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San Francisco-based Pacific Gas and Electric Co. in 2001 began experimenting with card acceptance, and since January 2007 it has accepted Visa credit and check cards for free as part of an 18-month pilot.
The pilot ends this month. Though Visa has maintained its 75-cent interchange rate for utilities that do not charge convenience fees for card transactions, at Cards&Payments' deadline the utility had yet to decide whether to continue fee-free card acceptance, according to a utility spokesperson. He declined to comment further.
The utility participated in the pilot because it was eager to promote electronic-payment options and to encourage customers to opt out of accepting paper bills, which cost the utility about 45 cents each to create and distribute.
California law does not allow utilities to raise rates to all customers to cover the costs of serving one particular segment of customers, in this case cardholders.
In 2001, Pacific Gas and Electric began accepting only Visa check cards, and cardholders paid $1.50 per transaction. Bill Matrix, a third-party online payment vendor owned by Brookfield, Wis.-based Fiserv Inc., collected and processed the payments. The utility raised the fee to $6 per transaction before ending the program in 2003. CP
