California's New Fixed Charge, Explained

If your PG&E, SCE, or SDG&E bill grew a new line item called “Base Services Charge” sometime in the last year, that’s not a mistake and it’s not going away. It’s the state-mandated income-graduated fixed charge, and as of March 2026 (when PG&E finished rolling it out last) it’s now live on every residential bill from all three major utilities.

Here’s exactly what it is, why it exists, and whether it changes your rate-plan math.

Where This Charge Came From

California’s legislature passed AB 205 in 2022, directing the CPUC to design a fixed charge that scales with household income rather than charging every customer the same flat connection fee. The CPUC adopted the specific structure in Decision 24-05-028 in May 2024. The stated goal was revenue neutral: pull some of the utility’s fixed grid costs (poles, wires, meters, customer service) out of the per-kWh rate and into a flat monthly charge, then lower the per-kWh rate to offset it.

It rolled out on different timelines by utility: SDG&E in October 2025, SCE in November 2025, and PG&E last, in March 2026.

The Three Tiers

The charge is the same basic structure across all three utilities, though exact dollar amounts vary slightly by utility:

Tier	Who qualifies	Typical monthly charge
Tier 1	Enrolled in CARE	About $6
Tier 2	Enrolled in FERA, or in deed-restricted affordable housing	About $12
Tier 3	Everyone else	$24.15

Note what this isn’t: the utilities aren’t verifying your household income directly. Tier assignment rides on whether you’re already enrolled in CARE or FERA (the existing low-income discount programs) or live in deed-restricted affordable housing. If you qualify for CARE or FERA and haven’t enrolled, you’re paying the Tier 3 charge for no reason. That’s the single easiest fix available to anyone reading this.

What You Got in Exchange

The per-kWh rate on every residential plan dropped to offset the new fixed charge, roughly 5-7¢/kWh statewide according to the CPUC’s own fact sheet, with individual utilities describing it as around a 10% reduction in the volumetric rate. The reduction applies across all time-of-use periods, not just off-peak.

This is why the charge is genuinely revenue neutral in aggregate even though it doesn’t feel that way to every household. If you use very little electricity, the fixed charge can outweigh what you save on a lower per-kWh rate. If you use a lot of electricity (running an EV, a heat pump, or central AC through summer), the lower per-kWh rate usually saves you more than the new fixed charge costs.

Solar Doesn’t Make It Go Away

The Base Services Charge applies to every residential account regardless of solar generation. You can’t offset it with export credits, and it isn’t waived if your system produces more than you consume in a given month. On PG&E specifically, it replaced the old Minimum Electric Charge that some solar customers were used to seeing, and for many solar households it landed higher than that old minimum did.

If you’re modeling solar payback for 2026, don’t project the fixed charge away. Every simulation should include roughly $24.15/month (or your CARE/FERA tier amount) as a floor on the bill, on top of whatever export economics you’re assuming.

Note that this charge is not solar-specific; every residential customer pays it. Some other states go further and charge fees that apply only to solar owners. See do utilities charge extra for solar? for how that works in Alabama and a few other states.

Who Actually Wins and Who Pays More

The CPUC designed this specifically so CARE-enrolled households, who tend to use less electricity on average, come out ahead: the $6 fixed charge is well below what most flat per-customer charges used to run, and the lower per-kWh rate stacks on top.

Households that are electrifying (adding an EV or a heat pump) generally benefit too, since the volumetric savings scale with usage while the fixed charge doesn’t.

The group most likely to see a small bill increase: non-CARE households with low usage, for example a small apartment or a vacation home that sits mostly empty. For that household, the jump from whatever the old minimum charge was to $24.15/month can outweigh a modest per-kWh reduction. It’s not a large amount in absolute dollars, but it’s a real shift in who subsidizes the grid’s fixed costs.

The Politics Aren’t Settled, But the Billing Is

Two 2024 legislative efforts to cap or roll back the charge (AB 1999 and SB 1326) both stalled before passage. As of mid-2026, there’s no indication any of the three utilities have paused or reversed the rollout. Treat this as a permanent fixture of your bill going forward, not a pilot program that might disappear.

What To Actually Do About It

Confirm your CARE/FERA enrollment status. This is the only lever that changes which tier you’re on. If your household income qualifies and you’re not enrolled, that’s real money left on the table every month.

Re-run your rate plan comparison. The per-kWh reduction changed the math on which plan is cheapest for your usage pattern, even if the plan names didn’t change. See our PG&E, SCE, and SDG&E breakdowns for the current per-kWh numbers on each utility’s plans.

Update your solar payback model. If you’re comparing rooftop or balcony solar quotes, make sure the payback calculation assumes the fixed charge as a permanent floor, not a number that shrinks with a bigger system.