Menlo Park's City Council may vote Tuesday, Dec. 15, to send a letter to the California Public Utilities Commission opposing PG&E's plans to double its exit fees for customers who opt out of its services for a "community choice" clean electric energy program.
An increasing number of the community-choice programs are being organized by local government agencies, including San Mateo County, to give customers the choice of buying more electric energy from renewable sources.
PG&E proposes to increase its monthly exit fee to 2.32 cents per kilowatt hour from 1.16 cents per kilowatt hour, according to a staff report.
While that may not sound like much, it means a jump in monthly added fees to $13 from $6.70 for the average customer of Marin Clean Energy, an existing community choice energy program in Marin County, according to the San Francisco Chronicle.
The draft of the letter says the hike would "profoundly affect the viability" of a local community choice energy program and its capacity to be a financially appealing option for residents.
The California PUC plans to hold a hearing on the fee hike at 9:30 a.m. Thursday, Dec. 17, at 505 Van Ness Ave. in San Francisco.
Menlo Park's City Council is considering a plan to join Peninsula Clean Energy, San Mateo County's community choice energy initiative, which would leverage energy demand across participating cities to purchase electric energy that is renewable and does not emit greenhouse gases at prices competitive to PG&E's.
Council discussions so far have focused on the default percentage of clean energy the city should advocate for, but council members have been wary of variations that would increase the cost to residents.
As more counties consider adopting community choice energy programs, PG&E's claim over its 16-million-customer base in California is threatened by competition from more environmentally friendly energy sources. One way it's fought competition has been through its exit fee, called a "Power Charge Indifference Adjustment," which essentially charges PG&E's ex-customers monthly for the energy the company had previously purchased to serve its customer base before the switch to a community choice energy alternative. According to its website, PG&E says the charge exists "to ensure that PG&E's remaining customers do not bear any cost created by departing customers who receive their electric supply from a third-party provider, such as a CCA."
According to the California Alliance for Community Energy, an advocacy group for clean energy in California, PG&E "continued to procure electricity for customers even when it was clear that they would be departing for their local Community Choice program" and continues to expect former customers to subsidize energy they won't use.
The increased fees would also apply to low-income PG&E customers who qualify for the California Alternate Rates for Energy Program, or "CARE," the group said.
PG&E has long opposed community choice energy programs. In 2010, it contributed $44.1 million of the $44.2 million raised for Proposition 16, which would have required that two-thirds of voters in participating local governments approve a community choice program before it could receive public funds, but the proposition was defeated.
In response to the campaign, a law called SB 790 was passed in 2011 banning utility companies from using customer money to lobby against community choice energy programs.