PL/pgSQL functions and optimizations fences? I am newbie on DB stuff. And my DB knowledge is very old (around MSSQL2000). All what I remember is, the stored procedures are faster than ordinary queries because it avoid query compilation and optimization. 

I know PG has two types of query caching options. Prepared statement (temporary cached query) and function (persistent cached query, which is stored procedure in MSSQL).

Anyway, today I heard the concept of optimization fence. Which is the optimizer sees functions as opaque black box, so cannot optimize the inside. Conceptually it could be right.

Is this true even if the functions are fully written only with PL/pgSQL? Or just a limitation only to non-SQL languages? Do I have any chance to get better performance by using PL/pgSQL?
Functions written in language SQL can under certain conditions (e.g., no side effects) be "inlined" (at the discretion of the optimizer), in which case they will take part in the query plan optimization.  Functions written in all other languages (including PL/pgSQL) will not take part in the optimization of the main query, so they are indeed optimization fences, as you call it.

On the other hand, a query run by a PL/pgSQL function will be compiled and prepared the first time it is run, so subsequent calls of that function (even as part of the same top-level query) will be faster.  SQL functions do not implicitly prepare the queries they run, so if inlining of an SQL function fails, repeated calls will probably slower.

In practice, it depends on the specific circumstances which is faster.  Generally, I stick to the basic rule of using LANGUAGE SQL when it's possible and LANGUAGE plpgsql only when I need the additional expressive power.  But it's definitely a useful microoptimization strategy to compare implementations in the two languages.