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Psychic Magic

Undercasting Spells

Source Occult Adventures pg. 144
Some psychic spells can be undercast. This means that the spellcaster can cast the spell at the level that he knows, or as any lower-level version of that spell, using the appropriate spell slot. When a spellcaster undercasts a spell, it is treated exactly like the lower-level version, including when determining its effect, saving throw, and other variables. For example, a psychic spellcaster who adds ego whip III to his list of spells known can cast it as ego whip I, II, or III. If he casts it as ego whip I, it is treated in all ways as that spell; it uses the text and the saving throw DC for that spell, and requires him to expend a 3rd-level spell slot.

Whenever a spontaneous spellcaster adds a spell to his list of spells known that can be undercast, he can immediately learn a spell in place of each lower-level version of that spell he knows. In essence, he loses each earlier version and can replace it with another spell of the same level that is on his spell list.