Three major utility companies in California are looking to restructure customer billing, and part of that means customers could be charged based on how much money they make.

Source: California utility companies propose charging customers based on how much money they make – ABC7 Los Angeles

Since income for many can be variable, consumers may not know their annual income until preparing the prior year’s tax returns. For example, ACA insurance policies are now based on income (80% are said to be eligible for sliding subsidies). Consumers estimate their income when buying a policy, and then the next year update that with corrected income. If they underestimated, consumers must pay the government a correction, or if they underestimated, the government may issue a refund.

To make this work, consumers would need to file an annual “income” return with their utility company creating a host of privacy issues. They propose creation of a new government agency to track household income (everyone who lives in the household.)

Finally, should everything be charged based on income?

  • Groceries?
  • Gasoline? Automobiles? Parking fees?
  • Airfare? Bus and train fares?
  • Products purchased at Lowe’s or Home Depot?
  • Access to health care?
  • Is this an extension of offering Senior discounts, child discounts, but basing it on income?
  • This pricing discrimination strategy above, is based on utilities being monopoly providers and most consumers would not have affordable alternatives (installing solar PV and battery banks is not an option for many).