In October, the Lassen Municipal Utility District (LMUD) Board of Directors voted to adopt a 3-year rate adjustment plan. The goal of the plan is to adjust rates so customers can anticipate small increases over time. The first step in this plan is to separate the public benefits charge from the kilowatt-hour charge.
Beginning with your February bill, you will see a new line labeled public benefits charge. This charge represents 2.85% of your kilowatt-hour charge. The public benefits charge is a non-bypassable charge established by the state of California in 1998 under Assembly Bill 1890.
Before 2026, LMUD absorbed this charge into the kWh rate. As part of the 3-year rate plan, the LMUD Board of Directors voted to break out this charge and show it as a separate item on your bill.
The charge amount varies based on the number of kWhs a customer uses in a billing period. The more energy you use, the more you will pay into the public benefits fund.
You may be wondering how we account for this money and how it is used. We’ve collected public benefits funds for nearly 30 years. Each month, our finance department calculates the number of kWhs sold to customers and deducts 2.85% of our total energy sales. That money is set aside in a restricted fund and spent in accordance with the legislation that created and governs the fund.
All funds collected through the program support local initiatives, education, and community outreach. Examples include our Winter Energy Assistance Rate program, emergency energy assistance, and energy-efficiency rebate programs, such as Energy Star, SmartLight commercial lighting, and energy-efficient heating and cooling rebates. In addition to rate assistance and rebates, the money is used to fund community outreach programs, such as our high-voltage safety demonstration, sponsor local youth programs and scholarships, and public education.
A Deeper Dive into the Public Benefits Charge...
What Is the Public Benefits Charge?
The Public Benefits Charge is a state-mandated fee created under California Assembly Bill 1890 (1996). It represents 2.85% of your kilowatt-hour (kWh) usage and is a non-bypassable charge, meaning all customers contribute based on their energy consumption.
Why Was It Established?
In the mid-1990s, California deregulated its electricity market. Lawmakers were concerned that competitive pressures could reduce funding for programs that benefit the public. To prevent this, the Public Benefits Charge was introduced to ensure continued support for:
- Energy efficiency programs
- Renewable energy development
- Low-income assistance
- Research and technology innovation
This charge ensures these programs remain funded regardless of market conditions.
Why Is It Now Listed Separately?
Until 2026, LMUD included this charge within the kWh rate. As part of our three-year rate adjustment plan, approved by the Lassen MUD Board of Directors, we’ve broken out this charge to provide greater transparency. Beginning with your February bill, you’ll see a separate line item labeled Public Benefits Charge.
How Do Other California Utilities Handle This Charge?
| Utility Type | How Funds Are Collected | Oversight | Program Focus |
| LMUD (Publicly Owned) | 2.85% of kWh usage, shown separately | Local Board of Directors | Local assistance, rebates, outreach, safety programs |
| Investor-Owned Utilities (PG\&E, SCE, SDG\&E) | 2.85% volumetric surcharge | CPUC & Energy Commission | Efficiency, renewables, low-income aid, R\&D |
| Other Municipal Utilities (Azusa, Riverside, TID) | Similar 2.85% surcharge | Local governing bodies | Efficiency, renewables, low-income aid, R\&D |
Key Takeaways
- The Public Benefits Charge was created to maintain funding for essential programs during California’s energy deregulation.
- Both investor-owned and publicly owned utilities collect similar charges, but LMUD ensures funds stay local and benefit our community directly.
- Transparency matters—this is why LMUD now lists the charge separately on your bill.
If you have questions regarding the public benefits charge and how it is managed, call Theresa Phillips at (530) 257-6944 or email LMUD.