Fixed charges are the new rate increase
Key takeaways
- PG&E, SCE and SDG&E added a $24 monthly fixed charge in March 2026 while cutting per-kWh prices 5–7¢.
- Fixed charges move money from low-usage homes to high-usage homes; the break-even is near the utility average.
- Apartments, single occupants and solar homes pay more; electric heat and EV owners pay less.
- Illinois, Michigan and Minnesota cases include requests to push fixed charges toward $20–$30.
The most important change to residential electric bills in 2026 was not a rate increase. It was PG&E, Southern California Edison and San Diego Gas & Electric moving to a $24 monthly Base Services Charge in March 2026 while cutting the per-kWh price by 5–7 cents. The total revenue was roughly unchanged. Who pays it was not.
The arithmetic
Say a utility collects $100 a month on average from each home. Under a pure per-kWh structure, a home using half the average pays about $50 and a home using double pays about $200. Add a $24 fixed charge and lower the energy rate to keep the average at $100: the small user now pays roughly $62 and the large user roughly $176.
Fixed charges move money from low-usage homes to high-usage homes. Apartments, single occupants, efficient homes and customers with solar pay more. Large houses, electric heat and EV owners pay less.
Why utilities want them
- Revenue stability. Usage falls with efficiency and rooftop solar; a fixed charge does not.
- Cost recovery logic. Poles and wires cost the same whether you use 200 kWh or 2,000.
- Electrification. Lower per-kWh prices make heat pumps and EVs cheaper to run.
Why consumer advocates fight them
- Removes the reward for conservation.
- Regressive unless income-tiered. California tiers the charge ($6 for CARE, $12 for FERA, $24 standard), which most other states do not.
- Hard to shop around. In choice states the fixed charge is on the non-shoppable delivery side of the bill.
Where it stands
California’s charge is in effect. Rate cases in Illinois, Michigan, Minnesota and several other states include requests to raise fixed charges from the $8–$15 range toward $20–$30. These show up in the tracker as part of a larger case; we flag them in the summary when the filing is specific.
Which side are you on
Find your usage in kWh on your bill, then use the estimator on your utility’s page. If you use less than the utility’s average shown on the page, a shift toward fixed charges costs you money; if you use more, it saves you money. The break-even is close to the average by design.
Why you should trust us
Every number on this site links to a primary source: EIA Form 861 for rates, state commission dockets for rate cases, and utility or state program pages for rebates. We don't sell electricity plans, solar or HVAC, and we don't take referral fees from anyone we mention. How we calculate this.