New Municipal Departing Load

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New Municipal Departing Load (NMDL) refers to consumers who locate in PG&E’s service territory as it existed on December 20, 1995 but take electric service from a Publicly Owned Utility (POU) rather than PG&E. A POU is any public entity that qualifies as a local publicly owned electric utility under Public Utilities Code section 9604, such as a municipal utility district or an irrigation district.

Additional information about NMDL can be found in Electric Rate Schedule E-NMDL.

Why Do Consumers Owe These Charges?

• Since the California legislature enacted Assembly Bill 1890 in 1996, NMDL consumers have been obligated, with certain exceptions, to pay various departing load charges related to the costs of California’s electric industry restructuring.
• More recently, a series of decisions by the CPUC mandated that NMDL consumers also owe departing load charges related to the costs of power purchases by the California Department of Water Resources (DWR) during the energy crisis of 2001, as well as costs established by the PG&E bankruptcy decision, unless they meet certain requirements for exemptions.
• PG&E has an obligation to serve all consumers who locate in its service area and the company has incurred certain costs in anticipation of serving these consumers.
• The legislature’s actions and the CPUC’s decisions are designed to ensure that such stranded costs, as well as other costs associated with electric restructuring and the energy crisis, are shared by all Californians on whose behalf those costs were incurred.
• The CPUC has determined that these charges are generally non-bypassable, meaning all consumers locating within PG&E’s service area share the obligation, even if they take service from another provider. However, the CPUC has granted exemptions from some departing load charges to NMDL consumers meeting certain requirements (see “Who is Exempt From Departing Load Charges”).

Consumer Notice

• PG&E will send a written notice to consumers who qualify as NMDL regarding their obligation to pay departing load charges. Included with this notice will be a billing option form. Consumers who intend to take service from a POU must notify PG&E in writing within 30 days of receipt of PG&E’s notice or as soon as the consumer contracts with the POU for service, whichever is later. The consumer’s notice must include:
  • the date when the consumer will take or started taking service from the POU;
  • a description of the load that does or will qualify as NMDL
  • the service address for this load,
  • the name of the POU that will serve or currently serves the consumer, and
  • whether or not the consumer is, or will be, taking natural gas service from PG&E.
• Consumers must indicate on the billing option form how they wish to be billed for retroactive and ongoing departing load charges and provide this form with their notice.
  • Consumers may elect to have their retroactive charges based on 1) PG&E’s estimate of their annual energy usage or 2) actual metered usage for the retroactive time period as measured by their POU.
  • Consumers may elect to have their ongoing charges based on 1) PG&E’s estimate of their annual energy usage, 2) actual metered usage for the last 12 months as measured by their POU or 3) actual metered usage for the month.
  • If the consumer does not indicate a preferred billing option, PG&E will use its estimate of the consumer’s annual usage.
• Within 20 days of receipt of the consumer’s notice, PG&E will send a New Municipal Departing Load Nonbypassable Charge Statement. The statement will show the departing load charges owed by the consumer and any exemptions identified by PG&E. Billing for applicable departing load charges will commence approximately 30 days after the statement is mailed to the consumer.

Departing Load Charges (rates shown are as of 1/1/2008)

• Departing load charges involve costs that have historically been included in bundled service bills and are related to California’s energy crisis and the electric industry restructuring. NMDL consumers will be billed for these charges even if they never received electric service from PG&E. Departing load charges that may apply include:
  • DEPARTMENT OF WATER (DWR) BOND CHARGE: The California Department of Water Resources (DWR) Bond Charge recovers the cost of bonds issued to finance a portion of the historic cost of power purchased by DWR to serve electric customers. The DWR Bond Charge is collected on behalf of DWR and does not belong to PG&E. The current DWR Bond Charge rate is $0.00477 per kwh for all rate schedules. This charge expires in 2022.
  • DWR POWER CHARGE: The DWR Power Charge recovers the uneconomic portion of DWR's prospective power purchase costs. On July 1, 2006, the Power Charge Indifference Adjustment (PCIA) superseded and replaced the DWR Power Charge. After this date, applicable customers no longer incur additional DWR Power Charges but instead incur PCIA charges.
  • POWER CHARGE INDIFFERENCE ADJUSTMENT (PCIA): This adjustment (either a charge or credit) is intended to ensure that customers who purchase electricity from non-utility suppliers pay their share of cost for generation acquired prior to 2003. The currently applicable PCIA is a negative $0.00009 per kWh for all rate schedules. This charge expires in 2012.
  • NUCLEAR DECOMMISSIONING (ND) CHARGE: The ND Charge collects the funds required for site restoration when PG&E’s nuclear power plants are removed from service. The current ND Charge rate is $0.00027 per kwh for all rate schedules. There is no expiration date for this charge.
  • REGULATORY ASSET (RA) CHARGE or its successor, the ENERGY COST RECOVERY AMOUNT (ECRA) CHARGE: These charges repay the principal, interest, and other costs associated with Energy Recovery Bonds established by the PG&E bankruptcy decision. On March 1, 2005, the ECRA Charge superseded and replaced the RA Charge. The current ECRA Charge rate is $0.00337 per kwh for all rate schedules. This charge expires in 2012.
  • COMPETITION TRANSITION CHARGE (CTC): The ongoing CTC recovers the cost of qualifying facilities and power purchase agreements that are in excess of a market benchmark determined by the California Public Utilities Commission (CPUC), as well as a portion of electric industry restructuring implementation costs as authorized by the CPUC. The current CTC rate is $0.00013 per kWh for all rate schedules. This charge does not expire.

Who Is Exempt From Departing Load Charges?

• Consumers may be exempt from one or more departing load charges, depending on certain conditions.
  • ND Charge is owed by all consumers without exception
  • DWR Bond Charge is owed by all consumers, unless the load departed prior to February 1, 2001.
  • DWR Power Charge / PCIA is owed by all NMDL consumers, unless:
    • The load departed prior to February 1, 2001,
    • The consumer is served by a POU that was identified in PG&E’s Bypass Report. These POU’s include Modesto ID, Merced ID, South San Joaquin ID, Laguna ID, Redding, Lodi, Roseville, Davis, and Brentwood, or
    • The consumer is served by a POU that while not listed in PG&E’s Bypass Report, nevertheless was serving at least 100 customers prior to July 10, 2003.
  • CTC is owed by all consumers, unless the Public Utilities Code Section 369 “stand-alone” exemption applies.
  • RAC / ECRA is owed by all consumers, unless:
    • The consumer qualifies for the DWR Power Charge / PCIA exemption noted above,
    • The load departed prior to January 1, 2000, or
    • The load is taking service at a location that as of December 19, 2003 was no longer part of PG&E’s service area.

Monthly Bills

• Regulatory delay in approving these charges allowed a considerable amount of time to pass between the effective date of July 10, 2003 and May 2008, when PG&E expects to commence billing.
• Despite PG&E’s request to bill departing load charges on a going-forward basis only, the CPUC ordered that these charges be billed retroactive to July 10, 2003 or to the date the consumer began taking service from the POU, whichever is later.
  • Rather than bill consumers for the retroactive charges as a lump sum, consumers will be allowed to pay this amount over a 36-month period in equal installments.
• Ongoing charges will be assessed by multiplying usage for the month by the rate currently in effect for each charge.
• Estimated ongoing charges for a typical residential consumer would be approximately $3 per month, plus up to $6 per month in retroactive charges.
• PG&E will issue monthly bills in accordance with the provisions of Schedule E-NMDL. Consumers are required to pay departing load charges in full to PG&E within 20 days of receipt of the bill.

Dispute Resolution

If a consumer believes that the NMDL Nonbypassable Charge Statement does not comply with the terms and conditions provided for in Schedule E-NMDL, the consumer must notify PG&E in writing within 20 days after receipt of the statement. Further information about the dispute resolution process can be found in Section 3.e. of Schedule E-NMDL.