California electricity rates

California operates its own wholesale market, CAISO, and its wholesale energy is not unusually expensive. The state has enormous solar output, substantial hydro, geothermal and one remaining nuclear station. The cost sits in everything else.

Wildfire dominates. After utility equipment was found responsible for catastrophic fires, California's utilities undertook the largest grid-hardening programme in American history: burying thousands of miles of distribution line, replacing conductors, installing weather stations and fast-trip protection, and expanding vegetation management enormously. They also pay wildfire insurance and contribute to a state fund. All of it recovers through rates and none of it produces an additional kilowatt-hour.

Layered on that are transmission investment to reach remote renewables, legacy contract costs, and a set of public purpose programmes funded through the bill.

California's rate was essentially flat over the past year, which after several years of steep increases is itself notable.

The structural pressures have not gone away. Wildfire mitigation spending continues, and the costs shifted by rooftop solar onto remaining customers grow as more customers install panels, which is what drove the move from full retail net metering to an export-rate tariff.

The municipal utilities are dramatically cheaper than the investor-owned ones. SMUD and LADWP customers pay roughly half what some PG&E customers pay for the same service, and the boundary is worth knowing.

There is no individual residential retail choice. Most customers in investor-owned territory are served by a Community Choice Aggregator selected by their local government, which buys the energy while the utility delivers it.

Rate schedules are tiered and time-differentiated, so the marginal rate in the highest tier during peak hours is far above the state average. Load shifting is unusually valuable here, and the average rate is a poor guide to what an additional kilowatt-hour costs you.