The California Community Choice Association on Oct. 11 said it was “very disappointed” by a California Public Utilities Commission decision that revises the fee that community choice aggregation and direct access customers pay. The group said that the PUC’s decision would result in a “devastating blow to the flourishing CCA movement” in the state.
The fee that was revised by the CPUC on Oct. 11 is called the Power Charge Indifference Adjustment, or PCIA. The fee is comprised of financial obligations investor-owned utilities made on behalf of customers to build power plants and, more commonly, enter into long-term power purchase contracts with independent power producers.
The CPUC adopted a decision put forth by Commissioner Carla Peterman. The PUC said the decision ensures that customers who remain with an IOU, such as Pacific Gas and Electric Company (PG&E), Southern California Edison, or San Diego Gas & Electric (SDG&E), are not required to pay costs the utility incurred on behalf of customers who left the utility to become customers of a CCA or direct access provider -- and that departing customers do not take on costs that were not incurred on their behalf.
“I support the creation of alternative electric providers to expand customer choice, and our legal obligation is to make sure this happens without increased costs to customers who do not, or cannot, join a CCA,” said Peterman. “Today’s proposal ensures a more level playing field between customers.”
The PUC said that bill impacts will vary depending on customer class, service provider, energy usage, the energy markets, and a utility’s resources.
Evaluating CCA residential customers departing in 2018, there is an estimated 1.68 percent increase in bills of residential CCA customers over 2018 bills as a result of the decision in PG&E’s territory; in Edison’s territory, that figure is 2.50 percent; and in SDG&E’s territory, that number is 5.24 percent. Any rate increases for one group of customers will be offset by rate decreases for other sets of customers, the PUC said.
Group says decision will stifle competition
The California Community Choice Association (CalCCA) “is very disappointed that the Commission approved changes to the PCIA that favor the investor-owned utilities and will stifle competition from locally-run CCAs,” said Beth Vaughan, executive director of CalCCA.
“However, we remain undeterred in our efforts to support a new PCIA that lowers costs for all consumers and fosters a competitive environment that offers communities more energy options. We will consider all avenues going forward,” she said.
Vaughan said the PUC’s action “will result in a sharp increase in PCIA rates for CCA customers. This devastating blow to the flourishing CCA movement in California could deter further market entry by CCAs. At a minimum, the action will impair CCAs’ abilities to accelerate the state’s decarbonization and economic justice policy goals and to better tailor electric service to meet the needs of local communities.”
In September, CalCCA filed comments with the PUC in which it argued for the rejection of Peterman’s proposal. The group previously said that an initial proposed decision by a California PUC Administrative Law Judge after struck a reasonable balance with respect to stranded cost recovery and offered an opening for long-term cost reduction for both CCA and IOU bundled customers.
PUC set requirements on CCAs in February
Earlier this year, the PUC set new requirements designed to ensure that there is not an excess procurement of resources by the incumbent utilities.
The requirements approved February 8 by the California Public Utilities Commission establish filing deadlines for CCA implementation plans so they align with the PUC’s resource adequacy program.
Several public power utilities and entities in California have moved to provide services to CCAs.
Community choice, also called municipal or community aggregation, has been adopted into law in California, Illinois, Massachusetts, New Jersey, New York, Ohio, and Rhode Island.