September 21, 2018
By: Julian Cañete
California is a national leader in clean energy. Contrary to the perspective of advocates for Community Choice Aggregators (CCAs), the question before the California Public Utilities Commission (CPUC) on Sept. 27 is not whether our state will continue to lead the nation in renewable energy, but whether all customers will contribute equitably to the costs of those investments and to systemwide electric reliability. (Fair Exit Fee Critical to Renewable Energy Future, Capitol Weekly, Sept. 6)
When the Legislature authorized local governments to begin buying power for electricity customers through CCAs, it made it clear that one customer’s decision to exercise energy choice “shall not” result in increased costs for another. The very purpose of the CPUC regulation, called the Power Charge Indifference Adjustment (PCIA), is to ensure customer indifference.
However, that is not how the system is working.
Already millions of electricity customers who buy power from IOUs are picking up more of the tab for past investments that benefit us all.
As a result, millions of electricity customers who buy power from investor-owned utilities (IOUs) are paying more than they should for investments in clean energy and system reliability while customers served by CCAs and other alternative energy providers are not paying their equitable share. The CPUC opened a proceeding more than a year ago to secure input and consider changes.
Advocates for CCAs seem to believe the purpose of the PCIA is to “foster” (the growth of) CCAs by limiting their exposure to a PCIA charge. However, if the continued growth of CCAs is dependent upon sheltering their customers from the reality of costs and shifting those cost burdens to power customers of IOUs, that is simply not sustainable.
It also raises questions about how we fund our state’s future commitment to clean energy and system reliability. It should also be noted that when the CPUC made a minimal increase to the PCIA several years ago, CCA advocates claimed it would have devastating impacts, slowing CCA growth and adoption. That has not happened, as more communities have formed CCAs.
Already millions of electricity customers who buy power from IOUs are picking up more of the tab for past investments that benefit us all. These customers include seniors on fixed incomes and other families struggling to make ends meet.
There are two pending policy proposals before the CPUC on Sept. 27 to reform the PCIA.
The first released by an administrative law judge fails to fix the cost-shift problem and makes it worse for power supply customers of IOUs.
The Alternate Decision presented by Commissioner Peterman comes far closer to eliminating cost-shifts and ensuring that all customers contribute equitably to clean energy and system reliability — regardless of who provides their power.
As more and more customers are served by CCAs in the coming years, fewer and fewer IOU customers will bear an increasingly disproportionate cost burden for costs associated with past investments in clean energy and system reliability. This is not what the legislature intended when it authorized the creation of CCAs.
More than forty organizations from Equitable Energy Choice for Californians (EECC) representing seniors, veterans, small business, labor and community groups support the Alternate Decision with modifications to further eliminate all cost-shifts. Our coalition supports more choices in energy providers but not if those choices result in costs being unfairly shifted from some customers to others.It is critical the CPUC gets this right.
Julian Cañete is president and CEO of the California Hispanic Chambers of Commerce.