PCIA Reset Incoming: Track 3 Opens the Door to Repricing Cost Responsibility

EXECUTIVE SUMMARY

Track 3 of R.25-02-005 is shaping up to be the most consequential PCIA proceeding since the CPUC's 2017 overhaul, with parties filing divergent comments on scope, sequencing, and data access.

• The Joint Utilities (PG&E, SCE, and SDG&E) want fast and specific benchmark fixes;
• CalCCA wants a full reset, gated behind a data-access protocol; and
• TURN filed the most technically specific comments, targeting a broken RPS Market Price Benchmark and the lack of monthly granularity (issues with cost-recovery implications well beyond this proceeding).

How the CPUC sequences these competing demands will determine whether Track 3 produces narrow rate stabilization outcomes by 2028 or a multi-year redesign of the fundamental cost-sharing bargain between bundled and departed load.

What Happened and When: In February, the CPUC issued a ruling in the Energy Resource Recovery Account and Power Charge Indifference Adjustment reform rulemaking (R.25-02-005). The ruling directed the investor-owned utilities (and invited other parties) to file comments on the scope of Track 3.

Parties were asked to identify scope, prioritization, data constraints, and timing. This is the phase where broader policy questions (deferred in earlier tracks) will be resolved.

On March 27, parties submitted their comments.

PARTIES' POSITIONS

• The Joint Utilities want to split Track 3 into two phases: a fast track to fix the most volatile benchmark calculations now, and a slower track to tackle deeper structural questions, including whether negative PCIA charges should be returned to customers. They point to more than $4 billion in cumulative billing shortfalls for SCE customers alone to justify moving quickly on the first phase.
• CalCCA wants to reopen the entire cost-sharing framework from the ground up (including alternatives such as changes to cost allocation, financing mechanisms, and long-term PCIA design). Before any of that work begins, CalCCA wants a formal data-sharing protocol established so CCA representatives can access the utility portfolio data needed to evaluate proposals. This would be modeled on a process from the 2017 PCIA proceeding, with at least six months of analysis time after data is received.
• TURN focuses on two specific fixes: reforming the RPS Market Price Benchmark to include long-term fixed price contracts currently excluded from the calculation, and developing monthly rather than annual MPB values. The RPS MPB has risen nearly 500% since 2022 due to reliance on a thin slice of short-term transactions, producing benchmark values that imply long-term contracts have zero or negative energy and Resource Adequacy value (a result TURN characterizes as illogical).
• The Alliance for Retail Energy Markets and Direct Access Customer Coalition support a broad reform scope and propose spreading large accumulated billing imbalances (which have reached $2.2 billion for PG&E alone) over 18 to 24 months rather than recovering them in a single year.
• The California Large Energy Consumers Association pushes for a careful, no-regrets schedule through mid-2027, prioritizing rate affordability, indifference across bundled and unbundled customers, and alignment with Slice-of-Day RA implementation.

INSTANT ANALYSIS

Track 3 is where parties are positioning to reset the cost-sharing bargain between bundled and departed load.

• The utilities want targeted fixes that stabilize benchmarks before the broader framework hardens. CalCCA wants to reopen the design before those fixes become precedent.
• The data-access dispute is the procedural lever. If the Commission adopts CalCCA’s sequencing, Track 3 becomes a multi-year redesign. If it follows the utility path, benchmark changes will flow into 2028 rates while deeper reforms slip.
• TURN’s monthly MPB argument is the sleeper issue. The Diablo Canyon proceeding showed that annual averaging distorts cost recovery when expenses are time-skewed. That logic extends across ERRA and General Rate Case proceedings. This is not a niche fix: it is a potential rewrite of how timing mismatches are priced.