Energy Choice
                            

Matters

Archive

Daily Email

 

 

 

About/Contact

Search

Texas Staff, Glacial Energy of Texas, Inc. Reach Settlement on Staff Petition to Revoke REP Certificate

June 26, 2013

Email This Story
Copyright 2010-13 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com

Staff of the Public Utility Commission of Texas and Glacial Energy of Texas, Inc. have reached a settlement to fully resolve a Staff Notice of Investigation into, and petition to revoke the REP certificate of, Glacial Energy of Texas, Inc., which allows Glacial Energy of Texas, Inc. to maintain its REP certificate.

In the proceeding, Staff was originally seeking, among other things, the revocation of the Glacial Energy of Texas, Inc. REP certificate based on allegations that Glacial Energy of Texas, Inc. failed to meet the requirements of P.U.C. SUBST. R. 25.107(g)(1)(D), which holds "[a]n individual that was a principal of a REP that experienced a mass transition of the REP's customers to POLR shall not be considered for purposes of satisfying this requirement, and shall not own more than 10% of a REP or directly or indirectly control a REP."

Staff had originally alleged that Gary Mole, the majority shareholder of Glacial Energy Holdings, which owns Glacial Energy of Texas, Inc. (Glacial Texas), previously had an ownership interest and experience with Franklin Power Company, a REP that experienced an involuntary mass transition of customers to POLR in 2005. See prior story for background

Under the settlement between Staff and Glacial Energy of Texas, Inc. filed June 25, "Gary Mole shall resign as an officer and director of Glacial Texas and agrees not to serve as an officer or director of Glacial Texas or otherwise participate in the management of Glacial Texas."

Story Continues Below...

ADVERTISEMENT
NEW Jobs on RetailEnergyJobs.com:
NEW! -- Project Analyst
NEW! -- Senior Analyst-Transaction/Data Management -- Retail Supplier -- Houston
NEW! -- Power and Natural Gas Scheduler -- Retail Provider -- Texas
Manager of Inside B2B Sales for Electricity Retailer
Manager/Director, Commercial & Industrial Sales -- Retail Supplier -- Houston
Electricity Program Director -- Retail Provider
Director of Inside B2B Sales -- Retail Supplier
Chief Regulatory Officer -- Retail Supplier
Operations Analyst -- Retail Provider -- Houston

The settlement notes that Gary Mole is currently the majority stockholder of Glacial Energy Holdings (hereafter, "Glacial Holdings"). Glacial Holdings owns 100% of the common stock of Glacial Texas, according to the settlement.

The settlement provides, "Gary Mole agrees to relinquish all control of Glacial Texas, through his interest in Glacial Holdings or otherwise. Glacial Texas shall amend its certificate of incorporation to, among other things, (i) designate all of the issued and outstanding shares of its capital stock as 'Class A Common Stock,' (ii) authorize a new class of stock which will be classified as 'Class B Common Stock,' and (iii) provide that the Class A Common Stock shall have no voting rights with respect to any matter for which a stockholder vote is required and the Class B Common Stock shall have sole voting power with respect to all matters for which a stockholder vote is required, including the election and removal of the directors of Glacial Texas. Class A Stock shall not provide any means of governance or control to the Class A stockholder."

Furthermore, per the settlement, "Glacial Texas shall issue one or more shares of Class B Common Stock to a newly formed entity ('Newco'), of which neither Glacial Holdings nor Gary Mole or any of his family members are an owner, officer, director manager or member."

Under the stipulation, "Within one week of forming 'Newco,' Glacial Texas shall file an affidavit verifying the following information: 1) Gary Mole has resigned as an officer and director of Glacial Texas and agrees not to serve as an officer or director of Glacial Texas or otherwise participate in the management of Glacial Texas in the future; 2) Glacial Texas has amended its certificate of incorporation to (i) designate all of the issued and outstanding shares of its capital stock as 'Class A Common Stock,' (ii) authorize a new class of stock which will be classified as 'Class B Common Stock,' and (iii) the Class A Common Stock shall have no voting rights with respect to any matter for which a stockholder vote is required and the Class B Common Stock shall have sole voting power with respect to all matters for which a stockholder vote is required, including the election and removal of the directors of Glacial Texas; and 3) Class A Stock provides no means of governance or control to the Class A stockholder."

The settlement is explicit that, "Glacial Texas shall retain its REP certification."

The settlement provides that the PUCT shall dismiss with prejudice all allegations against Glacial Energy of Texas, Inc., as set forth in Commission Staff's original Notice of Violation (NOV) and Petition. However, the stipulation states that, "Staff's current investigation of possible Commission rule violations under P.U.C. SUBST. R. 25.475(g)(2) and 25.480(d) are not included in Staff's NOV and will therefore not be dismissed pursuant to this agreement."

In addition to resolving the issue of Gary Mole's ownership, the settlement also provides various remedies to resolve Staff's allegations of additional violations.

Specifically, Glacial Energy of Texas, Inc. has agreed to pay an administrative penalty of $100,000 to settle all matters contained in the Staff NOV and petition, including Staff's allegations that Glacial Energy of Texas, Inc. was not full compliance with 35 provisions of the Substantive Rules (based on a compliance audit).

Additionally, under the settlement, Glacial Energy of Texas, Inc., agrees that it will not collect state sales tax on any customer payment for residential electric service. To the extent it has not already done so, Glacial Energy of Texas, Inc., agrees to refund to its customers all state sales taxes previously collected on any residential service by ERCOT.

Per the stipulation, Glacial Energy of Texas, Inc., shall establish and maintain a $1.5 million letter of credit for a two-year period following approval of the settlement. This letter of credit may be used to satisfy existing financial obligations necessary to maintain compliance with the Commission's REP certification requirements. According to the settlement, Glacial Energy of Texas, Inc., "warrants that the annual increased cost of the increased security will be approximately $100,000 annually at current rates."

Furthermore the stipulation provides that Glacial Energy of Texas, Inc., will consult with Commission Staff, "prior to the offer of any new products or services to the public for a period of two (2) years following the date of entry of the Commission order approving this Agreement."

The settlement specifically would conclude the investigation of Glacial Energy of Texas, Inc. for the alleged violation of Public Utility Regulatory Act (PURA) § 39.352 and former P.U.C. SUBST. R. 25.107(g)(9)(A), 25.107(g)(9)(B) and 25.107(j)(1), and current P.U.C. SUBST. R. 25.475, 25.479, 25,483, 25.107(g)(1)(D), and 25.107(j)(1), as set forth in Commission Staff's NOV and petition.

Additionally, as part of the stipulation, Glacial Energy of Texas, Inc. agrees to dismiss a pending lawsuit in state court which had sought, among other things, a finding that the PUCT was acting outside the scope of its authority in applying the 10% limitation rule under SUBST. R. 25.107(g)(1)(D) to Glacial Energy of Texas, Inc.

Docket: 40090

ADVERTISEMENT
NEW Jobs on RetailEnergyJobs.com:
NEW! -- Project Analyst
NEW! -- Senior Analyst-Transaction/Data Management -- Retail Supplier -- Houston
NEW! -- Power and Natural Gas Scheduler -- Retail Provider -- Texas
Manager of Inside B2B Sales for Electricity Retailer
Manager/Director, Commercial & Industrial Sales -- Retail Supplier -- Houston
Electricity Program Director -- Retail Provider
Director of Inside B2B Sales -- Retail Supplier
Chief Regulatory Officer -- Retail Supplier
Operations Analyst -- Retail Provider -- Houston

Search for more retail energy careers:
RetailEnergyJobs.com


Email This Story

HOME

Copyright 2010-13 Energy Choice Matters.  If you wish to share this story, please email or post the website link; unauthorized copying, retransmission, or republication prohibited.

 

Archive

Daily Email

 

 

 

About/Contact

Search