Public benefits charge supports energy efficiency in California

California Assembly Bill 1890, passed in 1996, restructured the electricity market in the state, and established a public goods charge on electricity purchases.

The charge is added to customer billings to cover costs related to services that a utility provides in the public interest. These services range from educational initiatives and funding for low-income customers to environmental and efficiency programs. Public benefits charges typically range from 2.5 to 5 percent of a customer's total energy bill.

Prior to deregulation, local utilities both collected and dispersed the funds, typically under the direction of regulatory agencies or public-interest organizations. Following the restructuring, municipal utilities were allowed to determine how to disperse the revenues they collected, while investor-owned utilities paid into a state fund.

The fund resulting from the public benefits charge supports many of California's energy efficiency programs. For the last two years, the California Public Utilities Commission and the California Board for Energy Efficiency have overseen the programs supported by these funds.