How to Read Your California Electric Bill
A California electric bill is one of the more confusing documents most households receive — a mix of generation and delivery charges, a fixed monthly fee, a baseline allowance, time-of-use pricing, and sometimes a separate community-choice supplier. This guide breaks down every part in plain English, using current CPUC definitions, and shows you how to pull out the two numbers that actually matter: your usage (kWh) and your real cost per kilowatt-hour.
Written by Cali Energy Research Team · Fact-checked by Cali Energy, CSLB #1032379 — B, C-10, C-39 · Last reviewed: August 3, 2026
This guide focuses on residential bills from California’s large investor-owned utilities — PG&E, SCE and SDG&E. LADWP and other municipal utilities use different bill formats, charges and rate structures.
- Your bill splits into generation (making the power) and delivery (moving it) charges, plus fees.
- A fixed Base Services Charge (about $24.15/mo; less for income-qualified) covers grid connection.
- A baseline allowance prices a first block of usage lower; it varies by climate zone and season.
- Watch two different “cents per kWh”: your all-in average and your marginal rate.
The two big charge groups: generation vs delivery
Almost everything on a California bill falls into one of two buckets, and understanding them explains most of what you’re paying for.
Generation (supply)
The cost of actually producing the electricity you used. If you have a Community Choice Aggregator, this part comes from them, not the utility (see below).
Delivery (transmission & distribution)
The cost of moving that power to your home over the grid and maintaining the poles, wires and equipment — billed by your utility (SCE, PG&E, SDG&E).
As an illustration of how the dollars split, one SCE cost breakdown for a reported period put procurement (generation) near 40%, transmission & distribution near 50%, and public-purpose & other charges near 10%. Treat that as an example composition for that period, not a universal split — your mix shifts with your utility, rate plan and how much you use.
Source: EIA — what makes up electricity prices; composition example per SCE reporting.
The fixed Base Services Charge (AB 205)
Since late 2025, California restructured bills so the cost of keeping your home connected — meters and grid equipment — is separated from your variable energy use and covered by a fixed daily fee, the Base Services Charge. Under the CPUC decision implementing AB 205, PG&E, SCE and SDG&E share the same amounts:
| Customer | Amount |
|---|---|
| Standard residential | ~$24.15 / month |
| FERA (income-qualified) | ~$12 / month |
| CARE (income-qualified) | ~$6 / month |
Because this part is fixed, it doesn’t fall when you use less electricity — a key thing to understand when you model solar, which reduces variable charges but not the Base Services Charge.
Source: CPUC — electric costs · CARE/FERA. Confirm current amounts on your bill.
The baseline allowance
The large CPUC-regulated investor-owned utilities give residential customers a baseline allowance on applicable rate plans — a first block of electricity billed at the lowest rate, meant to cover basic needs. It’s set by your climate zone (hotter zones get more) and differs between a summer and a winter allocation. Use above baseline is billed at higher rates. On a tiered plan you’ll literally see usage split into baseline and above-baseline blocks.
Source: CPUC.
Time-of-use: when you use it matters
Many customers of California’s investor-owned utilities are now on a time-of-use (TOU) rate — though plan design and opt-out rules vary — where the price of a kWh depends on the time of day, highest during the late-afternoon-to-evening peak and lower off-peak. Your bill shows usage and price by TOU period. This is central to solar and battery value, because it changes what the power you offset (or store) is worth. See SCE time-of-use plans compared.
kWh vs kW — energy vs power
Two units get confused. A kilowatt-hour (kWh) is a unit of energy — how much electricity you used — and it’s what residential bills charge for. A kilowatt (kW) is power — the rate of use at an instant. Residential customers rarely see demand (kW) charges; those are more common on commercial accounts. When sizing solar, you care about annual kWh.
If you have a Community Choice Aggregator (CCA)
Many Californians now get their electricity generation from a Community Choice Aggregator — a local government program that buys power on residents’ behalf — while the utility still handles delivery, metering and billing. On a CCA bill you’ll see the generation line from the CCA and the delivery and other charges from your utility, often with a reconciliation charge (PCIA). It’s the same electrons; just two entities on the bill.
Source: CPUC — CCA FAQ.
All-in average vs marginal rate
Divide your total bill by your kWh and you get your all-in average cost per kWh — useful for understanding a bill, but it blends fixed charges, taxes and credits, so it’s not what one more kWh costs. Your marginal energy rate — the per-kWh price for the relevant TOU period on your plan — is the right number for valuing solar or a battery. The tool below shows both.
Find your cost per kWh
Two different “cents per kWh” numbers matter, and people confuse them. This tool shows the all-in average and explains the marginal rate.
Cost-per-kWh helper
Enter this month’s totals from your bill.
The all-in average includes fixed charges and taxes, so it runs higher than the marginal energy rate. Both are useful for different questions.
Reading it for solar: the two numbers to grab
If you’re evaluating solar or storage, ignore the noise and pull two things off your bills: your annual kWh (add up 12 months — this sizes a system) and your marginal rate by TOU period (this values what solar offsets). A careful analysis also weighs your fixed charges, hourly/seasonal usage profile, any export credits, and CCA/PCIA line items — but annual kWh and marginal rate are the two starting numbers. See how many panels you need and how much a panel produces.
Discounts: CARE, FERA and Medical Baseline
California offers bill assistance you may qualify for: CARE and FERA give income-qualified households discounts (and the lower Base Services Charge shown above), and Medical Baseline provides additional low-cost allowance for households with qualifying medical needs. These appear as separate lines or adjusted rates on the bill.
Source: CPUC — CARE/FERA.
Sources & methodology
Primary sources: CPUC — Electric costs & the Base Services Charge (AB 205) · CPUC — CARE/FERA Program · CPUC — Community Choice Aggregation (CCA) FAQ · U.S. EIA — Electricity explained: factors affecting prices. Charge names and the Base Services Charge follow current CPUC guidance; the cost-composition percentages are an illustrative breakdown for the cited reporting period, not a universal split — your own bill varies by utility, rate plan and usage. Dollar figures and program terms change — confirm current amounts on your bill and the CPUC site.
Frequently asked
What are the main parts of a California electric bill?
Two big charge groups: generation (the cost of producing the electricity, which may come from a Community Choice Aggregator) and delivery (moving it over the grid, billed by your utility). For residential customers of the large investor-owned utilities (PG&E, SCE, SDG&E), the bill may also include a fixed Base Services Charge, baseline-related pricing, time-of-use rates, public-purpose surcharges and taxes. LADWP and other municipal utilities use different structures.
What is the Base Services Charge on a PG&E, SCE or SDG&E bill?
It’s a fixed monthly fee on the large investor-owned utilities — about $24.15 for standard residential customers, and roughly $12 (FERA) or $6 (CARE) for income-qualified households — introduced under AB 205 to cover the cost of keeping your home connected to the grid. LADWP and municipal utilities use different structures. Because it’s fixed, it doesn’t drop when you use less electricity or add solar. Confirm the current amount on your bill.
What is the baseline allowance?
The baseline allowance is a first block of electricity billed at the lowest rate, meant to cover basic household needs. It’s set by your climate zone and differs between summer and winter. Usage beyond baseline is billed at higher tiers or time-of-use rates. It’s why the same kWh can cost different amounts on the same bill.
What's the difference between generation and delivery charges?
Generation (supply) is the cost of producing the electricity you used; delivery (transmission & distribution) is the cost of moving it to your home and maintaining the grid. If you have a Community Choice Aggregator, generation comes from them while your utility handles delivery, metering and billing — so you’ll see both entities on one bill.
How do I find my real cost per kWh?
There are two figures. Your all-in average is total bill ÷ total kWh — simple, but it blends fixed charges and taxes, so it runs higher than the price of one more kWh. Your marginal rate is the per-kWh price for the relevant time-of-use period on your plan, shown in the rate section. Use the marginal rate to value solar or a battery; use the average to understand a given bill.
Related reading
Sources & methodology
Figures on this page come from the primary sources below and, where noted, from Cali Energy calculations using the stated assumptions. Rates, incentives, and program terms change; each was verified August 3, 2026.
About this guide
An educational reference from Cali Energy's research team. Charge names, the Base Services Charge and program terms follow current CPUC guidance and can change — always confirm amounts against your own bill and the CPUC site.
Prepared by Cali Energy, August 3, 2026. This article is for general educational purposes only and is not legal, tax, financial, engineering, or utility advice. Rates, incentives, codes, permit requirements, equipment specifications, prices, and program terms may change; figures and timelines are estimates, not guarantees. Confirm current requirements with the applicable utility, AHJ, program administrator, manufacturer, or a licensed professional. See our Content Disclaimer. Cali Energy · 19201 Parthenia St Unit E, Northridge, CA 91324 · CSLB #1032379 (B, C-10, C-39)