Meeting Summary - 03/13/2025 Open Meeting

▶️0 - (item:0:Chairman Gleeson calls meeting to order)

▶️0.1 - Commission Counsel Shelah Cisneros lays out Consent Agenda

• Commissioner Hjaltman recused from items 4, 7, 8, 15, 16, and 17.
• Items placed on consent agenda: 2, 3, 7, 8, 10, 11, 13-15, 18, 22-25, 29 and 38.
• No speakers signed up for the consent agenda items.

• Chairman Gleeson called for a motion to approve the consent agenda.
• Motion was approved unanimously.

▶️1 - Public comment for matters that are under the Commission’s jurisdiction but not specifically posted on this agenda

• Shelah Cisneros confirmed one person signed up for public comment.

▶️1 - Joe Gimenez - Former President Windermere Oaks WSC

• Joe Gimenez, former president of Windermere Oaks Water Supply Corporation, detailed his tenure from March 2019 to April 2023.
• Gimenez participated in rate case 50788, which is available on the PUC interchange.
• Temporary manager representatives proposed a new rate of $382 per month, a 132% increase from the previous appealed rate.
• PUC Staff does not support the $382 rate and suggests further study to lower it, proposing Windermere to use $200,000 from a $1,250,000 land sale to offset costs.
• Gimenez argues that Windermere needs the $200,000 for retrofitting a 125,000-gallon storage tank into a clarifier.
• In 2024, Windermere lost $200,000 following staff's rate implementation, using reserves to meet loan covenants and repay loans.
• Due to financial strain, Windermere used part of the land sale money for legal fees and to cover unpaid operational costs.
• He urges Commissioners to allow the use of land sale funds for necessary infrastructure upgrades to prevent potential adverse effects on water quality amidst ongoing drought conditions.

▶️4 - Docket No. 54617; Application of Texas Water Utilities, L.P. and Southern Horizons Development, Inc. for Sale, Transfer, or Merger of Facilities and Certificate Rights in Liberty and Montgomery Counties

• Consideration of a motion for rehearing filed by Texas Water Utilities.
• Chairman Gleeson submitted a memo concerning the item.
• Commissioner Hjaltman is recused from this agenda item.

▶️4 - Chairman Gleeson lays out his memo

• Chairman Gleeson recommended granting rehearing for a limited purpose.
• Proposal to remand the proceeding to Docket management.
• Focus on handling the CCN map, the certificate, and tariff issues.

• A motion was made to grant a rehearing or remand the proceeding to Docket Management, aligning with a previously submitted memo.
• Motion was approved unanimously.

▶️5 - Docket No. 55808 – Petition of MM Terrell 1098, LLC to Amend Rose Hill Special Utility District’s Certificate of Convenience and Necessity in Kaufman County by Streamlined Expedited Release

• A motion for rehearing was filed by Rose Hill.
• The Commission voted to place this item on the agenda to extend the time to act on the motion.

• A motion was proposed to extend the time to act on a motion for rehearing to the maximum amount authorized by law.
• Motion was approved unanimously.

▶️6 - Docket No. 56171 – Petition for an Emergency Order Appointing a Temporary Manager to Blue Cereus, LLC Without a Hearing, Under Tex. Water Code § 13.4132 and 16 TAC §24.355

• Commission Staff has filed this petition.
• The decision to make is whether to affirm, modify, or set aside the emergency order.
• Initial opinion is to affirm the emergency order; open to further thoughts.

• Proposal to affirm the emergency order filed by the Executive Director.
• Motion to affirm was put forward.
• Motion was approved unanimously.

▶️9 - Docket No. 56974 – Application of SJWTX, Inc. dba the Texas Water Company to Amend Its System Improvement Charges

▶️9 - Chairman & Commissioner's Thoughts on the Application

• The Commission recently denied an application for a system improvement charge. 
• The recommendation is to remand the proceeding to document management for Texas Water to provide additional information. 
• The application lacks detailed explanations of how each project will improve service; only general statements were provided.
• Project descriptions in the application are too general and need more detail.
• Emphasis on the need for detailed information in applications to align with Commission rules.
• Highlighting the necessity for detailed project descriptions to ensure streamlined processing as intended by the legislature.

• A motion was made to reject the proposal for decision.
• The purpose was to remain the application and document management for further processing.
• Motion was approved unanimously.

▶️12 - Docket No. 57386 – Application of CSWR-Texas Utility Operating Company, LLC for Authority to Change Rates

• A draft preliminary order is presented for consideration.

▶️12 - Chairman Gleeson lays out his memo

• Chairman Gleeson supports processing the application as a Class B, accepting it as Class A without requiring a refile.
• CSWR responded, arguing that the law supports a Class A treatment due to taps and connections.
• Chairman Gleeson identifies two paths: follow his memo's recommendation or add as an issue at SOAH.
• The Chair had staff review the application; concluded it doesn't address inactive taps/connections.
• Rules specify classification based on active connections for water and sewer service.
• The Chairman agrees with the application being processed as Class B based on the provided connections.
• He supports moving forward with Class B processing, indicating the rule clarity on active connections.

• A motion was made to modify the preliminary order consistent with a specific memo.
• Motion was approved unanimously.

▶️16 - Docket No. 56211; SOAH Docket No. 473-24-13232 – Application of CenterPoint Energy Houston Electric, LLC for Authority to Change Rates

• A revised proposed order addresses an unopposed agreement.
• Chairman Gleeson filed a memo regarding this Docket.
• Commissioner Hjaltman is recused from this item.
• Chairman Gleeson filed a memo mainly about the $5,200,000 one-time refund.
• Proposal to treat the refund through a compliance Docket for efficient distribution to customers.

• Motion to approve the revised proposed order was introduced.
• Changes outlined in a memo were included in the revised order.
• Motion was approved unanimously.

▶️17 - Docket No. 56440 – Application of New Braunfels Utilities to Change Transmission Cost of Service and Wholesale Transmission Rates

• The Commission placed this docket on the agenda to evaluate the merits of the motion.
• Commissioner Hjaltman is recused from this item.
• Commissioner Jackson expressed comfort in denying the motion after reviewing the docket and arguments.

• A motion to deny the motion for rehearing was made.
• Motion was approved unanimously.

▶️19 - Docket No. 56954; SOAH Docket No. 473-24-25125 – Application of Texas-New Mexico Power Company for Approval of a System Resiliency Plan

• Previous discussions have taken place regarding this item.

▶️19 - Commissioner Hjaltman's thoughts on application

• Commissioner Hjaltman filed a memo regarding the resiliency plan on February 19.
• The resiliency plans aim to enhance utilities' resiliency beyond normal business operations.
• Commissioner does not support the inclusion of two underground programs, believing TNMP lacks justification and experience.
• No sufficient metrics were provided to assess benefits from TNMP's proposed programs.
• TNMP's letter lacked adequate accounting for the $88 million proposed funding.
• Supports reducing the proposed budget for the resiliency plan to $46 million.
• Advocates for retaining enhanced tree assessment mitigation due to its impact on resiliency with Texas storms.
• Clarifies that the resiliency plan should not replace existing mechanisms in utility operations.
• Supports an overall consumer impact of $891 due to the proposed changes, instead of $851 as initially filed.

▶️19 - Commissioner Jackson's thoughts on application

• Commissioner Jackson expressed that two programs suggested for removal did not have any benefit-cost ratios provided.
• The enhanced tree risk assessment program was part of the overall benefit-cost ratio for proactive vegetation management over a 20-year cycle.
• Commissioner Jackson believes maintaining a portion of the program outlined in their memo is a good path forward.
• The focus is on addressing increased residential consumer costs while initiating vegetation management.
• Other utilities have cyclic programs that are moving towards technology-based solutions for vegetation management.
• Recognition of the project's inclusion of remote sensing, which is a key element in addressing wildfires.
• Situational awareness project costs were significantly reduced from $25.1 million to $8.5 million.
• Emphasis on evaluating the performance of these plans across the state with similar metrics, such as customer minutes interrupted and system restoration cost ratios.
• Commissioner Jackson supports incorporating these metrics into the plans moving forward.

▶️19 - Shelah Cisneros' Clarifying Question to Commissioner Jackson

• Shelah Cisneros asked a clarifying question to Commissioner Jackson regarding the timing of the incorporation of metrics.
• Commissioner Jackson confirmed the incorporation of metrics will occur in the current proceeding.

• A motion was made to modify the proposed order consistent with a memo filed on February 9.
• The motion was also modified by the discussion held during the meeting.
• Motion was approved unanimously.

20

• Not Discussed

▶️21 - Docket No. 57160 – Complaint of Frank Chou Against CenterPoint Energy Houston Electric, LLC

• A proposal for decision is presented with a Commission Counsel memo recommending changes to the order.
• The Commission voted to grant oral argument in this docket.
• Three parties signed up for oral arguments.

▶️21 - Patrick Peters - Associate General Counsel - CenterPoint Energy

• CenterPoint resolves most issues informally, but there's a disagreement in this case.
• The dispute centers on a Commission safety rule requiring a manual disconnect device for DG facilities interconnected to the utility's grid.
• The manual disconnect device is crucial for safety, allowing utility personnel to ensure the DG is disconnected, preventing unintended energy backfeed.
• This safety rule has been in place for over twenty-five years.
• The proposed DG facility doesn't comply with this requirement according to the preferred PFD recommendation.
• Some documents suggest the rule doesn't make sense or should change.
• CenterPoint supports the existing rule for worker safety.
• Any desired changes should occur through a rulemaking process for stakeholder participation.
• CenterPoint requests the Commission to adopt the PFD and dismiss the complaint.

▶️21 - Glen Imes - Attorney - Commission Staff

• Commission Staff supports the summary disposition in this case.
• There are no material facts in dispute, making summary disposition appropriate.
• The goal of summary disposition is to preserve state resources and avoid unnecessary formal hearings.
• Frank Chou does not dispute the absence of a visual break in his system, which is required by current rules.
• Frank Chou disputes the rule itself, claiming it is outdated and non-compliant with the National Electric Code.
• The Texas law is the standard, not the National Electric Code.
• This proceeding is not the appropriate venue for challenging or changing the rule.
• There are proper procedures under the APA for rule challenges or changes.

▶️21 - Frank Chou - Texas Farmer

• Frank Chou expressed frustration with the process for modifying his solar power system to include storage. 
• He faced issues due to needing to change the inverter, and CenterPoint Energy initially rejected his proposed device.
• Chou argues that his service disconnect device is compliant with NEC 2023 code, but CenterPoint is insisting on a less safe device called a safety switch.
• Chou feels that the mandated safety switch lacks overload protection, potentially endangering workers.
• He stressed that his inverter has a built-in safety feature that disconnects if the grid fails, ensuring no danger to utility workers.
• Chou highlighted that the service disconnect is widely used and regarded as safe, but he's being denied access to sell electricity to the grid.
• Commissioners are considering the need to revisit existing rules due to technological advancements.
• There is an agreement to defer any decisions until further review and consideration of potential rule changes.

26-28

• Not Discussed

▶️30 - Project No. 56896 – Texas Energy Fund In-ERCOT Loan Program Reports and Filings

▶️30 - Laurie Hobbs - Commission Staff - Recommendation of 2 applications

• Staff recommends advancing two applications totaling 895 megawatts to due diligence, with authority for the executive director to enter loan agreements upon successful due diligence completion.
• The current portfolio of due diligence loan applications comprises 9,774 megawatts and $5,370,000,000.
• Selection of projects follows a similar process as previous rounds and aims to align with attributes of a withdrawn application that they are replacing.
• Challenge in finding viable projects in the same load zones, due to tight timelines and a preference for projects ready to commence construction.
• Commission Staff prioritizes applicants demonstrating readiness in areas like long lead time equipment, equity commitment, and engineering contracts.
• A continuous effort is emphasized to ensure approved projects can meet deadlines and come online timely.

▶️30 - Barksdale English - Deputy Exec. Director - Percentage of groups in portfolio

• Approximately 35% of the portfolio is represented by the four largest generation companies in ERCOT.
• The four largest companies are Luminant, NRG, Calpine, and Constellation.
• There is potential to increase competition by bringing in more participants.

• Motion to approve two projects selected by staff was proposed.
• Motion was approved unanimously.
• Authority was delegated to the executive director to proceed with due diligence.

▶️31 - Project No. 57774 – Electric Utility Correspondence on Insurance Premiums

• A number of letters were initially filed in the Docket during the open fiscal year.

▶️31 - Chairman Gleeson's thoughts on insurance premiums

• Chairman Gleeson acknowledges that rising insurance premiums have become a significant issue for companies in the state.
• Companies are seeking guidance on how to proceed with these increased costs, but Chairman Gleeson feels it's not appropriate for ERCOT to provide prescriptive guidance.
• He suggests companies can file a request for deferred accounting treatment, though it is a challenging process.
• The subject of high insurance premiums is important and needs attention, but immediate actions from ERCOT may not be viable.
• Chairman Gleeson encourages companies to propose solutions as they are closest to the issue and understands that the situation impacts both the companies and ratepayers.
• He acknowledges the legislature is also aware of the issue, appreciating companies for bringing it to their attention.
• There is a suggestion to be open to new ways or hybrid approaches to address escalating costs, without compromising company success or ratepayer interests.

32-33

• Not Discussed

▶️34 - Project No. 41210 - Information Related to the Southwest Power Pool Regional State Committee

▶️34 - Commissioner Jackson's Update

• Commissioner Jackson attended her first SPP Energy Synergy Summit as Texas delegate in Dallas.
• Participated in a panel with Oklahoma and Missouri Commission Chairs, moderated by SPP board member Stuart Solomon.
• Discussed affordability, consumer impacts, reliability, and impacts of large loads.
• Attended the resource and energy adequacy leadership team meeting.
• Experience provided insight into challenges and opportunities related to resource adequacy, load and generation interconnection, and grid modernization.
• Observed that load growth in Texas is also occurring across the nation and in the SPP region.
• Mentioned attending the next SPP regional state committee meeting in early May.

35-37, 39-40

• Not Discussed

▶️41 - Discussion and possible action regarding agency review by Sunset Advisory Commission,operating budget, strategic plan, appropriations request, project assignments, correspondence, staff reports, agency administrative issues, agency organization, fiscal matters and personnel policy

▶️41 - Commission Counsel Shelah Cisneros' Update

• Shelah Cisneros provided two updates of interest to stakeholders.
• The scheduled open meeting for Thursday, June is moved to Friday, June 20 due to Juneteenth Emancipation Day.
• The website will be updated to reflect the new meeting date.
• ERCOT will no longer provide courtesy copies of the service list as information is available in AIS.
• Parties are encouraged to maintain their own service lists using publicly available information.
• Implementation of this change will occur next week.

42-43

• Not Discussed

▶️44 - Adjournment for closed session to consider one or more of the following items...

• No action was taken by the Commission on matters discussed in the closed session.

▶️44 - Chairman Gleeson Adjourns Meeting