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CPUC Decision Eliminates Electric Extension Subsidies for Mixed-Fuel New Construction Projects
Customer Fact Sheet
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The purpose of this document is to help customers understand the California Public Utilities Commission’s (CPUC’s) December 21, 2023, decision to eliminate electric line extension subsidies for mixed-fuel new construction projects.

The What (CPUC’s Phase 3B Building Decarbonization Decision)

  • On December 21, 2023, the California Public Utilities Commission (CPUC) issued a decision to eliminate electric line extension subsidies (allowances/10-year refundable option/discount option) beginning July 1, 2024, for mixed-fuel new construction projects.
  • These are any residential, commercial, industrial, or agricultural Rule 15 Distribution Line Extension and/or Rule 16 Service Extension projects that use natural gas and/or propane in addition to electricity (i.e., mixed-fuel) and where the building project has never been used or occupied for any purpose.
  • As defined in SCE’s Rule 15 tariff, the mixed-fuel new construction definition uses the term “building.” This term includes such things as structures or spaces where an electric service/meter can be mounted (e.g., stand-up electrical panels and pedestals that house the electric meter/service) and for which a building permit is required, as noted in Section 100.0 of the California Energy Commission’s Building Efficiency Standards.

The Why (California’s Clean Energy Future)

  • The CPUC decision advances state goals to reduce greenhouse gas (GHG) emissions associated with energy use in buildings and is part of a larger effort to diminish overall GHG emissions. To learn more, read the CPUC’s press release.

The When (Decision Effective Dates)

  • The changes will take effect on July 1, 2024. Following is a summary of all effective dates, as mandated by the CPUC, including the actions that SCE is tasked with carrying out:

    Before July 1, 2024

    • Applicants must have contracts signed and submitted with a paid invoice prior to July 1, 2024. Otherwise, the project will be repriced without subsidies beginning on that date.
    • SCE will verify that customers have properly identified the required project fuel type within a new section that’s been added to the Customer Project Information Sheet (CPIS) and report this to the CPUC.

    July 1, 2024, subsidies eliminated

    • This applies to both Rule 15 Distribution Line Extensions and Rule 16 Service Extensions for new construction applications, which include mixed-fuel. 
    • Applicants will continue to pay the estimated cost up-front before work commences and will be invoiced after the project is completed as a ‘true-up’ of actual costs. If the final actual costs are higher than the estimated costs, the customer will be invoiced for the difference and reimbursed if the estimated costs are higher than the final actual costs.

The Who (Customer Impacts)

  • Beginning July 1, 2024, mixed-fuel new construction projects will no longer receive allowances or include an option to choose a 10-year refundable option or 50% discount option for Rule 15 Distribution Line Extension and Rule 16 Service Line Extensions.
  • As the CPUC decision implements actual cost billing and eliminates subsidies for such projects, the estimated value of structures installed by the applicant and deeded to SCE will no longer be applicable for refunds. However, the Income Tax Component of Contribution (ITCC) will still apply.
  • Applicants will receive an initial estimated cost invoice for their project, with a 15% contingency added at the beginning of the project. After project completion, a ‘true-up’ of actual costs will occur.
    • If, after finalizing the ‘true-up‘, actual costs are higher than the estimated costs, the applicant will be billed the difference.
    • If after finalizing the true-up, actual costs are lower than the estimated costs, the applicant will be reimbursed the difference.
  • Applicants must sign both the “yes” and “no” mixed-fuel acknowledgment section of the updated Customer Project Information Sheet (CPIS) to attest whether the project is mixed-fuel or all-electric.

The How (Customer Invoices, Contracts & Scheduling Impacts)

Customer Invoices

  • The following changes already appear on customer invoices:
    • To keep current pricing, invoices must include wording noting the applicable dates for invoice submittal and signed contracts.
    • Starting July 1, 2024, in-flight projects with unpaid invoices and signed contracts will be repriced, removing subsidies and resulting in an increase to the previously billed invoice.
    • Starting July 1, 2024, new mixed-fuel projects’ allowances will not be applied, nor will refundable or discount options be available.

Customer Contracts

  • Starting July 1, 2024, in-flight projects with unsigned contracts:
    • Rule 15 contracts will be revised to reflect mixed-fuel requirements for projects, and the applicant will remain responsible for signing and submitting them to SCE.
    • Preliminary Calculations (Pcals) will no longer be provided for new Rule 15 mixed-fuel projects.
  • Allowances and Series Refunds:
    • Contracts signed and submitted with a paid invoice prior to July 1, 2024, will remain eligible for excess allowance/series refunds so long as the project is completed before July 1, 2025. If the project is not energized by July 1, 2025, the CPUC has ordered SCE to reprice the work order without subsidies and as actual cost billing. 
    • After July 1, 2024, where there is an open refundable contract, SCE will continue to apply its Rule 15 series refund tariff language, regardless of the project type, specifically mixed-fuel.


If you have questions about this CPUC decision, please contact your local SCE service center and ask for the Planning Department.

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