ERRA/PCIA Reform, Track 2: Who Gets Credit for a Decade-Old REC?

SCE and other parties filed a joint prehearing conference statement in the CPUC’s ERRA/PCIA reform docket, outlining positions for Track 2, which is narrowly focused on whether Renewable Energy Credits generated before January 1, 2019 should carry a ratemaking value.

The investor-owned utilities argue that pre-2019 banked RECs were fully valued under the former PCIA methodology and that assigning a new value now would violate statutory indifference and impose retroactive cost shifts on bundled customers. CalCCA, the Alliance for Retail Energy Markets, and the Direct Access Customer Coalition argue that customers who later departed bundled service may be entitled to credits when those RECs are used for current Renewables Portfolio Standard compliance.

Additionally:

• Cal Advocates proposes broadening the scoping issues to address differences between pre-2019 and post-2019 indifference methodologies, not just REC characteristics;
• CLECA explicitly takes no position on Track 2 issues at this time; and
• CalCCA notes the pre-2019 banked REC valuation question has been litigated eleven times in prior proceedings without settlement, making adjudicated resolution likely necessary.

A procedural wrinkle: two 2025 decisions (D.25-12-027 and D.25-12-028) require IOUs to implement any guidance issued before September 1, 2026, but the proposed Track 2 schedule targets a September 3 voting meeting. CalCCA asks the IOUs to voluntarily commit to implementing guidance from a September 3 decision. CalCCA also raises data access concerns relevant to Track 3 and questions SCE's confidentiality designations around pre-2019 banked REC usage.

INSTANT ANALYSIS: This filing presents a narrow but consequential Track 2 dispute over whether pre-2019 banked RECs should carry any ratemaking value under the PCIA. The IOUs argue these RECs were already valued under the former PCIA framework and that re-valuation would violate statutory indifference by shifting costs onto bundled customers. CalCCA, AReM, and DACC argue that customers who later departed bundled service may be owed credits when those same RECs are used for current RPS compliance.

The disagreement concerns whether the Commission can revisit legacy REC treatment without reopening prior rate outcomes. If the Commission adopts a non-zero value, that could affect ERRA forecast mechanics, PCIA calculations, and future REC market behavior. Maintaining a zero-dollar value would reinforce the post-2019 framework and limit further challenges to legacy REC treatment.