Updated: CPUC delays new rate plan


Issue Date: February 12, 2014
By Christine Souza

As a result of concerns first brought to the attention by Farm Bureau members in the Sacramento Valley regarding drought impacts, the California Public Utilities Commission has agreed to delay electric rate options that would encourage effective groundwater management. 

The California Farm Bureau Federation, working with Pacific Gas and Electric Co., requested that the CPUC delay by one year the ordered March 1 termination of AG-R and AG-V agricultural electricity rate schedules.

More than 1,000 agricultural customers served on AG-R and AG-V rates would have been transferred to different time-of-use electricity rates, forcing groundwater pumping into narrow windows of time, placing additional stress on local groundwater supplies, and decreasing the amount of water available for agricultural and residential customers.

In a letter to PG&E, CPUC Executive Director Paul Clanon granted the request that the termination of two agricultural electricity rate schedules be delayed until March 15, 2015.

"The expedited approval from the CPUC to defer the elimination of the schedules will make a tangible difference to affected growers," said Karen Norene Mills, CFBF associate counsel and Public Utilities Department director. "The quick turn-around to get the request into the CPUC can be attributed to our members who provided detailed, substantiated information about the effects the elimination of the schedules would have on their operations.

"PG&E's willingness to work with us to put forward the request in a timely manner assures customers will not be switched to other rate schedules unnecessarily.  We will be working with PG&E to make sure customers have the information they need about the deferral." 

Mills said members of the Butte County Farm Bureau contacted her, raising concerns about the combination of drought and the scheduled elimination of the AG-R and AG-V rates.

"Members collected specific information about the impacts, which we packaged and presented to PG&E for consideration," Mills said. "PG&E worked with us to quickly submit a request to the CPUC to defer elimination of the rates for a year."

She said the existing AG-R and AG-V schedules allow for longer, continuous off-peak periods during weekday hours, which, when coupled with weekend off-peak hours, accommodate certain irrigation practices that require minimum continuous water application.

Elimination of the schedules would bring significant changes in startup times for agricultural pumps, Mills said, leading to a concentration of Saturday morning start times for pumps. To be cost-effective and to provide the best opportunity for water coverage, she said, a longer run time is required than the interrupted off-peak periods during the week allowed on other schedules.

Allan Fulton, University of California Cooperative Extension irrigation and water resources farm advisor in Tehama, Glenn, Colusa and Shasta counties, warned that changes in the utility's pricing structure would encourage agricultural pumpers to concentrate their groundwater pumping to narrower windows of time, in order to utilize the lower electricity rates. This would result in groundwater management problems and lead to greater drawing down of the water table, Fulton added.

"If more agricultural water users are incentivized to turn on their pumps at the same time during narrower windows of time, it will lead to greater drawdown of the water table and put more water wells at risk of drawing air and not performing efficiently," Fulton said. "Rural homeowners with small domestic wells will be at greatest risk, because they are typically not constructed as deep as irrigation wells."

Pumping groundwater during a longer window of time is an important element to managing competition for groundwater and sustaining reliable and affordable supplies, Fulton said.

Farmer Rich McGowan, who grows prunes, almonds and walnuts north of Chico, said changes to the PG&E time-of-use rate system would cause "absolute havoc," especially now.

"Locally, we've been experiencing this problem on a smaller scale, even before the drought," McGowan said. "Some neighbors would turn on a pump and would notice if the farmer across the street turned his pump on at the same time, they both would draw down and suck air. It is not completely new to us, but the drought amplifies the problem greatly. We don't want to stress our very, critically important water source by starting all of these pumps on the same day."

Almond and walnut grower Ed McLaughlin of Durham called maintenance of the water table an important issue in his rural community for farmers and residents.

"We try to start off the (irrigation) season staggered, so one weekend my neighbor is irrigating and the next weekend we irrigate. It's become more complicated because they've shortened up the window of hours and forced us to be off-peak," McLaughlin said.

PG&E said it wants to find a workable solution and filed a joint request to the CPUC to defer the termination date for schedules AG-R and AG-V until March 15, 2015.

The utility said it appreciated Farm Bureau's prompt action to inform PG&E about the issue, and said it shares agricultural customers' concerns about maintaining electric rate options that support water conservation.

Pat Mullen, PG&E agricultural customer service region director, said the company is "doing everything we can to help our farmer and rancher customers during this extreme drought. Supporting this rate deferral was just one way to try to provide additional support and flexibility to our ag customers."

Mullen added that PG&E is considering additional staffing to handle the increased applications and service for pumps and wells, as well as additional energy efficiency programs and incentives to help customers reduce energy and water use.

"We are encouraging our ag customers to apply early if they are considering adding electrical service for new pumps and wells," Mullen said, directing people interested in adding service to www.pge.com under "new services."

(Christine Souza is an assistant editor of Ag Alert. She may be contacted at csouza@cfbf.com.)

Permission for use is granted, however, credit must be made to the California Farm Bureau Federation when reprinting this item.