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October 12, 2018
NEM Events

NEM’s Western Energy Policy Roundtable will be held January 28-30, 2019, at Caesars Palace in Las Vegas, Nevada. You may register here.

An agenda will be available shortly. Sponsorships are available. Please contact headquarters if you are interested in sponsorship.

Click here to view all past updates.
Customer Choice Project Draft Action Plan and Hearing

The Commission announced that it will release a gap analysis and draft Choice Action Plan in the Customer Choice Project on October 19, 2018. The Customer Choice Project is examining issues and developing a report evaluating choice in California's current market in view of increased consumer demand for solar, direct access and CCA participation. A Choice Paper was released in August 2018 that identified issues but did not make recommendations for future action. The Choice Action Plan is intended to help decision makers with a comprehensive plan. It will include:
•gap analysis to examine the fundamental questions raised in the Choice Paper to identify critical issues requiring a solution;
•map of current Commission (and other agency) proceedings that address issues presented;
•identification of outstanding matters that require further analysis; and
•solicitation for public input for solutions that will lead to specific outcomes.

The Commission has also scheduled an en banc hearing on the draft Choice Action Plan on October 29, 2018, beginning at 10AM. The hearing will include a staff presentation of the Plan, followed by responses from the ad hoc advisory committee, LSEs, consumers and environmental interests. Further details about the Customer Choice Project are available at this link.

Order on Calculation of the PCIA

The Commission adopted revisions to the calculation of the Power Charge Indifference Adjustment (PCIA). The PCIA is intended to prevent cost-shifting between bundled and departed customers for costs incurred by the utility for long term contracts and generation. Because of high interest and expected continued growth in consumer participation in CCAs, stakeholders questioned the calculation methodology of the PCIA and urged its revision.

In the decision adopted by the Commission at its agenda meeting yesterday, the Commission decided to:
1) revise inputs to the market price benchmark (MPB) that is used to calculate the PCIA through changes to the Resource Adequacy (RA) and Renewable Portfolio Standard (RPS) adders;
2) adopted an annual true-up mechanism; and
3) adopted a cap that will limit the change of the PCIA rate from one year to the next to provide departing customers with increased rate stability and certainty; and
4) permit an option for departing customers to pre-pay their PCIA obligation.

The Commission adopted new transaction reporting requirements applicable to all Load Serving Entities, including Community Choice Aggregators and Energy Service Providers, attendant with the adopted change to the RPS adder calculation. Beginning in 2019, all LSEs shall submit the following information to the Commission’s Energy Division on an annual basis by January 31:
"*Contract information shall be collected for all Load Serving Entity contracts executed in year n-2, with year n being the forecast year for which the Power Charge Indifference Adjustment calculation is being done.
*Contract information shall include: seller name, execution date, contract price ($/MWh), term length of contract, capacity (MW), associated Net Quantifying Capacity, annual expected generation (MWh/year), expected generation for year n.
*If a contract includes Time of Delivery (TOD) adjustments, then the contract’s price shall be TOD-adjusted."

The revised methodology will be used to calculate the PCIA that is effective as of January 1, 2019. A second phase of the proceeding will be opened to consider the issue of excess resources in utility portfolios and a corresponding solution. The Commission said the solution should be based on a voluntary, market-based redistribution of excess resources in the electric supply portfolios of the utilities.

The full text of the Decision is available on the NEM Website.

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