Pacific Gas and Electric, the electricity supplier for much of the Bay Area, has said that rates will drop in 2026.
If you feel a bit skeptical reading that, we get you! And as you’ll see below, you’re not wrong.
Both gas and electric rates have risen steeply for years now. And when it comes to the “decrease” in 2026, the details matter.
What PG&E is actually promising for 2026
On its General Rate Case information page, PG&E says that it does not expect any more electric rate hikes in 2025 and is projecting that both residential electric rates and average combined bills will be lower in 2026.
Cost recovery measures for things like wildfires were included in bills before, and those are being phased out or have finished.
So, how much less will electricity cost?
A separate PG&E filing on the extended operation of the Diablo Canyon nuclear plant offers a concrete example: for a typical residential customer using 500 kilowatt-hours (kWh) per month, the company forecasts that the total electric bill would fall from about 215 dollars to 214 dollars in 2026.
For those keeping score at home, that’s about .5% decrease.
So when PG&E says that rates are going down, that’s technically true. But don’t expect big drops. The example given is literally a $1 per month drop. Not exactly something to write home about.
Of course, that’s the average. Some customers may see bigger drops.
How we got here: Years of steep bill increases
Not super excited about this “drop”? PG&E would probably encourage you to consider the alternatives.
PG&E customers saw some of the steepest bill increases in the state in 2023 and 2024 as the company poured money into wildfire safety projects, grid upgrades, and other mandated work.
One recent analysis found that the typical PG&E household paid roughly 400 dollars more in 2024 than in 2023.
The end result? Families in the Bay Area are still paying for more for electricity than they did even a few years ago. And while rates are stabilizing, that pain won’t got away for a while yet.
