Calif. PUC Sets PG&E Core Brokerage Fee

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December 20, 2010

The California PUC has adopted a final decision which sets the core brokerage fee at Pacific Gas & Electric at $0.025 per decatherm, effective January 1, 2011, and remaining in effect until PG&E's next cost allocation proceeding is resolved (A.09-05-026).

The current core brokerage fee is $0.032 per Dth.  PG&E had applied for a core brokerage fee of $0.0188 per Dth, while core transport agents and competitively served customers were seeking a fee of $0.1347 per Dth, plus procurement personnel and direct overhead costs.

In particular, the competitive supply parties were seeking to include in the core brokerage fee costs related to billing and collection.

The PUC denied this request, finding that statute as well as Commission precedent limit the costs included in the core brokerage fee to procurement and purchasing costs.  The fee cannot include costs associated with customer service fees such as billing and payment policies, meter reading, and safety inspections, the PUC said.

However, despite rejecting the placement of additional costs in the core brokerage fee, the PUC ordered that, in order to, "encourage the continuing growth of competition between PG&E and competing gas suppliers, we will adopt a core brokerage fee of $0.025 per Dth."

"This amount is about mid-way between PG&E's recommended core brokerage fee, and the current core brokerage fee level of $0.032 per Dth, which has resulted in a steady growth of gas customers taking service from competing gas suppliers.  The adoption of a core brokerage fee of $0.025 per Dth is reasonable, and will help maintain a competitive playing field for gas customers considering taking gas from a competing gas supplier," the PUC said.

 

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