Energy Efficiency at the PUC

Energy efficiency was the topic of the day at the Public Utility Commission during a workshop held in Austin on June 30. The agency is considering changes to the state’s energy efficiency program, which requires transmission and distribution utilities to provide customers with incentives to be more energy efficient.

Here’s a bit of background on the issue: the state’s transmission and distribution utilities do not administer energy efficiency programs for free, but rather are permitted to recover the costs from ratepayers. Additionally, utilities that exceed their demand reduction goals are eligible to receive a bonus. The bonuses awarded to utilities can range anywhere from $5 million to $10 million.

Oncor, a transmission and distribution utility, offered a presentation on the estimated cost of meeting the proposed demand reduction goals. Frontier Associates and Good Company, both consulting firms, gave presentations on the benefits of meeting demand reduction goals and the cost effectiveness of Texas’ energy efficiency program. Representatives from the State Energy Conservation Office and the Texas Department of Housing and Community Affairs reported on federal money being spent within the state on energy efficiency measures, such as weatherization. Finally, the Retail Electric Provider Coalition offered a presentation on the potential cost impact of the proposed amendments to consumers.

Written comments have been previously filed in this project and can be found here. The Commission is expected to make a decision on the rules in July or early August.

 -- Eileen McPhee

New Report: Deregulated Generation Companies Profit During Recession

Electric deregulation was supposed to benefit consumers — that was the promise during the 1990s when several states adopted the market system. But according to a new report, some of the biggest winners last year were the major generation companies.

Released by the American Public Power Association, the May 2010 study finds that generation companies operating under deregulation in the Northeast earned healthy profits in 2009 — despite facing the nation’s worst economic crisis since the Great Depression.

The APPA report also concluded that generation companies under deregulation made much more money than generation companies still subject to regulation. Given the relatively high earnings, it's not surprising that deregulated generation companies oppose any return to regulation. One company warned that if “market deregulation is reversed or discontinued, our business prospects and financial condition could be materially adversely affected.”

Texas implemented electric retail competition in 2002 after authorizing electric deregulation in 1999. Since 2002, rates have remained consistently above the national average Prior to adoption of the deregulation law, rates in Texas were consistently below the national average. Rates in Texas also have increased by a far greater extent than they have in neighboring regulated states such as Louisiana and Oklahoma.

The APPA is a trade group associated with public electric companies such as municipally owned utilities. You can read the organization’s full report here.

CREZ Update: Lines could impact 12 counties

A transmission line project proposed just this week for the Amarillo area is already stirring controversy, according to a news story in the Amarillo Globe-News. Writer Kevin Welch  reports in the newspaper's June 17th edition on the application by Sharyland Utilities to build lines from southern Carson County to southeast Deaf Smith County.  The utility has proposed the route shown above, although that route could change as more landowners express their views at the Texas Public Utility Commission.

"In all the cases we've been involved in, in none of them have the commissioners chosen the preferred route," Lloyd Gosselink attorney Georgia Crump told the newspaper. "They're trying to weigh all the criteria. It's not a science, it's an art." Among Crump's clients is a property owner with lines passing north of Palo Duro Canyon State Park.

Sharyland's application was among three filed by utilities this week for major transmission projects. The lines included in the applications will transmit power from wind generators in West Texas and the Panhandle, and are associated with the state's Competitive Renewable Energy Zone program, or  "CREZ" for short.

The transmission lines proposed by Sharyland could impact property owners in Armstrong, Carson, Deaf Smith, Oldham, Potter and Randall counties. Separately, Oncor filed an application for lines that could impact landowners in Tarrant, Wise and Parker Counties. A third company filed an application for a transmission project near Abilene, with lines that could impact Kent, Dickens and Scurry counties.

With the filings this week, a procedural clock begins at the PUC under which the agency has 180 days to conduct hearings, consider testimony and render decisions.

Power Line Dispute in the Hill Country

A massive transmission line proposed for Central Texas is causing big headaches for the mayor of Kerrville, who fears it could harm his community's economic development.

Speaking to KENS Channel 5 in San Antonio, Mayor David Wampler said his community could lose a half billion dollars because of the line.

“The City of Kerrville has spent about $14 million in infrastructure improvements to bring utilities and roads to areas that would be affected by this line,” he said.

State Rep. Harvey Hilderbran also expressed concern. In letters written to the Public Utility Commission and the Lower Colorado River Authority, Hilderbran called for a change in the proposed route. “We want that line to move away from the Kerrville corridor,” he said.

The PUC already has given the green-light to several transmission projects associated with so-called "Competitive Renewable Energy Zones." The CREZ lines will criss-cross West Texas, the Panhandle and Central Texas -- and potentially harm scenic views and lower property values along the way.

It's possible for affected landowners to block individual routes, but only if they intervene in a complicated legal process at the Public Utility Commission. More information about CREZ and the proposed transmission lines can be found at the PUC website.

Proposed PUC Rules Draw Fire

Unfair and anticompetitive. That’s how some members of the public and consumer advocates have characterized proposed rules that would keep Texans from getting electric service if they owe an outstanding balance to a previous electric provider.

These complaints and others were aired during a May 17th public hearing in Austin regarding proposed changes to the Public Utility Commission’s rules for electricity service disconnections. The changes would modify eligibility requirements for deferred payment plans and other low-income customer protections. They also modify the disconnection notice requirements as they pertain to customers with life-threatening medical conditions. Finally, the proposed rules contain the controversial switch-hold provisions intended to keep customers from changing retail providers without first paying any balance they owe to their previous provider.

Various groups offered comments on the proposed rules. Some participants requested removal of language that would prevent customers with battery backups for medical devices from qualifying for special protection. Participants also said that seriously ill and disabled customers should never face disconnections. Participants overwhelmingly weighed in against the switch-hold portion of the proposed rules.

Various parties also filed written comments, which can be found here and here. Additional comments are due Friday, May 21.

-- Eileen McPhee

Electric Disconnection Rules Pending at PUC

On April 16, the Public Utility Commission proposed amendments to its electric service disconnection rules. The amendments would modify the eligibility requirements for deferred payment plans and other low-income customer protections. The amendments also modify the disconnection notice requirements as they pertain to customers with life-threatening medical conditions. Finally, the amendments contain a proposed switch-hold rule intended to prevent customers from changing retail providers without first paying any balance they owe to their previous provider.

The proposed amendments, drafted by Commission staff, are part of an ongoing effort by the agency to clarify various billing issues that are important both to retail electric providers and consumers. The Commission is accepting public comments on the proposed amendments, although comments must be submitted by May 6. Interested parties can also submit replies to those comments by May 21. The agency’s three Commissioners are expected to adopt a final version of the rules sometime early this summer.

To read the proposed amendments, click here.

--Eileen McPhee

Regulatory experts needed for Afghanistan, Iraq

Never thought your knowledge of tariff methodologies and docketing systems would lead to exciting adventure? Think again.

In an email blast to American utility officials and consultants, the National Association of Regulatory Commissioners signals that the war-torn countries of Afghanistan and Iraq need help establishing electric regulatory agencies. Explains Erin Skootsky, director of NARUC's international programs: "Afghanistan is planning to create a regulatory agency, pending passage of legislation (and) Iraq plans to create a Department of Regulation at the Ministry of Electricity following passage of an electricity regulatory law.”

Skootsky notes that her organization “has been approached” about potentially assisting with in-country technical training programs and workshops. She said the training would be short-term — one week for NARUC member volunteers and 1-3 weeks for consultants — and focused on the foundations of regulation, management of a regulatory agency, tariff methodologies, licensing issues, docketing systems and consumer protection. There’s no indication from Ms. Skootsky’s email about which government or organization, specifically, solicited NARUC’s assistance.

Other details? According to preliminary security information cited by Ms. Skootsky, participants would be lodged at United States government facilities or guest houses and not in independent hotels. "Project security would inspect all locations prior to meetings and provide local ground transportation," writes Ms. Skootsky, adding that "country clearance and other security arrangements will be quite extensive."

For those interested, replies should be sent to Ms. Skootsky by April 12, 2010. Her email address is eskootsky@naruc.org.

-- R.A. Dyer