Texas PUC Staff File Petition To Revoke Retail Electric Provider Certificate Of REP That Is Currently Providing Service To Customers

June 17, 2019

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Copyright 2010-19 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com

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Staff of the Public Utility Commission of Texas ("Staff") have filed a petition to revoke the retail electric provider (REP) certificate of Axon Power & Gas, LLC, alleging that the REP, "has engaged in a pattern of making delinquent payments and repeatedly defaulting on past-due payments to TDUs for several years[.]"

Staff said in the petition that, as of the filing of the petition (June 17), Axon Power & Gas continues to provide retail electric service to customers.

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In the petition, Staff alleged, "Based on information provided to Commission Staff by Axon and various transmission and distribution utilities (TDUs), Commission Staff believes that Axon is currently in default under the terms of its tariffs for retail electric delivery service (Tariff) with at least one TDU in the ERCOT Market, and is currently delinquent in remitting payment to multiple TDUs."

In the petition, Staff alleged, "Commission Staff also believes that Axon has recently been in default with, and delinquent in making payments to, as many as four TDUs in the ERCOT Market."

In the petition, Staff alleged, "Based primarily on information provided by TDUs, Commission Staff believes that Axon has engaged in a pattern of making delinquent payments and repeatedly defaulting on past-due payments to TDUs for several years, ranging back to 2014 when Axon was certificated as a REP."

In the petition, Staff alleged, "Axon's default and delinquency relates to the following sections of the Tariff. Section 4.4.5 of the Tariff, related to remittance of invoiced charges, states that '[p]ayments for all Delivery Charges invoiced to Competitive Retailer shall be due 35 calendar days after the date of Company's transmittal of a Valid Invoice.' Section 4.4.6, related to delinquent payments, states that '[p]ayments for Delivery Charges invoiced to Competitive Retailer shall be considered delinquent if not received by 5:00 p.m. CPT of the due date stated on the Valid Invoice' and that a default occurs 'after a ten calendar day grace period has passed without the Competitive Retailer fully paying the delinquent balance.'

Staff said that Section 4.6.1 states that: "A Competitive Retailer shall be considered to be in default under [the] Tariff if the Competitive Retailer: (1) Fails to remit payment to the Company as set forth in Section 4.4.6, DELINQUENT PAYMENTS; (2) Fails to satisfy any material obligation under this Tariff, including failure to fulfill the security requirements set forth in Section 4.5, SECURITY DEPOSITS AND CREDITWORTHINESS; or (3) Is no longer certified as a Retail Electric Provider."

In the petition, Staff alleged, "Commission Staff has been informed that as of the filing of this Petition, this default has not been cured and that it caused significant financial harm to TDUs."

In the petition, Staff alleged, "Axon's default and delinquency under the terms of the Tariff violates 16 TAC §§ 25.107(j)(7), 25.107(j)(16), and 25.214(d). This default and delinquency caused significant financial harm to TDUs. Accordingly, Commission Staff has initiated the instant petition to (1) revoke the REP certificate held by Axon; (2) identify claims against the financial resources relied upon by Axon in obtaining its REP certificate; and (3) proceed against any financial resources that Axon relied on to obtain its REP certification pursuant to 16 TAC § 25.107(f) and (i)(7)."

In the petition, Staff alleged, "The Commission should revoke the REP certificate of Axon because Axon committed significant violations of PURA and Commission rules, and no longer has the capability to provide continuous and reliable electric service to its customers."

Staff said that 16 TAC §§ 25.107(j)(1)-(19) define "significant violations" that may result in the revocation of a REP certificate.

In the petition (citing the numbered provisions of 16 TAC §§ 25.107(j)), Staff alleged, "Among the significant violations enumerated, Axon has committed the following: (7) Bankruptcy, insolvency, or the inability to meet financial obligations on a reasonable and timely basis; (16) Failure to timely remit payment for invoiced charges to a transmission and distribution utility pursuant to the terms of the statewide standardized tariff adopted by the Commission."

In the petition, Staff requested that the Commission revoke Axon's REP certificate, and if available, proceed against any financial resources that Axon relied on to obtain its REP certification pursuant to 16 TAC §§ 25.107(f) and (i)(7).

Axon may request a hearing to contest the allegations contained in the petition within 30 days of receipt of Staff's petition.

Docket 49634

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