LADWP rates surge 45% as board orders review of billing structure

Los Angeles Department of Water and Power customers face a sharp rise in costs, with rates jumping 45% over the last year. The Los Angeles Board of Commissioners passed a resolution on Tuesday night to review the agency’s rates, structures, and application to individual accounts. The move comes after years of deferred maintenance and new capital investments pushed bills beyond inflationary trends.

Tim O'Connor, executive director of the LA Office of Public Accountability, described the resolution as a step in the right direction. He noted that current rate structures were designed more than a decade ago. O'Connor said the review must modernize billing to reward customers for shifting usage and encourage new technology.

Critics also pointed to executive compensation during the review. Investigations found nine LADWP executives earn over $700,000 annually, while more than two dozen supervisors make over $600,000. LADWP stated that total labor costs represent 18% of its $10.8 billion budget. O'Connor argued that salaries are not the primary driver of high bills, but acknowledged the need to ensure compensation remains reasonable.

LADWP overtime expenses rose 17% from 2024 to 2025. The increase moved from roughly $426 million to more than $499 million. The agency attributed the rise to the need to retain skilled workers for its electric infrastructure. It maintains that its rates remain lower than those of Southern California Edison and Glendale Water and Power.

Denise Grab, project director at the UCLA Emmett Institute, said the recent hikes caused sticker shock for residents. She explained that LADWP is catching up on maintenance after years of lower-than-average rates. A 2026 study by New Gen Strategies confirmed that LADWP rates are currently lower than those in Pasadena, Burbank, and Glendale. LADWP is installing new smart meters over the next year to provide real-time data on usage.

The agency expects rates to more than double in the coming years due to aging infrastructure and rising demand. O'Connor called for a reevaluation of solar energy pricing and low-income assistance thresholds. He stated that current federal poverty indexes do not reflect the high cost of living in Los Angeles.