$36.24 — twice a year. This $72.48 annual payment will be found on SDG&E residential bills starting in April 2014. It is called the “California Climate Credit” and it reflects savings achieve by utilities for reducing the amount of carbon that they generate. It is part of a the cap-and-trade program fashioned by California regulators, which requires the state’s largest emitters to acquire permits for every ton of pollution they emit. Regulators are attempting to put a price on carbon to help level the playing field for carbon-free energy sources for electricity generation, such as renewables like wind and solar. They also are hoping it will help fund energy efficiency programs to reduce the need for new power plants and encourage customers to use less. It also puts a hard limit on pollution to ensure California achieves AB 32’s emissions reduction target.
Every household within SDG&E’s service territory will receive the same amount of bill credit. Regulators wanted customers using use less electricity to not be penalized by receiving a smaller credit, which would otherwise blunt incentives for efficiency and conservation. This is particularly important to protect low-income households – who, by necessity, spend more of their income on basic needs like energy and tend to conserve more than wealthier households as well as for those customers who have already taken aggressive steps to conserve energy. Hopefully, some customers will see fit to use this “found” money to purchase energy efficiency items, like efficient LED lights or a programmable thermostat, that will further reduce their bills while also reducing carbon pollution.
Ideas about how to parlay those climate credits into further savings can be found here and here. For more information about this credit, SDG&E has filed a request with regulators that details how the credit works.