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Community Choice Aggregation Feasibility Analysis Alameda County 1. An initial period of faster rate growth through 2023 (1.3% above inflation); 2. A period of rate decline from 2023-2026 (2.5%below inflation)primarily due to the retirement of Diablo Canyon28; and 3. A period of dampened rate growth through 2030 (0.2% above inflation)primarily due to the replacement of high-cost renewable power contracts currently in PG&E's portfolio with new lower-priced contracts (reflecting the significant fall in renewable power prices in recent years). PG&E's bundled generation rates in each year of MRW's forecast are shown in Figure 12, on both a nominal and constant-dollar basis. Figure 12: PG&E Bundled Generation Rates, nominal and constant-dollar forecasts 12 nominal doll 10 constant 2016 dolls _ 8 6 4 2 0 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 PG&E Exit Fee Forecast In addition to the bundled rate forecast, MRW developed a forecast of the Power Charge Indifference Adjustment("PCIA"),which is a PG&E exit fee that is charged to CCA customers. 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 "stranded costs" associated with these resources, and CCA customers are charged what is determined to be their fair share of the stranded costs through the PCIA. 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% over the 2016-2018 period(4%in constant dollars) and subsequently to decline in most years 28 More information can be found in the Appendix C July,2016 13 MRW&Associates,LLC