CenterPoint Energy, Inc.'s has reached a settlement agreement with the Public Utility Commission of Texas staff and the City of Houston in its proceeding before the PUC to recover the costs the company incurred to restore service following Hurricane Ike, which struck the Houston area in 2008. All other parties to the proceeding have indicated that they will not oppose the settlement.
Under the settlement agreement, which is subject to approval by the PUC, CenterPoint Energy Houston Electric would recover approximately $663 million in storm recovery costs. In April, the company had filed an application pursuant to legislation adopted in Texas in 2009 in which CenterPoint Energy Houston Electric sought to recover approximately $678 million of such costs. The PUC is expected to consider the settlement agreement in August.
In July, CenterPoint Energy Houston Electric filed an application with the PUC for a financing order that would permit the company to issue low-cost securitization bonds to recover the distribution-related portion of the restoration costs. Of the $663 million agreed to in the settlement agreement, approximately $643 million is related to distribution. The exact size of the storm cost recovery bond offering will be determined by the PUC in a proceeding currently scheduled for hearing in September 2009. CenterPoint Energy Houston Electric hopes to complete the regulatory process and issue those bonds this fall.
CenterPoint Energy Houston Electric plans to seek recovery of the approximately $20 million of the storm restoration costs that are related to transmission service through the transmission cost of service process.