MCE’s prices are manipulated so that they are just below Pacific Gas and Electric's prices. MCE’s claim that natural gas costs are driving up its prices is not supported by the market.
Natural gas futures are relatively stable over the coming years, and gas-fired generation is increasingly available as California shifts to renewables. None of this supports MCE’s 25% year-over-year residential price increase.
The IJ was misled into legitimizing MCE’s increase when citing PG&E’s rising costs for “upgrading technology and electric and gas infrastructure” and “enhanced wildfire safety.” Those have nothing to do with generating electricity, the only item MCE provides on monthly electricity bills.
However, citing PG&E’s costs helps MCE obfuscate the truth. MCE uses PG&E’s declining monthly exit fees (assessed against all customers) as a windfall — MCE increases its generation prices by a commensurate amount — setting its total cost of service to just below PG&E’s price, about 38-cent savings per month for a typical household starting July 1.
Consumers may dislike PG&E, but MCE is no white knight. While it enjoys softball media coverage, MCE’s regulatory filings reveal it has delivered enough fossil-fired power to outpace PG&E’s greenhouse gas emission rate by more than 70% in some years. Since its launch, MCE has failed to disclose 1.9 billion pounds of GHGs in fossil-fired power it sold as “clean energy.”
The IJ is long overdue to carefully examine MCE, an agency that delivers minimal cost savings, environmental-damaging energy, and supports Shell with $75 million of new contracts over the past year after claiming it severed business ties with the oil giant.