PG&E Proposes Reforms to Support the State’s Clean Energy Future

SAN FRANCISCO–(BUSINESS WIRE)–Today, Pacific Gas and Electric Company (PG&E), along with Southern
California Edison and San Diego Gas & Electric, proposed a new plan that
supports the state's clean energy goals, protects customer choice and
ensures that all electric customers are treated equally.

The proposal offers a replacement to the Power Charge Indifference
Adjustment (PCIA) framework, supports continued Community Choice
Aggregation (CCA) growth and ensures equity among all customers.

The new proposal finds the right balance for the state's energy future
by:

• Ensuring all customers are treated equally and pay their fair share
  while maintaining customers’ right to receive service from an
  alternate energy provider and protecting customers who choose to
  remain with their utility.
• Sharing the costs and benefits of investments in renewable and
  hydroelectric resources with the customers for whom the resources were
  procured or built. This will ensure CCAs continue to grow and that all
  customers equitably share in the state’s clean energy policy goals.
• Improving the process for sharing costs related to other energy
  resources by eliminating cost estimates and replacing them with actual
  costs, with the aim of allocating costs fairly between customers.

"We can achieve the state's clean energy goals while also supporting
customer choice and treating all customers fairly and equally," said
Steve Malnight, senior vice president of Strategy and Policy for PG&E.

Why the PCIA Needs to be Updated

Starting in 2002, California committed to clean energy and the
infrastructure needed to deliver it by investing in long-term clean
energy contracts that must be paid for over the next 20 years. At the
time, this kept energy costs stable for all Californians.

Also in 2002, California’s legislature authorized the formation of CCAs,
allowing cities and counties to purchase and/or generate electricity for
their residents and businesses. The first CCA began in PG&E’s service
area in 2010. Likewise, customers can choose to receive their
electricity from other third-party suppliers called Energy Service
Providers (ESPs). For both CCA and ESP customers, PG&E continues to
deliver the energy and provide meter reading, billing, maintenance and
emergency response services.

Today, communities that choose to implement CCA programs or customers
that choose ESPs are responsible for the PCIA charge associated with
energy resources procured on their behalf. PG&E does not make any money
on the PCIA. The PCIA charge is required to ensure that all customers
are treated equally and do not pay for other customers’ share of costs.

However, the current PCIA formula has become unbalanced over time due to
the growth of CCAs. In 2017, CCA customers only paid approximately 65
percent of the costs associated with the energy resources procured on
their behalf. This imbalance required PG&E customers who were not part
of a CCA to pay approximately $180 million to subsidize CCA customers.
Assuming this trend continues, in the early 2020s this amount is
expected to grow to half a billion dollars, which is equal to the
current PG&E low-income subsidy.

The full filing can be read here.

About PG&E

Pacific Gas and Electric Company, a subsidiary of PG&E
Corporation (NYSE:PCG), is one of the largest combined natural gas
and electric energy companies in the United States. Based in San
Francisco, with more than 20,000 employees, the company delivers some of
the nation’s cleanest energy to nearly 16 million people in Northern and
Central California. For more information, visit www.pge.com/
and www.pge.com/en/about/newsroom/index.page.

Contacts

Pacific Gas and Electric Company
Media Relations, 415-973-5930