Texas TDU Enters $1 Million Settlement With PUC Staff Concerning Meter Reading

October 7, 2024

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Copyright 2024 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com

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Texas-New Mexico Power Company has agreed to a $1 million write-down of an existing regulatory asset, such that the regulatory asset would not be recovered from customers as could have otherwise occurred, under a settlement with Texas PUC Staff to resolve alleged violations resulting from the discontinuation of the 3G cellular network, which TNMP had relied upon for AMI communication, and a resulting period in which TNMP relied upon an excessive number of estimated meter reads as it did not have in place replacement meters at all meters prior to the 3G shutdown.

PUC rules provides that utilities must follow their tariff, and may not charge rates inconsistent with their tariff provisions

Section 4.7.2 of TNMP’s Tariff provides that TNMP may only estimate a meter read for a maximum of 3 consecutive months, except in cases of a lack of access due to the customer

Additionally, 16 TAC § 25.130(d)(9) provides that utilities shall report to the PUC significant delays or deviations from their AMS deployment plans, including a description of significant problems that the utility has experienced with its AMS, with an explanation of how the problems are being addressed

The settlement states, "On February 21, 2019, TNMP received notice that the communications network on which its AMS system operated, AT&T’s third generation (3G) network, would be decommissioned effective February 2022."

The settlement states, "On October 2, 2020, TNMP applied for a change to its AMS deployment plan to accommodate the transition to operating on an upgraded communications network."

The settlement states, "On July 30, 2021, TNMP notified the Commission and market participants through the ERCOT RMS listserv and monthly compliance filing in Docket No. 39772 that TNMP was notified by its AMI vendor, Itron, that it was experiencing significant supply chain constraints related to the COVID-19 pandemic as of July 16, 2021."

TNMP asserts that supply chain issues prevented TNMP from receiving additional 4G meters.

The settlement states that, from January 1, 2022 to December 31, 2022, TNMP used estimated meter readings for 17,474 meters for more than three consecutive months.

Among other things, PUC Staff, "asserts TNMP violated 16 TAC § 25.130(d)(9) by failing to sufficiently plan for and execute a strategy to mitigate significant problems it experienced in implementing its AMS deployment plan approved by final order of the Commission."

The settlement states, "TNMP disagrees with Staff’s asserted violations based on Section 4.2.4 of the Tariff, asserting that the violations occurred due to labor disturbances and equipment and material shortages during the COVID-10 pandemic that were beyond its control and could not reasonably be anticipated or prevented through the use of reasonable measures."

The settlement states, "TNMP asserts that its failure to comply with its approved Tariff, which resulted in TNMP estimating readings for 17,474 meters more than three times consecutively was due to labor disturbances and equipment and material shortages caused by the COVID-19 pandemic. In particular, TNMP was unable to obtain meters from the manufacturer due to the chip shortage and supply chain constraints caused by COVID-19, and it was unable to hire and retain contract meter readers in all areas of TNMP’s service territory due to labor shortages during the pandemic."

Under the settlement, in lieu of an administrative penalty, TNMP agrees to a complete write-down of TNMP’s regulatory asset related to its COVID-19 expenses, totaling $1,052,609

TNMP agrees that it will not seek recovery of any expenses or amounts that it has recorded in its regulatory asset related to COVID-19 in any future rate proceeding.

Docket 54731

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