Nearly 90 percent of Sonoma County Pacific Gas & Electric customers are also Sonoma Clean Power customers who may soon be hit with an electric bill increase through no fault of Sonoma Clean Power. Whether this happens depends on a decision to be made today by the California Public Utilities Commission.
The commission will decide whether PG&E and other utilities can increase a previously small charge on customers’ bills. PG&E is requesting the increase as compensation for losses the company claims to have incurred because Sonoma Clean Power customers no longer pay PG&E for power the company says it purchased on their behalf. To be clear, monthly electricity bills wouldn’t increase because Sonoma Clean Power is raising its rates, but because PG&E would be significantly increasing what is known as the Power Charge Indifference Adjustment.
Sonoma Clean Power has enjoyed a spectacularly successful launch and first full year of service. Rates are currently 6 to 9 percent below PG&E rates, including the current Power Charge Indifference Adjustment fee. Sonoma Clean Power customers’ dollars pay for 36 percent renewable energy in the basic power mix, which is about 48 percent lower in greenhouse gas emissions than PG&E’s mix. When Sonoma Clean Power considered rate changes earlier this year, it chose to keep them unchanged from the previous year, in contrast to PG&E’s 30-plus year trend of increasing rates an average of 4 percent per year.
PG&E’s proposed radical increase in the Power Charge Indifference Adjustment fee is among many attempts it has made over the past decade to crush community choice. Its attempts include aggressive anti-community choice marketing, several failed proposed laws in the state Legislature and a failed ballot initiative in 2010 on which PG&E spent $50 million of shareholder money.
The intent behind the Power Charge Indifference Adjustment is to ensure that PG&E customers do not experience any increase in their rates due to the fact that some customers have departed as new community choice customers, making the PG&E customers “indifferent” to the fact that a new community choice program has launched. The premise is that PG&E has made long-term power purchases on behalf of the community choice customers who are no longer full customers of PG&E. However, the way the fee is calculated and what purchases are counted are cloaked in mystery.
The timing of this “adjustment” to the Power Charge Indifference Adjustment coincides with the anticipated launch of San Francisco’s Community Choice program in early 2016. Many other communities in PG&E’s service territory are also on track to establish community choice programs imminently. With a dramatically increased Power Charge Indifference Adjustment, community choice programs lose their competitive edge, and the many communities currently considering Community Choice may abandon it instead.
PG&E cannot raise the fee without the state Public Utility Commission’s approval. You can reach the CPUC at email@example.com.
Woody Hastings is the renewable energy implementation Manager at the Center for Climate Protection, which is based in Santa Rosa.