Texas PUC Commissioners Weigh Interaction of Oncor Change-in-Control Case on Upcoming Sharyland Rate Case Filing (Anderson Notes Current "Scale" of Sharyland A Major Driver of Rate Challenges)

In discussing when it would be appropriate to require Sharyland Utilities to file a rate case during yesterday's open meeting, Texas Public Utility Commissioners mused whether the Oncor change-in-control proceeding should impact such timing.

Various affiliates of Sharyland have sought to purchase Oncor in the change-in-control case pending before the PUCT. The PUCT has 180 days to rule on the petition (creating a deadline of approximately March 27, 2016).

Under a prior stipulation, Sharyland Utilities is required to file a rate case by July 1, 2016. That stipulation further requires use of a 2015 test year. It would also require system-wide rates for all of Sharyland's service areas (Sharyland Utilities/Cap Rock and Sharyland McAllen)

Due to customer complaints which have exposed issues with the current rate allocations at Sharyland, Commissioner Brandy Marty Marquez said that it would be beneficial that Sharyland be required to file its rate case as soon as practicable, suggesting that requiring the company to file the case by April 30, 2016 may be feasible, as the company has already said that a deadline of May 31, 2016 was reasonable, according to Marty Marquez

In response, Chairman Donna Nelson said, "I'm just thinking of the other pending case that we have, and how that ... how the timing of that intersects," in reference to the Oncor change-in-control proceeding

While Commissioners were guarded in discussing how precisely they view the interplay between the two cases, Commissioner Kenneth Anderson said that he was also, "mulling that over in the back of my mind."

Anderson continued, "it's probably occurred to all of us: there's several ways to skin this problem [Sharyland rates] ... but the real problem that we face is the scale of Sharyland," noting that there are several potential solutions.

While none of the Commissioners were explicit, the implication was the leveraging, in some form, of any potential Oncor-Sharyland affiliate relationship to reduce Sharyland rates. While no specifics were proffered, we observe that such leveraging could potentially range from shared assets and services, or, in a larger move, the consolidation of the Sharyland service areas into Oncor under a single tariff, as previously observed by RetailEnergyX.com in 2014

Marty Marquez hoped that if an April 30, 2016 rate filing deadline were adopted, it would allow for new rates to be in place by the winter of 2016-17, but Anderson raised doubts about whether that goal could be realized absent a settlement in the case