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City Council Of Lubbock, Texas Approves Resolution To Implement Retail Electric Choice At Lubbock Power & Light
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The City Council of Lubbock, Texas formally adopted a resolution providing that, "retail electric customer choice shall be initiated [for city utility Lubbock Power & Light] on the completion of
all conditions provided herein." (such conditions are noted below)
With city council approval for electric choice now granted, subject to the largely customary conditions listed below, LP&L hopes to transition to competitive retail electric service in late 2023.
The late 2023 implementation date reflects the fact that part of LP&L's system remains in SPP. LP&L hopes to migrate the remaining 30% of the system (about 24,000 customers) to ERCOT in summer 2023
LP&L's adoption of choice will mark the first time a municipally owned utility voluntarily adopted a competitive retail market since Texas Senate Bill 7 first became law in 1999.
As previously reported, LP&L under retail choice would not serve as the "default retail provider", which LP&L describes as a stopgap energy provider who supplies electricity if a customer does not choose a retail provider or if a customer's retail provider goes out of business (e.g. POLR). LP&L is to conduct an RFP to select a default provider(s).
Discussion of LP&L's draft transition plan contemplates customers being provided an opportunity to select their REP prior to the start of choice to avoid being assigned to a default REP, similar to the implementation of choice at Sharyland.
LP&L will continue to serve as the sole provider of metering services, but, consistent with the Texas retail market, LP&L will not bill customers, and will instead bill REPs for delivery service provided to REPs.
Specifically, under the adopted council resolution, customer choice will commence when the following
conditions have been met, and the council's irrevocable resolution is expressly subject to
the occurrence of all of the following conditions:
(1) LP&L's Total Load has been fully integrated into ERCOT for a minimum
period of sixty (60) days.
(2) ERCOT and/or the Public Utility Commission of Texas, or any other
applicable regulatory body, approves the initiation of customer choice for
LP&L and its customers, to the extent necessary or required.
(3) The Electric Utility Board and the City Council of the City of Lubbock have
established the procedures and criteria, if desired, for selecting the Provider
of Last Resort ("POLR") for customers within LP&L's certificated service
area as of the date of the initiation of customer choice, and have ultimately
designated another entity that will serve as the POLR pursuant to Texas
Utilities Code§ 40.053.
(4) LP&L has the necessary software in place that bills the retail electric
providers and manages customer and meter related transactions and is fully
operational and all necessary testing completed.
(5) LP&L has its EDI Gateway, which consists of a communication channel
with ERCOT and all other required parties, fully operational and all
necessary testing completed.
(6) LP&L has completed its distribution system cutover such that all
distribution within LP&L's certificated retail service area is disconnected
from the SPS Legacy System, and connected with LP&L's current
distribution system.
(7) The Electric Utility Board and the City Council of the City of Lubbock have
determined that there are, and will continue to be, a sufficient number of
retail electric providers, including a sufficient number of independent,
unaffiliated retail electric providers within the ERCOT market and that are
willing and able to provide service in Lubbock to adequately provide
competitive customer choice for LP&L's certificated area.
(8) LP&L has executed any and all necessary contracts with REPs who intend
to serve LP&L's certificated area upon the initiation of customer choice.
(9) LP&L has made any necessary filings with the PUC regarding its generation
function, to the extent required under Texas Utilities Code § 40.55(a)(2) and
rules promulgated thereunder.
(10) To the extent desired by the governing bodies, the Electric Utility Board has
recommended and the City Council of the City of Lubbock has approved an
ordinance requiring the registration of REPs that are serving the City of
Lubbock pursuant to Texas Utilities Code § 39.358.
(11) The Electric Utility Board and the City Council of the City of Lubbock have
approved the Tariff for Competitive Retailer Access for the City of
Lubbock, acting by and through Lubbock Power & Light, as provided in 16
Texas Administrative Code§ 25.215 and Appendix V to the PUC Electric
Substantive Rules, 16 Texas Administrative Code, Chapter 25, and further
approved the rates for open access on distribution facilities under Texas
Utilities Code § 40.058, and filed same with the Public Utility Commission
of Texas no later than 90 days prior to the implementation of customer
choice.
(12) LP&L has taken all steps necessary to continue the metering function for its
customers in its certificated service area, with such metering function not
being competitive as provided in Texas Utilities Code §§ 40.053(b) and
40.057.
(13) LP&L has substantially completed installing its advanced metering
infrastructure for electric service in LP&L's certificated area.
(14) The Electric Utility Board and the City Council have approved a transition
to competition plan for customers in LP&L's certificated area that have not
affirmatively selected their own retail electric provider prior to the date
retail choice is initiated.
(15) Any of the foregoing conditions may be waived by the Electric Utility
Board and the City Council if and only to the extent such conditions are no
longer legally required for the adoption of customer choice in the City of
Lubbock.
(16) The Electric Utility Board and the City Council of the City of Lubbock
have, by resolution, confirmed that the foregoing conditions in this
resolution have, in their sole judgment, been satisfied or exceeded and have
established a date certain for when customer choice will begin in the City
of Lubbock.
The council's resolution states that, "the City Council of the City of Lubbock believes that customer
choice and retail electric competition will benefit the citizens of Lubbock and
enhance growth and development in Lubbock."
The council's resolution notes that, per statute, the decision to participate in customer choice by the adoption
of a resolution is irrevocable.
"[T]he decision to initiate customer choice upon the conditions outlined
herein is forever irrevocable and cannot be revoked, recalled, repealed, or altered
in any way," the resolution notes
Noting last year's volatility in the ERCOT market, a representative of LP&L appearing before the city council noted that moving to customer choice would reduce risk for LP&L (from not having to arrange power supply and being exposed to spot prices) and would allow it to focus on its delivery operations
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February 22, 2022
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Copyright 2010-21 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com
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