(7)(h)
CITY COMMISSION REGULAR MTG
- Meeting Date:
- 03/20/2024
- Title:
- Suspending the April 10, 2024 effective date of CenterPoint Energy requested rate change
- Submitted For:
- Jon Branson
- Submitted By:
- Jon Branson, Management Services
- Department:
- Management Services
Information
ACTION REQUEST
Approval of Resolution No. 2024-050, suspending the April 10, 2024, effective date of CenterPoint Energy Houston Electric, LLC's requested rate change to permit the City time to study the request and to establish reasonable rates.
BACKGROUND (Brief Summary)
The resolution suspends the April 10, 2024, effective date of CenterPoint Energy's rate increase for the maximum period permitted by law to allow the City, working in conjunction with other members of GCCC served by CenterPoint, to evaluate the filing, determine whether the filing complies with law, and if lawful, to determine what further strategy, including settlement, to pursue.
The law provides that a rate request made by an electric utility cannot become effective until at least 35 days following the filing of the application to change rates. The law permits the City to suspend the rate change for 90 days after the date the rate change would otherwise be effective. If the City fails to take some action regarding the filing before the effective date, CenterPoint’s rate request is deemed approved.
The City of Texas City, Texas is a member of a coalition of political subdivisions in the Greater Houston area known as the Gulf Coast Coalition of Cities (“GCCC”). GCCC has been in existence since the early 1990s. The GCCC represents the interests of its members on gas and electric utility matters before the Public Utility Commission of Texas, the Railroad Commission of Texas, the Electric Reliability Council of Texas, and the courts. For the past 20 years, GCCC has protected the authority of municipalities over monopoly electric and natural gas providers and has defended the interests of the residential and small commercial customers within the cities. Cities are often the only consumer advocates that work to keep utility rates reasonable. The work undertaken by GCCC has saved ratepayers millions of dollars in unreasonable charges. GCCC has previously approved the hiring of Lloyd Gosselink Rochelle & Townsend, P.C. and consultants to intervene in matters related to the electric utility rate case filings, representing GCCC members’ interests.
Current members include the following 44 cities: Alvin, Brazos Country, Brookshire, Bunker Hill Village, Clear Lake Shores, Deer Park, Dickinson, Fairchilds, Friendswood, Fulshear, Galveston, Hedwig Village, Hilshire Village, Hunters Creek, Iowa Colony, Jersey Village, Jones Creek, Kemah, La Marque, Lake Jackson, Manvel, Missouri City, Mont Belvieu, Morgan’s Point, Nassau Bay, Oyster Creek, Pattison, Piney Point Village, Pleak, Prairie View, Rosenberg, Santa Fe, Seabrook, Sealy, Simonton, South Houston, Spring Valley Village, Stafford, Sugar Land, Taylor Lake Village, Texas City, Tiki Island, Webster, and Weston Lakes.
The law provides that a rate request made by an electric utility cannot become effective until at least 35 days following the filing of the application to change rates. The law permits the City to suspend the rate change for 90 days after the date the rate change would otherwise be effective. If the City fails to take some action regarding the filing before the effective date, CenterPoint’s rate request is deemed approved.
The City of Texas City, Texas is a member of a coalition of political subdivisions in the Greater Houston area known as the Gulf Coast Coalition of Cities (“GCCC”). GCCC has been in existence since the early 1990s. The GCCC represents the interests of its members on gas and electric utility matters before the Public Utility Commission of Texas, the Railroad Commission of Texas, the Electric Reliability Council of Texas, and the courts. For the past 20 years, GCCC has protected the authority of municipalities over monopoly electric and natural gas providers and has defended the interests of the residential and small commercial customers within the cities. Cities are often the only consumer advocates that work to keep utility rates reasonable. The work undertaken by GCCC has saved ratepayers millions of dollars in unreasonable charges. GCCC has previously approved the hiring of Lloyd Gosselink Rochelle & Townsend, P.C. and consultants to intervene in matters related to the electric utility rate case filings, representing GCCC members’ interests.
Current members include the following 44 cities: Alvin, Brazos Country, Brookshire, Bunker Hill Village, Clear Lake Shores, Deer Park, Dickinson, Fairchilds, Friendswood, Fulshear, Galveston, Hedwig Village, Hilshire Village, Hunters Creek, Iowa Colony, Jersey Village, Jones Creek, Kemah, La Marque, Lake Jackson, Manvel, Missouri City, Mont Belvieu, Morgan’s Point, Nassau Bay, Oyster Creek, Pattison, Piney Point Village, Pleak, Prairie View, Rosenberg, Santa Fe, Seabrook, Sealy, Simonton, South Houston, Spring Valley Village, Stafford, Sugar Land, Taylor Lake Village, Texas City, Tiki Island, Webster, and Weston Lakes.
RECOMMENDATION
Staff recommends approval of the attached resolution suspending the rate change for 90 days. The resolution further authorizes the following by section:
Section 1. The City is authorized to suspend the rate change for 90 days after the date that the rate change would otherwise be effective for any legitimate purpose. Time to study and investigate the application is always a legitimate purpose. Please note that the resolution refers to the suspension period as “the maximum period allowed by law” rather than ending by a specific date. This is because the Company controls the effective date and can extend the deadline for final city action to increase the time that the City retains jurisdiction if necessary to reach settlement on the case. If the suspension period is not otherwise extended by the Company, the City must take final action on CenterPoint’s request to raise rates by April 10, 2024.
Section 2. This provision authorizes the City to participate in a coalition of cities served by CenterPoint, GCCC, in order to more efficiently represent the interests of the City and its citizens.
Section 3. The Company will reimburse the cities for their reasonable-rate case expenses. Legal counsel and consultants approved by GCCC cities will submit monthly invoices that will be forwarded to CenterPoint for reimbursement. No individual city incurs liability for payment of rate case expenses by adopting a suspension resolution.
Section 4. This section merely recites that the resolution was passed at a meeting that was open to the public and that the consideration of the Resolution was properly noticed.
Section 5. This section provides that both CenterPoint’s counsel and GCCC’s counsel will be notified of the City’s action by sending a copy of the approved and signed resolution to certain designated individuals.
Section 1. The City is authorized to suspend the rate change for 90 days after the date that the rate change would otherwise be effective for any legitimate purpose. Time to study and investigate the application is always a legitimate purpose. Please note that the resolution refers to the suspension period as “the maximum period allowed by law” rather than ending by a specific date. This is because the Company controls the effective date and can extend the deadline for final city action to increase the time that the City retains jurisdiction if necessary to reach settlement on the case. If the suspension period is not otherwise extended by the Company, the City must take final action on CenterPoint’s request to raise rates by April 10, 2024.
Section 2. This provision authorizes the City to participate in a coalition of cities served by CenterPoint, GCCC, in order to more efficiently represent the interests of the City and its citizens.
Section 3. The Company will reimburse the cities for their reasonable-rate case expenses. Legal counsel and consultants approved by GCCC cities will submit monthly invoices that will be forwarded to CenterPoint for reimbursement. No individual city incurs liability for payment of rate case expenses by adopting a suspension resolution.
Section 4. This section merely recites that the resolution was passed at a meeting that was open to the public and that the consideration of the Resolution was properly noticed.
Section 5. This section provides that both CenterPoint’s counsel and GCCC’s counsel will be notified of the City’s action by sending a copy of the approved and signed resolution to certain designated individuals.