CPUC Okays New SDG&E Peak Period

24 Aug 2017

State energy regulators unanimously approved the second phase of San Diego Gas & Electric’s 2016-19 general rate case, which includes a shift in the time-of-use peak period and off peak rates. The redesign is part of SDG&E’s allocation of its approved triennial revenue requirement.

“Time-of-use rates acknowledge we have an eclipse every day,” Mike Picker, California Public Utilities Commission president, said Aug. 24.

The rate decision is the first one to okay “time-of-use pricing that reflects system costs,” including those driven by climatic conditions, according to Picker. Peak rates are to discourage customers from using energy at times of high daily demand and encourage onsite generation, he added.

The new summer peak period is from 4 p.m.-9 p.m. on weekdays, which is said to reflect the shifted peak from the rise in rooftop solar systems. It replaces the 11 a.m.-6 p.m. summer peak period in place since 1980.

Commissioner Cliff Rechtschaffen warned that the shifted summer peak rate will cause a savings loss for some customers.

California solar advocates complained that the Aug. 24 decision was harmful to solar customers, inconsistent with state policies, and not supported by the facts.

“It is shocking that the commission purposefully avoided considering data that was solidly in the record,” said Brad Heavner, California Solar Energy Industry Association, policy director.

The solar advocates pushed for a peak from 2 p.m.-7 p.m.

An earlier peak would “help reduce consumption during hours of declining solar generation when the California system operator needs to ramp up gas plants to meet energy needs,” said Brandon Smithwood, the Solar Energy Industry Association’s director of California affairs.

The new rates also include a super spring off peak one to reflect low demand and high hydro power.

The decision also extends favorable rates to the small percentage of schools in San Diego that install rooftop solar systems and delays higher charges for small commercial electric vehicle fleets.

The changed fluctuating rates take effect Dec. 1.

Although she voted for the decision, commissioner Martha Guzman Aceves said she struggled with time-of-use rates. “Some customers don’t have the luxury of shifting demand.” She also raised concerns about inconsistencies in providing rate discounts, noting they are provided to ports and electric vehicle fleets and a few schools.

The San Diego School District challenged SDG&E’s proposal. It said it would unfairly disadvantage those schools that want to install solar rooftops, but confront construction limitations.

The decision extends favorable time-of-use rates to schools that install rooftop solar by Aug, 31, 2018. However, it denies providing schools a discounted energy rate.

The decision claims the annual revenue shortfall from a proposed 12.5 percent schools discount would be $10 million, with the annual revenue shortfall from the fixed indifference amount being $1.6 million.

A discounted rate for schools, however, is to be addressed in subsequent general rate cases because of lower rates offered to commercial and industry customers.

The decision extends the favorable small commercial rate for three years to companies with electric vehicle fleets.

Elizabeth McCarthy

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