3 ways to fix California's utility spending problem — if lawmakers act

California lawmakers are considering a bill, SB905, meant to address the state's high electric rates, which are now roughly twice the U.S. average. The bill targets spending by the state's big three utilities — Pacific Gas & Electric, Southern California Edison, and San Diego Gas & Electric — which together plan to spend well over $100 billion by 2030 on grid upgrades and wildfire prevention. Those costs get passed on to customers through monthly bills.

The bill would do three things. It would lower the guaranteed profit rate utilities earn on certain spending, especially wildfire-safety work like burying power lines, since that spending already reduces risk and borrowing costs for utilities. It would also push utilities to borrow money (or use state-backed loans) to cover some costs instead of charging customers up front, which can lower what shows up on bills, though savings would take years to appear. Finally, it would set up new performance goals by 2028 for things like grid reliability, lower emissions, and getting more use out of existing power lines — though for now there's no financial reward attached to hitting those goals.

None of this changes anything on your utility bill immediately. The bill still has to survive final negotiations before the legislature's Aug. 31 deadline, and utilities are opposing it. If it does become law, the idea is that costs for electricity — and eventually the case for switching to heat pumps or electric vehicles — could look better over time, but nothing is decided yet.