LADWP rate hikes are facing a formal review after Los Angeles utility customers reported sharp increases, in some cases amounting to thousands of dollars. The city’s Department of Water and Power board has requested an examination of its rates, pricing structures and how charges are applied to individual customers.
Tim O’Connor, executive director of Los Angeles’s Office of Public Accountability, described the move as “a great step in the right direction”, but said the detail of the review would be crucial.
He said the process should make bills easier to understand and consider a modern rate structure that reflects when electricity is used, supports new technology and gives customers better information about their consumption.
The review is also expected to examine the pay of senior LADWP staff. Nine executives earn more than $700,000 a year, while more than two dozen supervisors receive more than $600,000, according to an investigation cited in the material.
Mr O’Connor said salaries were not the main reason customers were feeling the impact of higher bills. He said the largest cost pressures came from capital projects, operations and maintenance, while acknowledging that pay levels should still be assessed for reasonableness.
LADWP said overtime represented 5% of its $10.8 billion budget, with total labour costs accounting for 18%. Overtime payments rose from about $426 million in 2024 to more than $499 million in 2025, an increase of 17%.
The utility said the employees in question held highly skilled roles needed to operate, maintain and restore Los Angeles’s electricity infrastructure. It said competition across the sector made recruitment and retention difficult.
LADWP rate hikes outpace inflation
An analysis by the UCLA School of Law’s Emmett Institute on Climate Change and the Environment found that LADWP rates had risen by 45% over the previous year, compared with a 4% increase for Southern California Edison.
Denise Grab, director of the Emmett Clean Energy Law and Leadership Project, said the increase was “significantly in excess of inflation”. She attributed part of the rise to major capital projects and said the utility was catching up after years when rates had been comparatively low and some maintenance had been deferred.
Mr O’Connor said his office had also found that the cost of water and power had exceeded inflation over the previous 18 months. He said LADWP bills remained lower than those from some other utilities, but argued that affordability still required reform.
Research published in 2025 by Ms Grab’s organisation found that LADWP rates were lower than those charged by Glendale Water and Power and Southern California Edison. A 2026 study commissioned by Pasadena also found Glendale and Edison rates were higher than those of LADWP, Burbank Water and Power, and Pasadena Water and Power.
Both Mr O’Connor and Ms Grab warned that prices were likely to continue rising. They pointed to ageing infrastructure, wildfire liability and prevention, and increased air-conditioning use during heatwaves as factors that could drive future increases. An LADWP presentation indicated that rates could eventually more than double from current levels.
Ms Grab said the utility needed to improve communication with customers, including explaining how bills were calculated, when electricity was most expensive and how households could reduce their use.
LADWP is introducing smart meters over the next year, which are intended to give customers more immediate information about their consumption. Mr O’Connor also called for changes to time-of-use pricing, solar energy rates and assistance schemes for low-income households.
He said eligibility for support should take account of Los Angeles’s higher cost of living, rather than relying solely on a measure based on national poverty statistics.
