Close

September 13, 2019

PUCT staff recommends no action based on 2018 earnings reports

by Kelso King, Grid Monitor
Posted 09/12/2019

At the Texas PUC’s September 12 Open Meeting, Chairman Walker and Commissioner D’Andrea supported Staff’s recommendations to take no action.

PUCT staff confirmed that San Miguel Electric Cooperative (D-49900) and Lyntegar Electric Cooperative (D-49943) had recently filed applications to update their wholesale transmission rates. Staff also informed the Commission that they had recently spoken with Julia Harvey, Texas Electric Cooperatives’ director of regulatory affairs, who had informed them that all of the companies identified as needing to file something are aware that they are scheduled to file.

Background

On September 5, 2019, Staff filed a memo summarizing the results of Staff’s review of the year-end 2018 PUC Earnings Reports. Staff did not identify any of the 13 investor-owned electric utilities (IOU) companies or 38 electric cooperatives, municipalities, and river authorities as warranting a more detailed analysis at the present time. Staff noted that many of the IOUs have recently received Commission rate orders or have rate proceedings pending but that the ROEs of ETT, Cross Texas and Lone Star are “worthy of continued scrutiny.”

Staff noted that WETT’s ROE had previously been a concern and the Commission had ordered WETT to file a comprehensive rate case by February 13, 2019. Subsequently, WETT reached an agreement with parties to reduce its revenues by $16 million. That $16 million rate reduction was not effective until January 1, 2019; therefore, WETT’s reported ROE of 13.46% for 2018 does not reflect this reduction. Staff concluded, however, that ROEs of such magnitude “clearly warrant ongoing scrutiny,” and they will closely monitor the year-end 2019 information included in WETT’s next earnings report.

Leave a Reply

Your email address will not be published. Required fields are marked *