Settlement In Principle Reached On Texas PUC Staff's Sought Declaratory Order Interpreting Fixed Price Rule -- EnergyChoiceMatters.com

Settlement In Principle Reached On Texas PUC Staff's Sought Declaratory Order Interpreting Fixed Price Rule

March 6, 2024

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Copyright 2010-23 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com

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Texas PUC Staff, various Just Energy REPs, and OPUC said that they have reached a settlement in principle concerning Staff's petition for a declaratory order from the PUC interpreting 16 TAC § 25.475(b)(5), the fixed price product rule

Parties did not yet file an executed settlement, but asked that the proceeding be abated to allow the settlement to be drafted and filed

The parties jointly said, "The parties have reached a settlement in principle in which all parties agree that this proceeding should be resolved with a Commission order granting the declaration sought by Commission Staff’s January 31, 2024 petition."

The parties further said, "The parties recommend that, because the scope of the settlement agreement will be limited to a declaration resolving only the real, discrete controversy at issue in this proceeding -- that is, Commission Staff’s investigation of the Just Energy affiliates for the specific facts alleged in the January 31, 2024 petition -- it is appropriate to abate this proceeding without addressing the issues certified to the Commission on February 2, 2024."

As previously reported, Staff's petition relates to an issue raised previously by Staff last year concerning Uri securitization charges incurred by REPs, and not the issue of new ancillary service costs (which REPs have raised separately as previously reported)

Specifically, Commission Staff in its petition for a declaratory order (which would apparently be granted per the motion to abate) requested that the Commission enter an order declaring that, under PURA § 39.112(a) and 16 TAC § 25.475(b)(5), retail electric providers may not increase the price charged under a fixed rate contract entered on or after August 1, 2022 to reflect fluctuations in the amount of Securitization Charges incurred by a REP over the life of a customer’s fixed rate contract.

As noted above, two questions in the proceeding had been certified to the Commission, and were scheduled to be addressed at tomorrow's open meeting. One of the issues was: "Who are the persons and entities that may be affected by the declaratory order sought by Commission Staffs petition?"

In advance of tomorrow's open meeting, Commissioner Lori Cobos had issued a memo proposing that such certified issue be answered as follows: "The Declaratory Order can affect all REPs currently serving residential and/or small commercial customers under a contract for a fixed rate product[.]"

See background on the issue here

At the time Staff's petition had been originally filed, Just Energy on January 31, 2024 had provided the following statement concerning the matter:

"The amount of Securitization Charges from ERCOT vary daily. Just Energy’s, Amigo Energy’s and Tara Energy’s ERCOT Securitization charges to customers are adjusted periodically to reflect these changes. We believe such adjustments are in the best interests of all customers and we have always been transparent with our customers regarding the ERCOT securitization charges. We will file a response to the Petition for a Declaratory Order and will, of course, follow any guidance offered by the Commission as a result of this proceeding."
--- January 31, 2024 Statement from Just Energy

The joint motion to abate states, "The parties acknowledge that, if settlement efforts are ultimately unsuccessful, the proceeding may be unabated and the certified issues may be considered by the Commission before further litigation ensues."

Docket 56168

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