The Little Hoover Commission convened on February 27, 2025, to discuss pressing issues surrounding California's electricity costs. The meeting focused on various strategies to manage utility financing and reduce the financial burden on consumers.

The session began with a discussion on the current practices of the Public Utilities Commission (PUC) regarding utility requests for funding. It was noted that while some requests are challenged, many go unexamined and are approved by default. This practice raises concerns about the need for stricter scrutiny of all utility requests, not just those that face opposition.

One significant proposal discussed was the concept of securitization, which involves issuing bonds backed by ratepayer payments. This method could potentially allow utilities to apply up to $15 billion in securitization for wildfire mitigation and customer grid connections, resulting in substantial savings for consumers—estimated at over 40% compared to traditional financing methods.

The meeting also highlighted the potential for public ownership of new transmission projects. With California needing an estimated $54 billion in new transmission to meet decarbonization goals, public financing options could significantly lower costs. The discussion emphasized that the current investor-owned utility model is the most expensive way to finance these projects.

Another key topic was the state's cap-and-trade program, which generates approximately $8 billion annually. Participants advocated for a greater share of these funds to be returned to utility ratepayers, arguing that this would alleviate some of the financial pressures faced by consumers.

The commission also explored the idea of constraining utility spending proposals to align with inflation. This approach aims to enforce discipline in utility spending and prioritize essential services over discretionary expenditures.

Low-income customer relief was another critical point of discussion. While California offers substantial discounts for low-income electric customers, the same level of support is not mirrored in natural gas discounts. The commission called for an increase in gas discounts to better support low-income households, particularly as electrification efforts continue.

The meeting concluded with a discussion on net metering reforms, particularly regarding the duration of legacy tariff protections for solar customers. Suggestions included reducing the protection period from 20 years to 10 years to address cost-shifting issues as more customers adopt solar energy.

Overall, the meeting underscored the urgency of addressing California's electricity costs through innovative financing solutions, regulatory reforms, and enhanced support for low-income customers. The commission plans to continue exploring these topics in future sessions, aiming to implement strategies that will lead to more equitable and sustainable energy solutions for all Californians.