In a stunning victory for IBEW 1245 members and the customers that they serve, the California Public Utilities Commission has unanimously approved an alternative proposed decision on modifying the Power Charge Indifference Adjustment (PCIA). This newly adopted methodology will alleviate the unfair cost shifting that has plagued California’s energy marketplace for years.
The PCIA is the fee that Community Choice Aggregation (CCA) customers are required to pay by law, to offset the cost of the power that the utility has already purchased their behalf (since power is generally purchased 10 to 20 years in advance). However, over the years since the formula used to calculate the PCIA was first established, the cost of energy has changed considerably, due in large part to the investments being made in renewables. As a result, the PCIA has become woefully insufficient — about 35% less than what is truly needed to cover the full expense — and the utility customers have been forced to foot the remainder of the bill, essentially paying for power that isn’t theirs.
The newly adopted methodology changes the way that the PCIA is calculated, so it will more closely align with the with the price of power paid by utilities and CCAs. This change will ensure that everybody pays their fair share, and neither utility nor CCA customers will be on the hook to pay for power that they didn’t use.
“IBEW 1245 has been advocating for this type of change in the PCIA methodology for over a year, and the union is exceptionally pleased to see that the CPUC has acted accordingly,” said IBEW 1245 Business Manager Tom Dalzell. “Through this work, we have addressed the inequity of some energy customers subsidizing others. This important fix levels the playing field and ensures that utility customers don’t end up paying for CCA customers’ power — or vice-versa.”
“Our fight to maintain fairness and accountability in California’s ever-changing energy marketplace is still ongoing, but this vote by the CPUC proves that we have the power to move the needle in the right direction,” Dalzell continued. “We want to thank Commissioner Carla Peterman for proposing this alternative methodology, as well as all the other commissioners who spoke out in favor of this reasonable and necessary change.”