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California PUC, CEC Open Review of "Retail Choice"; Set En Banc Hearing

April 12, 2017

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Copyright 2010-17
Reporting by Paul Ring •

The California Public Utilities Commission (CPUC) and the California Energy Commission will hold a joint En Banc Hearing with Commissioners of both agencies attending to discuss the changing state of retail electric choice in California on May 19 in Sacramento

Note the use of the term "retail electric choice" by the agencies, a broader term than direct access, which is the term used in California to describe a customer's ability to take competitive supply from a non-utility LSE. The agencies' review will include alternative choice mechanisms including but not limited to opt-out community choice aggregation, rooftop solar, and community solar generation

"By the end of 2017, 30-40 percent of California’s investor-owned electric utility customers will be receiving some type of electricity service from an alternative source and/or provider, such as Community Choice Aggregators, rooftop solar, or Direct Access providers. Projections suggest that this number will grow to well past 80 percent by the middle of the next decade," the agencies said in a news release

"The goal of this joint agency En Banc is to identify and begin to develop an understanding of the challenges and opportunities that the CPUC and the California Energy Commission must examine as a result of these fast approaching changes in order to ensure that affordable, reliable and low-carbon electricity will be available to all California consumers. Part of this overview will look at the role of the investor-owned utilities in a future in which customer-oriented technologies disrupt the traditional top-down electricity service model," the agencies said

"Unlike electricity restructuring efforts of the past, when policymakers made a set of conscious decisions to move to open market competition, this transition is being driven by a range of economic and technological trends. Rapidly declining prices for solar PV, wind, and battery technologies are up-ending the nature of electricity service. The implications of this migration away from 'bundled' utility service were not fully contemplated when the current regulatory rules were developed. These changes present tremendous opportunities to achieve the deep de-carbonization pathway that California has set for itself, but they also create unforeseen risks," the agencies said

In an effort to clearly communicate the goals of this En Banc and describe a set of potential next steps, the CPUC will be issuing a White Paper that describes how California got to where it is today, articulates key lessons learned from past efforts to restructure retail electricity markets, and proposes a set of principles to consider as changes to both the regulatory and statutory frameworks surrounding retail electricity service are contemplated.

A preliminary agenda for the hearing is as follows:

• Introductory Remarks from PUC President Michael Picker, CEC Chair Robert B. Weisenmiller and Invited Legislators

• Staff Presentation on Retail Choice White Paper

• State of Customer Choice in California: Overview and discussion of current state of customer choice in California featuring representatives from Community Choice Aggregators, rooftop solar, Direct Access, and Community Solar

• Panel Discussion: IOU Perspective on Current State of Retail Electricity Market and Coming Changes: This panel is an opportunity for California’s three largest investor-owned utilities to discuss current challenges and lay out their vision for the evolution of retail electricity choice and their role in its provision

• Panel Discussion: What Customers Want: Overview and discussion of priorities and requirements of major customer categories, including the types of retail electricity choices they want, key consumer protection concerns, and general view on the structure of California’s retail electricity market

• Thought Leaders and the Future of Retail Electricity Service: This section will be an opportunity for national electricity market experts to share their perspectives on: a) lessons learned from other markets where retail choice exists, b) their view on the role that technology will play in transforming retail electricity service, and c) their thoughts on how California can restructure both its regulatory framework and market structure to at once achieve its public policy goals (affordability, reliability, and low carbon) and account for technological innovation

• Impressions and Reflections from CPUC, California Energy Commission and Legislature

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