Currents

An Energy Newsletter for Local Governments

Community Choice Aggregation

Utility Tariffs

On February 28, 2008, the CPUC issued a final decision (D.08-02-013) that addresses several issues between CCAs and the investor owned utilities.

• The decision directs the IOUs to remove any clause in their tariffs requiring CCAs to have their customer notices reviewed and approved by the CPUC Public Advisor. The CPUC finds that there is no need to oversee CCAs in this regard, but that the CPUC should oversee the IOUs’ communications with customers in a CCA’s territory to ensure that the IOU’s are not adversely affecting the CCAs.
• The decision directs the utilities to modify their tariffs to allow a CCA that submits a binding notice of intent to serve customers on a certain date, which is part of the ‘Open Season’ planning process for the utilities, to update that service start date in a subsequent open season that happens before the CCA starts service if the new start date is not more than three months before or after the original date. Updates that commence later than originally planned must be made in an open season at least a full year in advance of the original service date.
• The decision modifies an earlier decision (D.05-12-041) to eliminate the reference to the need for a CCA to provide evidence of insurance, self-insurance, or a bond to cover the cost of utility forecasting errors (the LGSEC submitted comments in support of this).

Bond, Insurance, Self-Insurance

In the original CCA Rulemaking (R.03-10-003), the CPUC did not set an amount for a bond, or a methodology for calculating a bond that could be applied to CCAs. The approval process for the San Joaquin Valley Power Authority (SJVPA), the first CCA to file an implementation plan, has highlighted the need for policy direction on bond requirements for CCAs.

PG&E and SCE favor a bond calculation methodology that would result in a requirement for a bond in excess of $140 million. SJVPA favors a bond requirement equivalent to the security deposit requirement that currently applies to an energy service provider's registration with the CPUC, currently between $25,000 and $100,000, depending on how many customer accounts are served by the energy service provider.

In December, the CPUC issued Resolution E-4133 on December 20, 2007. It found that an interim bond of $100,000 was sufficient for SJVPA to post with the CPUC as part of its CCA registration packet. PG&E filed an application for rehearing of this Resolution in January. The CPUC denied the application in March. The CPUC will separately address CCA program implementation and the bond requirements for CCAs through a new or existing proceeding. PG&E continues to push for hearings on the issues of creditworthiness and liability for CCA programs.

Net Metering

On February 15, 2008, the CPUC issued a decision (D.08-02-002) in the distributed generation proceeding, Rulemaking R.06-03-004, regarding net metering for CCA customers. The PD directed the utilities to offer CCA customers the same service they offer their own customers (PG&E and SDG&E proposed giving CCA customers no credit for their power).

The decision directs the electric utilities to modify their tariffs to provide Net Energy Metering services to CCA customer-generators (CCA customers that install their own distributed generation). It directed the electric utilities to allow CCA customer-generators with solar generators up to 1 megawatt (MW) and wind generators up to 50 kilowatts (kW) to receive generation credits from the CCA, and transmission and distribution credits from the serving utility. Biogas and fuel cell generators up to 1 MW and wind generators with a capacity of more than 50 kW up to 1 MW will receive a generation credit only, from the CCA.

SJVPA Issues and Complaints

The San Joaquin Valley Power Authority (SJVPA) has filed several complaints with the CPUC about the IOUs in regard to its intention to become California’s first CCA program. The activities of the IOUs have delayed the start of SJVPA’s program from November 2007 to a now unspecified date.

The complaints revolve around PG&E marketing, which SJVPA says has been in violation of CPUC decision D.05-12-041, Southern California Edison’s rate design application, which SJVPA says is an attempt to shift generation-related costs to delivery-related costs thus making it harder for CCAs to compete with its generation rates, and on the issue of joint and several liability of CCA members, which the IOUs have written into their CCA tariffs but which is specifically excluded in SJVPA’s JPA agreement.

There has been no resolution to these SJVPA issues as of March 31, 2008. Hearings are scheduled before the CPUC the second week of April. For more detail on each of these complaints, see LGSEC Update #1, January 2008.

| Back | Back to Beginning |