The difference between Tier 1 and Tier 2 energy in LADWP is the cost per kWh for electricity. For example, in summer 2023, the cost of Tier 1 electricity was 20.78 cents per kWh while the cost of Tier 2 electricity is 26.64 cents per kWh.
The tiers are based on household electricity consumption and temperature zones. For example, if you live in Zone 1, your first 700 kWh per bi-monthly billing cycle is charged at Tier 1 rates and your next 1,400 kWh are charged at Tier 2 rates.
If you surpass your Tier 1 and Tier 2 allotments (2,100 kWh for Zone 1) you are then charged Tier 3 rates, which were over 35 cents per kWh in summer 2023.