above SDG&E rates are CONSIDERABLY higher than the CA average.  My LOWEST tier is over 4 cents higher than the CA residential average.  The SDG&E top residential tier is over FOUR TIMES higher than the national average.

I throw in the Texas rates to remind us of the contrast between the hated Lone Star State and our Golden State.   One major factor driving the low Texas rates is that they have a market system of electricity production and sales. Customers can select their energy source, which keeps prices down.

Another major advantage Texans (and most other states) have is that electricity producers are relatively free to provide power from the most efficient energy source.  Low polluting natural gas is the preferred source — as Texas lacks the nutball alternative energy mandates that California voters seem to prefer.

Per kWh in 2017   Residential               Commercial         Industrial        All sectors
         
CA cost of electricity $0.1877 $0.1516 $0.1308 $0.1590
         
U.S. cost of electricity $0.1301 $0.1055 $0.0679 $0.1038
         
CA % higher than U.S. avg. 44.3% 43.7% 92.6% 53.2%
         
TX cost of electricity $0.1140 $0.0840 $0.0533 $0.0840
         
CA % higher than TX 64.6% 80.5% 145.4% 89.3%

NOTE: Keep in mind that these U.S. figures are the national averages — INCLUDING California. California has almost 1/8 of the entire nation’s population, so its uber-high rates skew the national average.  Compared with just the other 49 states (a comparison I can’t make with this data). the difference would be even HIGHER.

Of course, what saves most Californians (the ones living relatively near the coast) is our mild weather, and our very favorable solar energy conditions — a high number of sunny days coupled with taxpayer subsidies.  We’ve had a solar array on my home roof for years.

But these advantages are less important in the “commercial” (think shopping centers and office buildings) and ESPECIALLY the “industrial” categories.  In these categories, most of the energy use is unrelated to the climate, so the energy cost savings other states offer is a big factor in the decision by manufacturers to locate their business outside California.

Indeed, manufacturing tangible products on industrial sites (as opposed to software and services) is all but dead in the Golden State.  Such firms are viewed as “dirty industries.”

About Stephen Frank

Stephen Frank is the publisher and editor of California Political News and Views. He speaks all over California and appears as a guest on several radio shows each week. He has also served as a guest host on radio talk shows. He is a fulltime political consultant.