Pending Resolution from California Regulators Risks Millions in Utility Ratepayer Investments
On February 11, the California Public Utilities Commission issued a draft resolution (Resolution E-5440) that it is likely to vote on in early March. The resolution—which concerns necessary improvements to an important grid transparency tool called an Integration Capacity Analysis, or ICA—raises serious concerns about whether the Commission is committed to ensuring that this tool, which has been over ten years in the making and has cost ratepayers millions, ever achieves its intended functionality.
Problems with the state’s ICA data have been well documented since the first full versions of the ICA were published in 2019. Though these issues prevent the tool from being used as intended, over the last few years, the Commission has repeatedly declined to require the state’s investor-owned utilities to fix the issues and comply with the Commission’s own regulations. The CPUC’s new resolution continues the trend by failing to resolve the known issues.
Comments on the draft resolution are due next Tuesday, March 3, with replies to those comments due Monday, March 9th. Barring a decision from the Commission to revise the resolution after comments are received, a vote is expected on March 19, 2026. This is a critical moment in California utility regulation that will determine whether additional years go by in which ratepayer funds are wasted on a tool that does not work as intended, or whether the Commission will hold the state’s utilities accountable to ensuring the ICA provides the minimum functionality that the Commission has already mandated.
California’s ICAs: What Are They, What’s Wrong, and Why Does It Matter?
California’s Integration Capacity Analyses (ICAs) are grid transparency tools that are intended to help the state meet its clean energy and electrification goals by providing data that enables developers to advance projects efficiently and affordably. Presented as maps, the ICAs show where there is capacity on the electric grid to add new electric generation (like solar projects) or load (like electric vehicle charging stations), without the need for costly and time-consuming upgrades to grid infrastructure. Each of California’s major investor-owned utilities (IOUs)—Pacific Gas & Electric (PG&E), Southern California Edison (SCE), and San Diego Gas & Electric (SDG&E)—was ordered to create an ICA, starting with a pilot program in 2015.
Unfortunately, since the first full ICAs were published in 2019, the ICA data utilities provide has consistently been too incomplete, inaccurate, outdated, or redacted to be used for intended purposes. Additionally, in the years since the first ICAs were published, the Commission has established numerous other policies and practices for clean energy and EV charging projects that depend on this tool. For example, under a rule published in 2020, ICA data should be used to streamline the process of approving clean energy projects to interconnect to the grid. It is also the basis for a program in which clean energy projects can propose operating schedules to stay within current grid capacity to avoid having to pay for grid upgrades. Without improvements, both the original intended value of the tool and the related policies that depend on it, will not be realized.
Affordability is another key issue at play in the resolution. If the ICA were functional, it could help avoid millions of dollars in distribution upgrade costs by directing customers to locations with existing capacity instead of those requiring costly and time-consuming grid upgrades, which utility ratepayers will have to pay for. This is a vital option to limit increases in electricity rates. Adding insult to injury, California’s IOUs have collectively spent millions of ratepayer dollars on a tool that still does not work properly despite over a decade of work. Under the current resolution, ratepayers will continue to fund utilities’ related activities to produce the ICA without any actual improvements in its quality.
California already has the highest electricity prices in the continental U.S. At a time when rapidly rising electricity prices are a critical concern for Californians, a resolution that fails to require any fixes or penalize utilities for lack of compliance sends the message that the Commission is not committed to holding its regulated utilities accountable for responsible spending of ratepayer funds—which directly contribute to electricity prices.
Specifics of the Resolution
There are three primary issues that currently prevent the use of ICAs for their intended purposes. First, questions about the accuracy of the ICA have persisted since its completion in 2019. While some of the glaring problems have been remedied, it is undisputed that SCE’s Load ICA does not produce results that align with actual grid conditions. The Load ICA is intended to identify where there is capacity on the grid to develop EV charging stations and other sources of energy consumption. SCE’s is clearly failing to do that. For example, though the quality of the data provided was poor, a recent report from SCE appears to demonstrate that, out of 507 EV charging applications, ICA results were not aligned with actual grid conditions in 43% of cases.
Rather than requiring the issue to be fixed, the Commission orders utilities to report on whether ICA results align with interconnection outcomes and to file letters recommending (but not implementing) improvements, “no earlier than 18 months and no later than 30 months.” Given that utilities are unlikely to file recommendations before they are required to, this all but assures that there will be no steps to improve the ICA for several more years. While there is value in this reporting, when it comes to SCE’s Load ICA, there is no reason to wait for more data; it will not change the need for a solution. The Commission should require SCE to fix the Load ICA by the end of 2026, and shorten the timeline for action on the reporting significantly.
Second, data redaction: SDG&E continues to redact excessive information from its ICA. It has engaged in these redaction practices since it first published its ICA; the Commission previously ordered SDG&E to discontinue the practice, yet it continues to violate past orders. The Commission’s draft resolution oddly acknowledges that SDG&E is not in compliance with the orders, but only requires it to publish two additional data fields rather than the actual ICA results. This change will not help projects locate sites, and the draft resolution offers no explanation of why the Commission is not requiring publication of the data that it previously ordered. The Commission should require full utility compliance with its own data transparency orders.
Third, because grid conditions change rapidly as new projects are developed, ICA data is only useful if it is regularly updated. The Commission previously ordered all of the state’s IOUs to update the ICA for all circuits with changed conditions on a monthly basis. This is the bare minimum necessary for ICA usability, yet PG&E and SCE continue to fail to meet this requirement. Although the resolution acknowledges that the monthly updates are required, it does not order the utilities to come into compliance or create any consequences for failure to meet the required cadence.
This is a critical moment for California regulators to show that they take seriously their responsibility to regulate the state’s investor-owned utilities and enforce rules that have already been on the books for multiple years without utility compliance. Interested parties can submit public comments through March 9th to express their desire for the Commission to hold utilities to account and require a usable ICA (customizable comments can be found here). Functional ICAs can help accelerate the efficient and affordable transition to clean energy and electric transportation.
