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CenterPoint Suggests Alternative of Setting Additional Discretionary Charges at Zero

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October 4, 2010

CenterPoint Energy does not believe that the disconnect and reconnect discretionary charges for customers with provisioned advanced meters should be reduced to zero prior to the reduction of other discretionary charges, as suggested by PUCT Staff and some REPs, but has alternatively suggested that all discretionary charges which will eventually be reduced to zero could be set at zero now to accommodate REPs' request for a $0 disconnect/reconnect charge for prepaid customers with advanced meters.

CenterPoint's suggestion came in rebuttal testimony in its rate case, PUCT Docket 38339.

As only reported in Matters, Direct Energy and TXU Energy have sought the $0 disconnect/reconnect charge for customers with advanced meters to make prepaid service to such customers economic (Only in Matters, 9/13/10).

However, in rebuttal testimony, CenterPoint said that, "[a]ll similar discretionary service rates should be equitable to all AMS related charges scheduled to be reduced to zero after full deployment of AMS meters."  CenterPoint noted that there are eight discretionary charges which will eventually be reduced to zero due to the deployment of advanced meters, including Move-In charges, out-of-cycle reads for purpose of a switch, and non-standard reconnects.

CenterPoint also opposed reducing charges for only those customers with prepaid service, as had been suggested, for both logistical and equitable reasons.

However, rather than just setting the disconnect/reconnect charges at zero, CenterPoint suggested that it could set all of the eight AMS-related discretionary charges to zero at this time instead of ratcheting them down annually over the deployment period, with corresponding costs moved to base rates.

CenterPoint said that the amount of expense that is currently recovered through the relevant discretionary charges is $9.4 million, which would remain in base rates under its alternative suggestion.

CenterPoint also reported that the costs to perform remote disconnection/reconnection of smart meters are not yet zero.  There is an administrative cost of $1.00 for processing discretionary service transactions, which the company is proposing to recover through base rates.

Also on rebuttal, CenterPoint opposed proposals from Staff and TXU Energy to waive demand ratchets for certain smaller customers with peak annual demand of less than the kVA equivalent of 20 kW of electricity in the prior twelve month period.  

"[R]atchets promote customer equity by more closely matching cost incurrence with cost recovery," CenterPoint said.

CenterPoint also opposed proposals to use unadjusted four-month coincident peak demand ("4CP") for allocation of transmission costs to retail customer classes rather than weather and year-end customer adjusted 4CP.  Furthermore, CenterPoint opposed using 15-minute interval data for transmission cost allocation rather than hourly data

   
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