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In a move aimed at curbing rising electricity costs while upholding California’s climate goals, Governor Gavin Newsom signed an executive order designed to offer bill relief to residents across the state. The order, announced this week, aligns with California’s ambitious targets of reaching carbon neutrality and 100% clean electricity by 2045. The measure comes just as Californians received an average credit of $71 on their October electric bills, part of the California Climate Credit funded through the state’s Cap-and-Trade program.
“We’re taking action to address rising electricity costs and save consumers money on their bills,” Governor Newsom said. “California is proving that we can address affordability concerns as we continue our world-leading efforts to combat the climate crisis.”
California has traditionally maintained lower average electricity bills compared to other states, thanks to longstanding energy efficiency efforts. However, recent years have seen bills increase, partly due to utility wildfire mitigation costs driven by the climate crisis. These rising expenses, along with various programs implemented over time, have placed a growing burden on residents.
Governor Newsom’s executive order focuses on multiple areas to help manage and reduce electric costs for Californians. Key initiatives include directing the California Public Utilities Commission (CPUC) to review underperforming programs and redistribute any unused funds as bill credits. It also calls on the California Air Resources Board (CARB) and CPUC to enhance the California Climate Credit, which appears on bills twice a year. Additionally, the order tasks the CPUC with exploring federal funding to offset costs and reviewing electric ratepayer-supported programs to find potential long-term savings. Lastly, the order mandates the Office of Energy Infrastructure Safety, in collaboration with the CPUC, to evaluate utility wildfire investments, ensuring that safety measures are both effective and cost-efficient.
This executive order builds on recent CPUC actions to reshape residential electricity pricing, offering direct financial relief to consumers. It also follows California’s Strategic Reliability Reserve, a state-funded initiative to ensure grid stability during extreme weather, which helps maintain reliability without increasing costs for ratepayers. Through these efforts, the state aims to alleviate the rising costs of electricity while maintaining its commitment to climate goals.
The executive order received strong backing from state legislative leaders. Assembly Speaker Robert Rivas emphasized the importance of oversight in energy programs, saying, “Californians expect us to take a hard look at their monthly energy and electricity bills and deliver reduced costs and savings for the long-term.” Senate President pro Tempore Mike McGuire echoed this sentiment, highlighting the need for regulatory agencies to manage ratepayer impacts effectively.
As California continues to lead in clean energy and affordability, the CPUC’s newly implemented billing structure marks a shift for consumers. Required by Assembly Bill 205, this change reduces electricity bills for lower-income households and those in areas hardest hit by extreme weather, while supporting the state’s transition to clean energy. By moving existing infrastructure costs into a separate “flat rate” line item, residential customers will see lower per-unit electricity prices, making it more affordable to electrify homes and vehicles regardless of income or location.
Set at the lower end of stakeholder proposals, the flat rate of $24.15 per month ensures fair cost-sharing without imposing new fees, aligning California’s utilities with trends seen in other states. This updated structure, set to take effect in late 2025 and early 2026, allows Californians to benefit from more transparent billing and lower costs as the state advances its energy goals.
