CenterPoint Energy, Inc.'s electric transmission and distribution subsidiary, CenterPoint Energy Houston Electric, LLC has filed an application with the Public Utility Commission of Texas (PUC) seeking an order to approve the reasonableness and necessity of the $677.8 million the company incurred to restore service to customers following Hurricane Ike. This amount consists of approximately $608 million in restoration costs, plus related regulatory expenses, and certain debt issuance and carrying costs.
The company also plans to file a request with the PUC to issue a Financing Order to securitize approved distribution-related restoration costs and to seek recovery of approved transmission-related costs through the Electric Reliability Council of Texas Transmission Cost of Service cost matrix.
This filing was made pursuant to Senate Bill 769, which was recently passed by the Texas Legislature and was signed by Governor Perry on April 16. This legislation provides for the PUC to determine the recoverable costs related to restoration of service following hurricanes and other natural disasters. SB 769 also authorizes the PUC to allow utilities to use securitization financing to recover costs related to such events in order to lower costs to consumers.