The day before the CPUC decision on PCIA, there was a groundbreaking for a 10.5 megawatt solar project in Richmond sponsored by the City of Richmond and MCE. Now Richmond ratepayers will have to pay more for electricity generated locally.

Since the Proposed Decision was issued on November 13th, there has been an astonishing outpouring of engagement and concern on this significant rate hike. Community members have “deluged” CPUC Commissioner Mike Florio, the assigned Commissioner to this case, with what he called “an unmanageable influx of emails.”

A number of our own MCE member communities have written the CPUC and also passed Resolutions opposing the proposed increase to the PCIA exit fee. There has also been robust support in the legislature from representatives of MCE service territory as well as Assembly Speaker Pro Tempore Mullin. Our CCA partners throughout the state held numerous meetings with Commissioners. The need to scrutinize the PCIA exit fee was not only urged by the editorial board of the San Francisco Chronicle, but an article about the issue was put on the front page. Most significantly, the CPUC has heard from hundreds of ratepayers and CCA advocates insisting that the CPUC ends business as usual and takes a deep look into the PCIA.

There was a remarkable turnout of speakers and community supporters at the press conference organized by LEAN. More than forty five passionate speakers came to speak directly to the CPUC to oppose the increase in PCIA. 



Shawn Marshall of LEAN Energy and Tom Butt of MCE at press conference at CPUC on December 17 to rally against the PCIA



Commissioner Sandoval proposed two amendments that would have mitigated the PCIA rate hike; those proposed amendments were rejected by the other four Commissioners.

Apparently, the CPUC is suffering a disconnect from Governor Brown’s goal to provide 50% of California’s electricity from renewable resources by 2030. Governor Brown, who appoints members of the CPUC, was recently in Paris at the UN Conference on Climate Change touting California’s leadership in reducing greenhouse gases, but back home his appointees are busy manufacturing roadblocks.



Governor Jerry Brown in Paris signing an MOU with governors from Vermont and Washington

The CPUC, already suffering from a reputation of being too cozy with the investor owned utilities, like PG&E, proved that they want to keep that reputation intact.

Community Choice Aggregation (CCA), provided by a growing number of local government agencies in California, is an opportunity for individual consumers to make a choice for renewable energy, but in order to have the best chance of working, the cost should be at least competitive with the cost of energy with a lesser renewable component from investor owned utilities.

Currently, green energy is actually cheaper than energy produced from fossil fuels, but the CPUC is making sure that will change by adding the PCIA surcharge.

One of the problems with California energy policy is that it lacks a unified management and regulatory scheme. Everything is in silos, and they are not necessarily connected. Perhaps the CPUC is the most disconnected of all.

The unfortunate CPUC decision on PCIA happened one day after the CPUC released a draft climate change policy, stating it will develop policies that support the state’s ambitious climate and energy goals. Commissioners and their staff are not currently required to factor greenhouse gas emissions impacts into energy policy decisions affecting California’s electricity sector, like they do with reliability, safety, and affordability. While this is a step forward, it does not specify what kind of policies the Commission plans to use to support the state’s pollution reduction goals.

Ironically, the primary argument by the CPUC and PG&E for PCIA is to avoid unfairly saddling bundled (read non-CCA) ratepayers with costs of benefits enjoyed only by CCAs. However, PG&E has no problem saddling all its ratepayers with subsidizing the cost of energy for PG&E employees, who are entitled to a 25% discount on their energy bill--a fact that seems relatively unknown by most members of the rate-paying public.

Here is what PG&E says about it: http://spd.mypgebenefits.com/mat/pge-9a0-work-life-eds-mgmt-web-j.html. We bring this up for a couple reasons:

• Fairness -- It seems problematic for PG&E to extract millions of dollars in PCIA fees (even from low-income customers) while it simultaneously gives a 25% discount to its employees without any adjustment socio-economic status.

• Why should PG&E executives receive a discount on their energy (presumably subsidized by ratepayers) while they're proposing to raise PCIA fees by 95% on CARE customers, local non-profits, public school districts, houses of worship, military veterans, et. al.?

• Energy Efficiency & GHG reduction -- A discount to thousands of well-paid consumers creates an obvious disincentive to conserve;

• Rate competitiveness -- A selective discount of this size & scope presents a burden to bundled customers, and contradicts PG&E's assertions that affordability and rate competitiveness is a priority. 

• Also, this discount helps explain how MCE and other CCAs can offer competitive rates, while providing substantially higher levels of renewable energy.  In other words, MCE can offer more renewable energy at competitive rates because (among other things) our agency does not use ratepayer dollars to subsidize its employees' energy consumption;

• Ratepayer advocacy -- Very few people know about this discount. We have yet to ask a single person who realized it was baked into their utility costs (other than friends who work for PG&E).

• Why not reduce the discount to 10% (or 5%) for all employees earning above $100,000/yr (or $90,000/yr), and use the revenue savings to provide relief to CCA CARE customers?

Following are a number of articles and editorials about the CPUC decision:

Tom Butt

Customers of clean energy programs hit with fee increase

If the CPUC approves a fee for customers leaving PG&E, programs like CleanPowerSF may have to eat the cost. (s.f. examiner file photo)

By Joe Fitzgerald Rodriguez on December 15, 2015 1:00 am

Our hot world is working to cool down, together.

In Paris, international leaders broke into tears over an agreement to reduce carbon emissions. Did the agreement go far enough to save our environment? Probably not.

Still, some are calling the deal “historic.” And, at least, it’s a step forward.

However, on the eve of those talks, here in famously liberal San Francisco, we may soon “historically” blunder backwards on climate change.

The California Public Utilities Commission is set to approve a set of rate calculations from Pacific Gas & Electric, Co. Buried in dense regulator-ese is a provision to adopt what’s called the “Power Change Indifference Amount.”

In plain English, it’s a provision to jack up the price customers pay to join renewable energy programs sponsored by cities. In San Francisco, that’s CleanPowerSF, which may launch as soon as next year.

This may stunt renewable energy programs in Marin, Sonoma and any city that may soon offer such programs.

If you’re a customer of PG&E, you now pay an “exit fee” to drop PG&E and join a community choice aggregation program, in which cities provide renewable energy to their citizens. This decision may send those exit fees through the roof, by nearly 95 percent.

PG&E is no doubt jacking the fees to protect their once-monopoly on California energy.

The consumer will never see this fee, but that’s only because community choice aggregation programs like CleanPowerSF will eat the cost — and the effect it will have on the program itself is damning.

Jason Fried, executive officer of the Local Agency Formation Commission, told On Guard the exit fee may cost CleanPowerSF as much as $8.5 million in the next five years.

“That’s millions that could’ve been spent on the buildout,” he told me.

The money would create jobs building out solar panels, wind turbines and energy of the hippie-dippy planet-saving variety. Whereas CleanPowerSF may have seen its power mix become 50 percent renewable in the coming years, now the program may have to scale back to 33 percent renewable in the near future, Fried said.

That’s still more clean and green than PG&E, but it’ll delay CleanPowerSF’s lofty plans — and every year counts in our rapidly warming world.

The decision is also a test for a regulator that’s shown itself to be a dozing watchdog.

The CPUC’s “love letters” to PG&E are well documented — especially despicable when seen in the light of a PG&E-produced fireball that destroyed a part of San Bruno, killing eight.

Disgraced CPUC President Michael Peevey stepped down, and Michael Picker is now steering the regulator in a new direction. But the president wasn’t the only one blowing kisses PG&E’s way.

Emails revealed in the last month by the city of San Bruno show commissioner Mark Florio, who is still somehow shockingly sitting on the commission, was particularly close to PG&E.

“Amazing how I’ve been ‘an apologist for PG&E’ in just three years, isn’t it,” Florio wrote in a 2011 email, as the San Jose Mercury News revealed.

San Bruno City Manager Connie Jackson told On Guard, “Mr. Florio has demonstrated he is concerned PG&E gets what it wants, whether it’s in the public’s interest or not.”

We asked the CPUC for comment, but received no answers by press time.

Now Picker and the commission are facing an early test of their “new direction” — raising “exit fees” on state renewable energy programs may show if CPUC will kow-tow to PG&E again.

State Sen. Mark Leno, D-San Francisco, tried to reform this shady relationship, only to see his bill vetoed by Gov. Jerry Brown (“moonbeam,” indeed). Leno penned a letter to the CPUC decrying the vote to raise prices on the PG&E exit fees.

Speaking to On Guard, Leno said the CPUC’s job “is to scrutinize the utilities presentations in these rate setting cases, and be there to protect the consumer.”

“We’re just asking them to do the job they’ve been given to do,” he said.

Come Thursday, we’ll see if the CPUC is still a smooching watchdog, or if it has bite.

On Guard prints the news and raises hell each week. Email him at joe@sfexaminer.com.

PG&E’s huge profit from exit fee signals need for reform

Giant wind turbines are powered by strong winds on March 27, 2013 in Palm Springs, California. According to reports, California continues its lead in green technology and has the lowest GHG emissions per capita, in the Nation.

When customers leave PG&E’s electric generation service, they are assessed a permanent, ongoing exit fee. No one disputes that an exit fee paid to utilities, if appropriately administered, can be a fair way to equitably reimburse existing electric customers when others leave for cleaner energy from programs such as Marin Clean Energy, Sonoma Clean Power, or forthcoming programs such as CleanPowerSF or Peninsula Clean Energy.

What is at issue is why the California Public Utilities Commission is not asking questions expected of an oversight body or engaging in a transparent public process in this important decision. We request that the state commission reject the PG&E proposal to double the exit fee when it votes on Thursday until the commissioners can audit PG&E’s proposed rate increase and revisit the fairness of the calculation of the fee, known as the Power Charge Indifference Adjustment.

Until that audit and public discourse has taken place, we propose that the commission temporarily cap any such increases requested by the utility. The commission should then convene a series of public workshops and attempt to create a fair and balanced process that provides equity for customers who choose to remain with PG&E and for those who choose a cleaner future through community choice aggregation programs.

If PG&E’s proposed increase to $13 from $6.70 a month is approved, it would stifle efforts of California cities to receive cleaner electricity and disproportionately charge higher fees to the poorest households. California cities and counties, energy advocates and environmental organizations are demanding that the commission enforce its own rate-making rules by taking the time to properly audit and discuss PG&E’s rate proposal.

A system that has allowed PG&E to stockpile $1 billion in profit off the backs of “exiting” customers is a red flag that the calculation is out of balance and in need of major overhaul. When PG&E takes the exit fee, it still has the ability to sell the power at a profit that the exiting customer would have used. Further, under the current system, PG&E collects the exit fee in perpetuity. The utility has not been required to reimburse those exiting customers their fee when there was no loss. Instead of allowing PG&E to roll the exit fee into its budget, the commission should require the utility to reimburse exiting customers.

The commission cannot simply trust the calculations of PG&E, nor expect the public to do so, when the data behind the calculations is kept secret.

It is clear that the 100 percent increase in the charge is aimed at targeting the clean power programs seeking to expand renewable energy generation. Failure to reject this proposal will signal the commission’s intention to rubber-stamp PG&E’s attempt to limit competition and consumer choice. It will further fuel public worries that the California Public Utilities Commission cannot be trusted to protect consumers from monopoly interests.

Mark Leno represents San Francisco in the state Senate. Francesca Vietor is the president of the San Francisco Public Utilities Commission.

Marin Clean Energy customers to pay PG&E more