The California Public Utilities Commission (CPUC) plays a central role in determining the rates that customers pay for essential services such as electricity and natural gas. Through General Rate Cases (GRCs), the CPUC oversees a process in which utilities must present evidence to justify their forecasts of operational and maintenance costs. These proceedings are described as some of the most important and complex handled by the agency.
Large investor-owned utilities, including Pacific Gas and Electric Company, Southern California Edison, and San Diego Gas & Electric, are required to file GRCs every four years. The process is divided into two phases: Phase 1 establishes the total revenue requirement needed by a utility to operate and maintain its infrastructure, while Phase 2 determines how this amount is distributed among various customer groups.
Leuwam Tesfai, Deputy Executive Director for Energy and Climate Policy at the CPUC, provided insight into Phase 1 of GRCs. According to Tesfai, “GRCs are comprehensive and highly technical. They involve forecasts of nearly every aspect of a utility’s operations ranging from infrastructure and safety investments to customer service and cybersecurity.” She explained that more than 30 staff members from diverse disciplines—including engineers, financial analysts, policy experts, attorneys, and Administrative Law Judges—are assigned to each case.
A typical GRC generates extensive documentation. Utilities submit detailed applications with historical data and future spending forecasts covering areas such as infrastructure upgrades, wildfire mitigation efforts, customer service programs, IT systems security measures, employee training costs, insurance needs, legal requirements, and regulatory compliance. The preparation of these materials often begins over a year before filing.
Intervenors—including consumer advocates, local governments, and environmental organizations—play an active part by submitting expert testimony that reviews or challenges utility proposals. In large cases, more than 20 intervenors may participate.
Public participation is also encouraged through forums held both virtually and in person across affected service areas. Customers can provide direct input at these events or submit written comments online; all feedback becomes part of the official record considered during decision-making.
Formal evidentiary hearings allow parties to cross-examine witnesses representing utilities or intervenors. Testimony from these sessions is reviewed by Administrative Law Judges (ALJs) when crafting recommendations for final decisions.
Within the CPUC itself, specialized teams evaluate different aspects of each case: staff analyze proposed revenue requirements using financial models; distribution planning experts review grid modernization plans; safety personnel assess wildfire risk reduction strategies; affordability analysts examine potential impacts on customer bills.
The entire process typically takes about 18 months from initial filing to final decision. During this period CPUC staff conduct technical analysis and modeling work; review testimony; participate in hearings; help draft proposed decisions; and support adoption at public voting meetings.
Tesfai emphasized the importance of transparency throughout: “At its core,” she stated,”a GRC is about evidence and accountability…we do so through an open and transparent process in which the voice of the consumer is very necessary and solicited.”
Each GRC decision reflects months of technical analysis combined with stakeholder input aimed at ensuring Californians receive safe utility service at fair rates.
