SCE General Rate Case Phase 2: Reply Briefs

On November 7, we reported on parties' opening briefs in SCE's General Rate Case Phase II (A.24-03-019), which addressed three main issues:

• SCE’s proposed TOU-D-PRIME Plus rate;
• Baseline allowance treatment; and
• Transmission marginal costs.

Opening briefs demonstrated that SCE is pushing PRIME Plus as a new form of residential pricing (with a higher fixed charge, demand charge, and lower volumetric rates).

Cal Advocates and the Solar Energy Industries Association (SEIA) both argued the proposal is misaligned with real grid stress, is unsupported by customer data, and is potentially unlawful due to the inclusion of non-marginal distribution costs in the fixed charge. TURN injected NEM into the discussion, with another variation of the ongoing cost-shift argument.

With reply briefs, parties continue to diverge over the proposed TOU-D PRIME Plus rate, the adoption of marginal transmission capacity costs (MTCC), and a proposed Vehicle-to-Grid Resource Proposal settlement.*

• SCE defends PRIME Plus as an optional, cost-based rate aligned with Commission policy, arguing that residential customers can understand the peak-usage demand feature, that the fixed charge properly recovers non-marginal distribution costs, and that the rate improves cost causation and load-shifting incentives, while also rejecting TURN’s baseline allowance proposal and SEIA’s MTCC proposal.
• SEIA urges the Commission to reject PRIME Plus entirely, arguing it violates D.24-05-028,** is not cost-based, creates perverse incentives by weakening volumetric price signals after a single peak-hour spike, and lacks any demonstrated evidence of customer comprehension, while also asserting that adopting MTCC for SCE is proper and necessary for state-jurisdictional uses despite SCE and Cal Advocates’ objections.
• Cal Advocates likewise opposes PRIME Plus, arguing SCE has provided no empirical evidence of customer or grid benefits, improperly equates demand charges with TOU price ratios, and ignores that dynamic pricing pilots offer more accurate and targeted signals. Cal Advocates also rejects SEIA’s MTCC proposal as inflated, unsupported, out-of-scope, and duplicative of the ongoing statewide Transmission & Distribution cost-study effort.

Finally, the Vehicle-Grid Integration Council supports the proceeding's Vehicle-to-Grid Resource Proposal settlement, arguing that using the Avoided Cost Calculator for export compensation is consistent with CPUC precedent, aligns with the Net Billing Tariff framework, and is essential to scaling bidirectional EV charging as a meaningful grid resource, and that Cal Advocates’ objections should be dismissed.

Instant Analysis: SCE’s TOU-D PRIME Plus proposal is headed into a heavily contested decision window with all non-utility parties. Opponents see the rate as having various evidentiary weaknesses:

• No empirical load-shift analysis;
• Unclear customer comprehension; and
• Unresolved questions about fixed-charge legality under D.24-05-028.

Consequently, PRIME Plus looks increasingly fragile unless the Commission is willing to bless a novel residential demand charge on policy grounds rather than record strength.

Meanwhile, the MTCC debate shows no appetite from the Commission’s own Cal Advocates to adopt SEIA’s $73/kW-year value, especially with the statewide Transmission & Distribution cost study underway. That makes MTCC adoption in this GRC Phase 2 unlikely.

By contrast, the Vehicle-to-Grid Resource Proposal settlement stands on firmer footing, with its Avoided Cost Calculator-based export methodology aligning with the Net Billing Tariff precedent and offering clear policy upside for VGI development.

FOOTNOTES

*In this settlement SCE, SEIA, the Vehicle-Grid Integration Council, CALSTART, and the Small Business Utility Advocates resolve all issues surrounding SCE’s proposed Vehicle-to-Grid Resource Proposal, a new retail program that would allow electric vehicles equipped with bidirectional charging to export power back to the grid under structured, cost-based compensation rules. The agreement creates two program pathways:

• One for standalone EV export systems; and
• One for for systems paired with Net Energy Metering, NEM-Successor Tariff, or Net Billing Tariff solar/storage configurations (each operating as a rider layered onto existing Time-of-Use, electrification, or dynamic-pricing rates).

**D.24-05-028 implemented Assembly Bill 205 by authorizing all investor-owned utilities to overhaul residential rate design so that a portion of fixed electric-system costs is recovered through an income-graduated monthly fixed charge rather than solely through per-kWh rates.