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Community Choice Aggregation Feasibility Analysis Alameda County <br />June, 2016 13 MRW & Associates, LLC <br />Figure 12: PG&E Bundled Generation Rates, nominal and constant-dollar forecasts <br /> <br />PG&E Exit Fee Forecast <br />In addition to the bundled rate forecast, MRW developed a forecast of the Power Charge <br />Indifference Adjustment (“PCIA”), which is a PG&E exit fee that is charged to CCA customers. <br />The PCIA is intended to pay for the above-market costs of PG&E generation resources that were acquired, or which PG&E committed to acquire, prior to the customer’s departure to CCA. The total cost of these resources is compared to a market-based price benchmark to calculate the <br />“stranded costs” associated with these resources, and CCA customers are charged what is <br />determined to be their fair share of the stranded costs through the PCIA. <br />MRW forecasted the PCIA charge by modeling expected changes to PCIA-eligible resources and to the market-based price benchmark through 2030, using assumptions consistent with those used in the PG&E rate model. Based on our modelling, we expect the PCIA to increase by 8% <br />over the 2016-2018 period (4% in constant dollars) and subsequently to decline in most years <br />until it drops off completely in the late 2030s. MRW’s forecast of the residential PCIA charge <br />through 2030 is summarized in Table 3. <br />Table 3. PG&E Residential PCIA Charges, ¢/kWh (nominal) <br />2015 2018 2020 2025 2030  <br />2.3 2.5 2.2 1.1 0.9  <br /> <br />Pro Forma Elements and CCA Costs of Service <br />MRW conducted a pro forma analysis to evaluate the expected financial performance of the <br />CCA and the CCA’s competitive position vis a vis PG&E. The analysis was conducted on a <br />forward looking basis from the expected start of CCA operations in 2017 through the year 2030, <br />with several scenarios considered to address uncertainty in future circumstances.