The Public Utility Commission met on April 21 to review process flow diagram applications (PFDS), advanced metering system applications (AMS), and to review the commissioner’s memos with proposed RFP changes to ERCOT. A link to the archived meeting can be found here and the agenda can be found here.
This report is intended to give you an overview and highlight of the discussions on the various topics taken up. It is not a verbatim transcript of the discussions but is based upon what was audible or understandable to the observer and the desire to get details out as quickly as possible with few errors or omissions.
Agenda items 6-11, 28, 31, 34, and 35 were consented to and items 12-14, 16-19, 21-25, 37, 38, 40, 41, 44, and 45 were not discussed
Item 1: Public comment for matters not specifically posted on this agenda.
Deborah Fatou, Self
- Disappointed in the rate payer charge, deposit issue, and service fee with water services
- Met with the legislature to talk about the wrongs being done to rate payers; PUC is not enforcing rules and protecting the people like it promises
Item 2: Docket No. 51480; SOAH Docket No. 473-21-1201 – Application of El Paso Electric Company to Amend Its Certificate of Convenience and Necessity for the Seabeck-to-San Felipe 115-kV Transmission Line in El Paso County. (Final Order) John Kelly
- Staff – PFD filed in March and staff filed a memo with proposed changes to the PFD
- McAdams – Unique because the application deals with a remote area, heavy parks and wildlife, and archeological sites emphasis
- PFD on route 1 weighs heavily on these facts; it costs more but has a bigger community impact
- All commissioners agree on line 1 because of the protection of parks and wildlife; the line needs to be built
- Motion to pass with amendments, motion passes
Item 3: Docket No. 52040; SOAH Docket No. 473-21-2607 – Application of El Paso Electric Company for Advanced Metering System (AMS) Deployment Plan, AMS Surcharge, and Non-Standard Metering Service Fees. (Final Order) Grace Lager
- Staff – Ordered in March and a correction memo was filed in April
- Lake – Lots of issues in this order
- McAdams – This proceeding centers around 13 core questions for me; should the commission approve the AMS and I believe we should not
- Should grant a good cause exception because it is a waste of time to test the meters
- Cobos – We are still 6 years out from development, so I am hesitant but not objecting
- McAdams – AMS was passes with the intention of efficiency and transparency; the waiver request for non-submittal of geographic breakdown which violates the intention
- Cobos – Agreed; if they can’t break it down geographically, it is not planned enough
- McAdams – Deny waiver to not follow monthly progress reports; commission will not know of delays and reports are required by rule
- Commission agrees this waiver should not be granted
- Remote disconnection waiver should be granted for efficiency; commission agrees
- Cobos – Should not grant the waiver for a third-party tech server; commission agrees
- McAdams – Should grant base fees in place of rate case when initially established; commission agrees
- El Paso has not submitted portal process and has failed to comply with web access requirements
- Commission is not waiving any data requirements
- Final remedy to be considered; don’t want utility to go back to square 1 when establishing these things
- Suggest the commission allow the party to revise the application point by point in direction of remedy of commission concern; think they should look at similar proceeding and reflect good behavior that is appropriate to their field
- Cobos – We have not granted a majority of the waivers; are we now asking the staff to address the rule requirements and if it is happening too quicky it might make more sense to apply later and withdrawal completely right now
- Lake – We all want this done but want to ensure it is done right for rate payers
- McAdams – I think we give them 3 months and if not completed they can pull the application, or we can deny it
- Motion for staff to make recommendations based on commission conversation and give El Paso 3 months to present changes; motion passes
Item 4: Docket No. 52389 – Southwestern Electric Power Company’s Request for Approval of Advanced Metering System (AMS) Deployment Plan, AMS Surcharge and Non-Standard Metering Service Fees. (Final Order) Grace Lager
- Staff – Proposed order and corrections were filed, memo from staff
- Lake – Substantially more thorough than last AMS case; still think there are some deficiencies
- Cobos – Should not grant waiver for web portal exceptions because they have not filed any proof of technical or financial challenges
- Should grant a waiver for remote disconnection ability and for base pay instead of rate
- Recommend approval of application without the waivers we denied; grant three months turnaround time
- Motion for staff to make recommendations based on commission conversation and give El Paso 3 months to present changes; motion passes
Item 5: Docket No. 52715 – Application of Denton Municipal Electric to Change Rates for Wholesale Transmission Service. (Appeal of Order No. 4) Alex Scheifler
- Staff – Appeal of order number 4
- McAdams – A question of sufficiency vs. merits; would like to ask staff what our interest in rate information is
- Staff – A utility that provides information up front will serve our transparency and consistency interest
- McAdams – What do we need in a depreciation study?
- Staff – Have not done these studies myself; Denton has not had a comprehensive rate case in 20 years
- McAdams – We have to sign off on their wholesale rates; staff has an obligation to gather as much information beforehand as possible
- Cobos – Rate package review is required, and a depreciation study is an essential part of this review; I do think the language we have is ambiguous on if it is required or not
- Lake – We can discuss the depreciation study language later; let’s minimize to a conversation about Denton today
- Glotfelty – Has been years since we have seen a solid rate review from Denton; think we need an updated review
- Motion to deny and request depreciation study, motion passes
Item 15: Project No. 52373 – Review of Wholesale Electric Market Design. (Discussion and possible action)
- Link to memo by Commissioner Will McAdams
- Link to memo by Commissioner Lori Cobos
- McAdams – My memo is a cry for help; our office has been trying to crack the grids code on resiliency and reliability.
- Would like for the greater industry to have input; too big of an issue for staff to take on alone
- Staff – Would you also like reply comments?
- McAdams – Just first line of questions as of right now
- Cobos – EROCT plans to publish RFP on August 1st; my memo lays out my thoughts and plans for how ERCOT can accomplish this
- Reorganized questions; issue first RFP with dual capability generators
- ERCOT said they need more time to work with pipeline companies
- McAdams – Expressed a phased approach to the firm fuel product and process; I agree with phase I in completion of SB 3
- Glotfelty – Not a gas space expert; coal piles provide firm fuel
- I struggle to pay for something we have no price transparency into; concerned with price transparency of offsite storage and transportation in phase II
- Cobos – Purpose of my memo was to be a slight framework; I would be open to letting some coal things play out
- However, I have seen the price of coal is going up and there are certain bans on their transportations; don’t want to pay more to store it
- McAdams – No administrative agency is going to be able to keep up with gas and oil prices
- Lake – Everyone is interested in looking into coal for Phase II; strongly agree with 1st RFP and broadly agree with 2nd RFP but think storage should be emphasized
- Important for this commission to commit to finishing off site storage for fuel so we know how we can start preparing for winter; pipeline companies will adjust business models to meet the requirements we set
- Cobos – We need to encourage resiliency arrangements with generation and gas line companies in place by regulatory frameworks
- Lake – As we give ERCOT direction on the first RFP we should ask for them to begin solidifying contracts and affidavits for generation storage
- Prepare for summer to be the first update on RFP for firm and transportation deals and thoughts
- Glotfelty – Would also like ERCOT to give thoughts on cost transparency to coal
- Cobos – Placed quantity to 4,000-5,000 MW to allow for competition but I am open to discussion
- McAdams – Where we land on pricing and megawatt budget are major drivers; I did think an as-is bid approach would be easiest, but the IMM had thoughts on a combination that could help mitigate the danger of an upward skew of prices
- Lake – Could you give thoughts on RFP 1 only with the requirements, market concentration and tradeoffs between limiting MW and a programed price gap?
- IMM Staff – Think ideal would be a slope demand curve but with the first RFP we have too little time; I would say a budget cap of total dollars
- I would recommend a lower budget cap and allow the MW cap flow with the offers
- Lake – Worst case-scenario is all offers are high cap, correct?
- IMM Staff – I think this bid is a seasonal daily capacity service
- Lake – How do we eliminate the chance that we have no MW reserved or that we deplete our budget over purchasing MW
- Cobos – We need MW for winterization plan
- IMM Staff – We could also propose a budget cap with a range of MW that ensure MW in reserves; the suppliers will be motivated to get the most MW for profit
- Lake – Want to ensure there is 0 probability of high-priced MW or no MW in reserved
- IMM Staff – It would be very difficult to anticipate an exact budget that would eliminate all probabilities
- Cobos – These generators can participate in real time markets; if they do not participate, they will get RUC for reliability
- Companies have invested money in dual capabilities and reserves because they want to be able to run; I would like to take more time to think about the interplay of budget cap and price cap
- Would it be possible for IMM to file recommendations and the commission will have more time to analyze and visit with stakeholders?
- McAdams – We have to be complete with this by May 12th according to ERCOT
- Lake – Last recommendation I heard was a budget cap and minimum MW range; is this the best option
- IMM Staff – Yes; just cannot reserve so many MW that the market cannot be competitive
- Cobos – My concern is that we have to put a product this winter; there is a lot of footwork that needs to happen, and we need these reservoirs
- Glotfelty – I like IMM’s idea; I would like to think not every company will bid $5,000
- Lake – Just want to ensure that we are not bidding millions of ratepayer dollars on this market
- Think Cobos’ idea of taking time to review is a good idea
- Cobos – Could IMM also brainstorm some regulatory safeguards to avoid risks
- Lake – Anything else we need to include in the IMM analysis
- Cobos – I think the initial contract term for IPP should be one year; subsequent RFPs should be multi-year
- Lake – Agreed; also look at the coal contract terms
- Cobos – I think single clearing price is more administratively efficient than pay as bid which could be choppier
- McAdams – It depends on what method is adopted but there will be impact to consumers regardless; however, it is more limited than other ancillary services
- McAdams – “I would suggest … that we consider asking ERCOT, as they deliberate, when they report back the potential financial impact to the system, before we execute, that we consider a plan to authorize the pass-through of a firm fuel program cost under 16 TAC 25.475(b)(5), which is an authorized pass-through amount occurring from an out-of-market action that this Commission authorizes. We specifically allowed that in [the fixed- price rule] for the very scenario of the firm fuel program because we knew that was coming, we knew we were going to have to build this in for resiliency purposes.”
Item 20: Project No. 53191 – Reorganization of 25.505. (Proposal for Adoption) David Smeltzer and Ben Haguewood
- McAdams – Memo was designed to elicit an order of work prioritization; appreciate staff help
- Motion to approve proposal for adoption, motion passes
Item 26: Docket No. 48697; SOAH Docket No. 473-20-1117.WS – Application of Anderson Water Company, Inc. for Authority to Change Rates. (Final Order) Alex Scheifler
- Staff – Staff has a memo on the proposed order
- Lake – Appreciate staff work with a small utility application; order looks pretty good
- McAdams – Tap fee increase from $300-$1200; do not think they filed sufficient reason for increased cost
- Cobos – Tap fee stood out to me too; I understand it is hard for small area to get information, but I want to be consistent and get additional information for the tap fee
- However, given they are a small county we should just approve as it is consistent with what we have been approving
- McAdams – Anderson was not permitted to collect the funds of the water tap fee before they started billing and I believe there should be a refund dollar for dollar for overbilling
- Staff – Compliance docket will be formed
- Move to approve proposed with good clause exception on notice, motion passes
Item 27: Docket No. 48836; SOAH Docket No. 473-19-1422.WS – Petition of Paloma Lake Municipal Utility District No. 1, Paloma Lake Municipal Utility District No. 2, Vista Oaks Municipal Utility District, Williamson County Municipal Utility District No. 10, and Williamson County Municipal Utility District No. 11 Appealing the Wholesale Water and Wastewater Rates Imposed by the City of Round Rock. (Order on Interim Appeal) Ariadna Garcia
- Cobos – I would grant the parties appeal of Round Rock and provide a ruling on each issue so staff could draft an order
- Cobos runs through 7 questions and answers relating to the municipal district rates; commission agrees
- Motion to approve proposal of Round Rock in part, motion passes
Item 29: Docket No. 50721; SOAH Docket No. 473-21-0946.WS – Application of Crystal Clear Water, Inc. for Authority to Change Rates. (Final Order) David Hrncir
- Staff – Judge made corrections to the order
- Glotfelty – Highlights affiliate problems that have not been addresses
- We should remand this and show others that with affiliate relations company must qualify to a higher standard
- McAdams – On remand, staff should explore safeguard agreements for affiliates, and ask staff to take a look at the notice in this rate case and future cases
- OPUC received late notice to respond; would like them to be appropriately notified next time
- This utility files two water systems in the last year, if utility purchases another water system without rate solidification, commission will appropriately remand
- Commission agrees on a remand
- Cobos – Need to have affiliate loan off the books
- Motion to remand and address issues addressed in discussion, motion passes
Item 30: Docket No. 51973 – Petition of Rodney Earl Mohnke, Stephen Lee Mohnke, Melvin Max Mohnke, Kenneth Wayne Mohnke, Kathleen Ann Mohnke-Blakely, and Mel Mohnke, Trustee of the Mohnke Living Trust Dated December 7, 1996, to Amend H-M-W Special Utility District’s Certificate of Convenience and Necessity in Harris County by Expedited Release. (Order on Motion to Extend Time to File a Motion for Rehearing) Cheri Hasz
- Staff – Motion for extension to file for rehearing
- Motion to deny motion, motion passes
Item 32: Docket No. 52515 – Petition of Belknap, FP, LTD. to Amend Marilee Special Utility District’s Certificate of Convenience and Necessity in Collin County by Expedited Release. (Final Order) Cheri Hasz
- Staff – No exceptions were filed
- Lake – Petitioners do not own property; modify PFD to deny
- Motion to deny, motion passes
Item 33: Docket No. 52529 – Petition of East Tioga 581 LP to Amend Marilee Special Utility District’s Certificate of Convenience and Necessity in Grayson County by Expedited Release. (Final Order) Margaux Fox
- Lake – Straight forward
- Move to deny the PFD, motion passes
Item 36: Project No. 52405 – Review of Certain Water Customer Protection Rules. (Proposal for Publication). David Smeltzer and Celia Eaves
- Staff – Staff and Lake filed a memo
- Lake – Filed a memo to add section to explain to consumers their rights
- Motion to approve with inclusion of Lake memo, motion passes
Item 42: Project No. 53157 – Agency Report to the 88th Legislature. (Discussion and Possible Action) David Smeltzer
- Staff – Staff filed report to commission for review
- Lake – Appreciate the work that staff has and continues to pour into this; want to offer thoughts for staff to consider
- We have implemented SB 2 and SB 3 tirelessly; want to highlight that for the legislature and the results
- Don’t think we have to discuss electric vehicles to save space in report
- McAdams – Want to discuss reforms we have made to implement these changes; these reforms are complicated but hopeful we can find a way to highlight process and progress
Item 43: Discussion and possible action regarding agency review by Sunset Advisory Commission, operating budget, strategic plan, appropriations request, project assignments, correspondence, staff reports, agency administrative issues, agency organization, fiscal matters, and personnel policy.
- Executive Director – Electric Supply Chain Map Committee will be reviewed this week
- Committee will meet publicly during the middle of May to help improve operations of emergency events
Item 46: Adjournment for closed session.
- Motion to approve 225k Executive Director salary passes
