Exit fee: Deciding the fate of California's utilities and customer choice movement

The future of California's biggest utilities may depend on how much customers have to pay to leave them.
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Utility Dive

Promised more renewables and lower utility bills, customers in California are flocking to newly-emerging Community Choice Aggregation (CCA) programs and Direct Access (DA) providers.

But the transition — and the savings — are not that simple. Someone has to pay for the power that investor-owned utilities (IOUs) procured to serve the customers moving to new load serving entities (LSEs).

The California Public Utilities Commission (CPUC) is determining how ratepayers should compensate utilities for procured generation if they move to customer choice organizations. The latest development came on Aug. 2, when the CPUC issued a proposed decision that would redefine the charge CCAs and DAs have to pay when customers migrate to them from traditional investor-owned utilities. And the old-school power companies are not pleased.

The CPUC’s decision fails to assure “customer fairness in the division of the costs of long-term renewables contracts,” Southern California Edison (SCE) Vice President Colin Cushnie told Utility Dive via email.

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