Texas PUC Staff Says ERCOT Securitization Charges, Which May Vary By Month, Are Not "Pass Through" Charges, And Are Instead Recurring Charges (REP's Fixed Rate Cannot Be Changed), Seeks PUC Confirmation
Also Seeks Guidance That Securitization Charge Opt-Outs Are Not Transferable
August 28, 2023 Email This Story Copyright 2010-23 EnergyChoiceMatters.com
Reporting by Paul Ring • email@example.com
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Staff of the Texas PUC requested guidance from the Commission regarding two issues that relate to the implementation of the ERCOT Debt Obligation Order that was filed on October 13, 2021 in Docket No. 52322 (the uplift financing program for certain Uri costs)
Specifically, Commission Staff seeks confirmation from the Commission that: (1) ERCOT Securitization Charges are not a pass-through charges, and (2) Opt-outs under Public Utility Regulatory Act (PURA) § 39.653(d) are not transferable
Staff said that, "It is Commission Staff’s understanding that Securitization Uplift Charges and Securitization Default Charges (collectively, Securitization Charges) meet the definition of a 'recurring charge' under 16 TAC 25.475(b)(9) because they are 'expected to appear on a customer’s bill in every billing period or appear in three or more billing periods in a twelve month period.'"
"Moreover, they are not billed by a transmission and distribution utility (TDU) and they are not associated with enrollment or a request for a specific service," Staff said
"Therefore, in accordance with 16 TAC § 25.475(b)(5), the price of 'fixed rate product' may not vary to accommodate changes in the amount of Securitization Charges," Staff said
"Commission Staff understands that the amount of the Securitization Charges may vary from month-to-month, but the definition of 'recurring charge' is not limited to charges that do not vary on a monthly basis," Staff said
Staff stressed that, "Commission Staff’s understanding relates only to fixed rate products that were subject to Securitization Charges at the beginning of their contract term. Commission Staff is not expressing an opinion regarding whether it was permissible to vary the price of an existing fixed rate products on account of Securitization Charges, or the appropriate manner of doing so, if permissible."
Concerning the opt-out of Securitization Charges, Staff said, "It is Commission Staff’s understanding that Securitization Opt-Outs with respect to transmission-voltage customers are specific to the customers and their ESI IDs at the time of submission of the Opt-Out Notice."
"Accordingly, if a transmission-voltage Customer that is Securitization Uplift Charge Opt-Out Entity1 transfers a facility to another entity, this new entity would not be entitled to any opt-out that might be associated with this facility’s ESI ID," Staff said
"Upon notification of a facility transfer, Commission Staff anticipates that ERCOT will remove the associated ESI IDs from the list maintained pursuant to ERCOT Nodal Protocol § 27.3(4)," Staff said
"Similarly, if a transmission-voltage Customer that is a Securitization Uplift Charge Opt-Out Entity acquires a new facility, the customer’s existing opt-out would not extend to this new facility and its ESI IDs," Staff said
"Note that Commission Staff does not contend that facility transfers are the only type of transaction that might result in a loss opt-out status, and expresses no opinion regarding the effect, if any, of other types of transactions, which will be evaluated on a case-by-case basis," Staff said