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Lubbock Mayor States Intent For Lubbock Power & Light To Implement Retail Choice As Part Of Joining ERCOT

LP&L, Texas' 3rd Largest Municipal Utility, Supports Move To Retail Electric Choice

January 2, 2017

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Copyright 2010-17
Reporting by Paul Ring •

In testimony filed with the Public Utility Commission of Texas concerning Lubbock Power & Light's sought transition from the Southwest Power Pool to ERCOT, Daniel Pope, Mayor of the City of Lubbock, stated an, "intent to pursue retail customer choice for City of Lubbock ('Lubbock') electric customers served by Lubbock Power & Light."

Pope was testifying on behalf of LP&L, and another witness for LP&L said that the utility supports the expression of the mayor's intent

LP&L, the third largest municipal electric utility in Texas, serves over 104,000 electric meters in the Lubbock area. It is seeking to have 470 MW of its total load of approximately 600 MW join ERCOT effective June 1, 2021. LP&L acquired distribution facilities serving approximately 170 MW in Lubbock from SPS in 2010. LP&L's partial requirements contract with SPS related to that 170 MW of load expires in 2044 and is not addressed by the proposed ERCOT transition.

To date, no municipal utility in Texas has elected to offer retail choice (a cooperative, Nueces Electric Cooperative, is the only opt-in entity).

"One of the most common requests that I receive from the citizens of Lubbock is to bring back competition for retail electric service [prior competition allowed customers to choose their distribution provider: SPS or LP&L]. As Mayor of Lubbock, it is my responsibility to be responsive to the needs of our citizens. Personally, I believe in the principles of competition, and there is no question in my mind that the citizens of Lubbock desire to be given the right to freely shop the Texas retail electric market for a provider who can tailor a product that best suits their needs. I believe LP&L ratepayers deserve the same opportunities to have choices for retail electric service that are enjoyed by the majority of Texans," Pope testified

"In addition, as Mayor I have a duty to pursue economic development opportunities for Lubbock. As I visit with commercial and industrial prospects about locating their facilities in Lubbock, I receive many questions about the status of electric service in Lubbock. It has become apparent to me through these meetings with prospects that competitive retail electric service is an important and determining factor in siting decisions for many businesses," Pope testified

Pope testified that once a, "fair and reasonable pathway," for LP&L to join ERCOT has been established and approved by the PUCT, "a comprehensive study will need to be conducted expeditiously to develop a transition plan that will allow Lubbock to opt-into the competitive retail market at the earliest practicable date."

"Lubbock is uniquely situated at this point in time to undergo the process of opting-in to the competitive market. However, this process is not without its challenges. While I can speak to our ultimate desire to make this move, we must first carefully analyze how to responsibly make this transition so that our citizens are not harmed in the process," Pope said

"At the next meeting of the Lubbock City Council that is scheduled to occur on January 11, 2018, I will request City Council discussion of this plan. In addition, I will ask for City Council consideration of a resolution that will memorialize Lubbock's intent to carefully research the best way to transition our citizens to the retail electric market upon Commission approval of our entry to the ERCOT market," Pope said

LP&L also presented rebuttal testimony from David McCalla, Director of Electric Utilities of LP&L.

"I fully support the Mayor's expression of intent, and I support his desire to allow Lubbock customers to have access to the ERCOT competitive retail market," McCalla said

McCalla noted that, as several witnesses have testified, establishment of a NOIE (Non-opt-in Entity) Load Zone, as originally proposed, would delay Lubbock' s ability to opt-in to the competitive retail market. "To eliminate delay in achieving opt-in status, LP&L now withdraws its request for the establishment of a NOIE Load Zone," McCalla said

McCalla further testified that, "LP&L has no other option available than ERCOT to provide retail choice for Lubbock electric customers. Retail competition is simply not available and may never be available in SPP."

"LP&L Staff fully supports the Mayor's expression of intent, because it is our belief that this is the best possible outcome to provide a better future for Lubbock's electric customers. It is apparent from the testimony that this option does not exist in SPP. If the Commission determines that LP&L's proposed transition to ERCOT is not in the public interest, then approximately 176,000 citizens of Lubbock will not have an opportunity to participate in ERCOT's competitive retail market," McCalla testified

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