| Independently Powered Energy News

Community choice aggregators in Pacific Gas & Electric territory struggle with whether to accept nuclear energy from the utility’s Diablo power plant . This year is the first time PG&E has offered community choice entities a share of the nuke’s output, although they’ve paid for it every year since they were formed.

Local clean energy advocates oppose East Bay Clean Energy and other aggregators accepting the energy. For the former, taking a portion of the power from this troubled nuclear power plant is somewhat akin to an organic restaurant that touts itself as using locally-sourced produce and grass-fed beef turning around and serving its customers beef imported from a huge, polluting factory farm.

To date, two community energy entities have rejected the offer and one has accepted it.

The crux of the controversy over whether to take a share of the nuclear output is rooted in the convoluted Power Charge Indifference Adjustment. As with all controversial California Public Utilities Commission decisions, at issue is who pays, how much and how the tab is calculated.

Below is Current’s PCIA for Dummies. It provides a basic understanding— sans multiple intricacies—for non PCIA nerds.

This ridiculously named fee represents the costs of energy and capacity PG&E acquired on behalf of its ratepayers, including those customers who left PG&E and joined community choice—whether in Marin, San Francisco or the East Bay.

The PCIA has many moving parts.

Currently pending, for example, are a decision on this year's PCIA tab, a proposed PG&E advice letter seeking CPUC approval to allocate this year to community energy its nuclear and big hydro in its territory, and a decision on allocating to community aggregators this same greenhouse gas-free energy next year to 2025, when Diablo is required to shut down.

Starting with the basics: who all picks up the tab for this PCIA?

This year it's investor-owned utility customers, i.e. “bundled customers,” and “unbundled customers.” These unbundled customers are community choice aggregators. Community energy customers see the separate PCIA charge in their bill. PG&E customers do not.

What charge or costs are included in the PCIA? It is the above-market cost or so-called “indifference” amount. That is principally the cost of utility-owned generation—from hydropower to renewable contracts—minus the income the utility reaps from selling power into the market.

How is the cost allocated to CCAs?

It is generally based on two things, including how much of the former PG&E load the aggregator represents. In the East Bay’s case, it is 10 percent. The cost is further adjusted by the year the community energy customers left PG&E. For Marin Clean Energy, for example, it’s 2010 for its first round of customers. They, therefore, generally aren’t on the hook for new power resources PG&E bought or built after that year.

Also included in the above market costs are energy and capacity that does not have a clear price tag because it’s not routinely traded in the market. That includes Diablo energy, part of which is used to serve PG&E ratepayers. That power is thus given an imputed market value, via a benchmark set by the CPUC.

A sore point is the lack of a greenhouse gas free premium attached to the nuclear power. As a result, according to Marin and others, costs are shifted from PG&E to CCA customers because the latter are paying for a portion of the carbon free attributes of Diablo that PG&E claims for its own customers.

That disparity also is why PG&E is offering to allocate part of its nuke power to community choice.

Another point of contention is the amount of retained assets that PG&E counts in its portfolio, particularly renewables and resource adequacy resources. (The why is not being addressed here). Community energy advocates contend that some of those assets are not credited in the PCIA tab, unfairly raising the amount they owe.

At next week's California Public Utilities Commission business meeting, the pending decision on the 2020 PCIA costs is expected to come up for a vote.

Perhaps not surprising is that it is not called a PCIA ruling. In fact, that acronym isn’t even in the name of the proceeding. Instead, it’s wrapped up in what's known as the utility’s Energy Resource and Recovery Account, and its 2020 charges and revenue forecasts.

The decision surely will be controversial, but hopefully a bit less confusing.

— Elizabeth McCarthy

Over 11K Stories!

| Independently Powered Energy News

JUICE: PCIA for Dummies

Elizabeth McCarthy

Related Posts

Using Free Casino Video Slots To Enhance Your Odds Of Winning

A Guide to Finding the Most reputable UK Online Casinos

CPUC Pitches PG&E Reorganization Framework