Understanding the PCIA Fee

Power Charge Indifference Adjustment

PG&E’s 2021 PCIA Fee Increase

Since Pioneer Community Energy’s founding in 2018, its customers have been required to pay PG&E’s Power Charge Indifference Adjustment (PCIA) fee in addition to paying Pioneer’s generation rates. 

In 2021, PG&E raised its PCIA fees by 33%, an increase that Pioneer customers and all Community Choice Energy providers across California will pay throughout 2021.

What is PG&E’s PCIA fee? 

PG&E’s PCIA fees are “exit fees” charged to former PG&E customers so that the investor-owned utility doesn’t lose money. State law allows PG&E to recover the difference in the value of energy resources already contracted by PG&E prior to the acceleration of its shrinking customer base due to the popularity of Community Choice aggregators of electricity like Pioneer.

The PCIA fee represents previous PGE customers’ share of the difference in the dollar amount between the cost of PG&E’s energy supply portfolio and the current market value of it. 

Why is PG&E’s PCIA rate calculation concerning?

PG&E’s PCIA Fee has increased by approximately 600% since 2013, with a 33% increase since 2020, and PG&E is not held to a standard of transparency around calculating PCIA fees, nor subject to auditing to determine accuracy. Pioneer maintains that this lack of transparency demonstrates why Placer County residents and businesses deserve local control of their energy choices.

Affordability and rate certainty are two guiding principles that should apply to all customers. We need a system that requires PG&E to optimize their energy portfolios by more actively managing long-term contracts and increasing transparency into the PCIA process in order to reduce costs.

What is Pioneer doing about PG&E’s PCIA fees?

Pioneer is our community voice for energy independence, fighting for more transparency in PG&E’s PCIA fee, and advancing legislation and regulation that benefits our communities at the state level and with PG&E. Pioneer continues to challenge the PG&E PCIA fee methodology by:

    • Engaging with a collective of other Community Choice Aggregators (CCAs) through the California Community Choice Association to reduce PG&E’s PCIA fee.
    • Requesting data transparency.
    • Eliminating PG&E Utility-Owned Generation from the PCIA calculation.

Since one of Pioneer’s goals is a commitment to stable and competitive rates, how does PG&E’s PCIA fee affect this trend?

Pioneer strives to provide stable and competitive rates. Through the end of 2020, we have averaged an overall generation rate (inclusive of PG&E’s PCIA fee) of 8.15% lower than PG&E. We are proud to have kept generation costs stable since October 2019 and to offer our customers the lowest generation rate compared to other CCAs in the state, according to the most recent data.

Although some Pioneer rate classes will remain lower than PG&E, the latest increase has caused other customer rate classes to be higher than PG&E’s. PG&E’s PCIA fees do not benefit Pioneer whatsoever but instead go directly to PG&E. 

PG&E’s PCIA fee fluctuates annually but will sunset as PG&E’s contracts expire.

Pioneer’s Rate History & PG&E’s PCIA Fee Increase Chart

Why does it look like Pioneer’s rate has increased on my bill?  Pioneer’s generation rate is comprised of its generation costs plus PG&E’s PCIA fees. However, this fee does not benefit Pioneer and goes directly to PG&E.

How has Pioneer supported Placer County?

Pioneer Community Energy is the locally controlled, collective voice of Placer County that negotiates predictable electricity supply contracts with combined buying power while progressing toward independence from investor-owned PG&E. Pioneer also acts as a local hub of economic energy innovation by discovering and sourcing electricity locally, reinvesting in the local economy and advancing policy and legislation that benefits our customers.

Our Power. Our Choice. Our Investment. The California Energy Industry is a $138 billion business, and we believe that those dollars should be reinvested in the local community, not distributed among investor-owned PG&E’s shareholders.

Pioneer’s commitment to customer savings, advancing the local economy and creating local jobs includes:

    • Since launching in February 2018, Pioneer has saved its customers over $32 million.
      • $32 million that did not go to PG&E but was reinvested locally.
    • Pioneer offers the Arrearage Management Plan (AMP) Program to help customers during the pandemic.
      • The AMP Program helps qualifying residential customers pay unpaid balances on their bills by offering up to $8,000 in debt forgiveness for on-time payments.
    • In 2020 alone, Pioneer contributed $4.9 million locally.
      • $3.5 million to the local economy.
      • $1.4 million through the mPOWER program to local residents and businesses.
    • Pioneer advocated for our agricultural customers, saving them $143,000 by deferring their Time of Use enrollment. 

Pioneer, in addition to fighting for more transparency in PG&E’s PCIA fee, has advanced legislation and regulation that benefits our communities at the state level and with PG&E:

    • Championed legislation to ensure Mobile Home Park residents initially in Placer County and now throughout California receive CCA benefits and savings.
    • Assisted in minimizing Public Safety Power Shutoff (PSPS) events from PG&E.
      • Identified a solution to power up the Auburn Police Department during PSPS events.
    • Co-sponsored AB 843 BioMAT bill allowing CCA’s access to BioMAT programs, encouraging local bioenergy production.
    • Heard our community’s request for a 100% renewable energy and created a product to be available in June 2021.

Should you have any further questions, please forward to our Pioneer team at info@pioneercommunityenergy.ca.gov or call (916) 758-8969.  

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