The California Public Utilities Commission has revised the fee that Community Choice Aggregation (CCA) and Direct Access customers pay to ensure that customers who remain with an investor-owned utility are: (1) 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 (2) that departing customers do not take on costs that were not incurred on their behalf. The fee that was revised is called the Power Charge Indifference Adjustment (PCIA). The fee is comprised of financial obligations the utilities made on behalf of customers to build power plants and, more commonly, enter into long-term power purchase contracts with independent power producers.
According to the commission, PICA-related bill impacts will vary depending on customer class, service provider, energy usage, the energy markets, and a utility’s resources. Any rate increases for one group of customers will be offset by rate decreases for other sets of customers. In deciding to update the charge, the commission noted that communities throughout California are evaluating and launching CCA programs at a growing rate, and as a result the utilities are experiencing a widening disparity between the level of resources in their portfolios and what is required to serve the reduced load after customers depart of CCA service. It also found that this customer movement has also led to corresponding changes in California’s electric procurement market as CCAs expand their portfolios, compounding the challenges of ensuring that customer departure from utility service is facilitated consistently with the statutory framework supporting CCA formation. Re Review, Revise, and Consider Alternatives to the Power Charge Indifference Adjustment, R.17-06-026, Decision 18-10-019, Oct. 11, 2018 (Cal.P.U.C.).