AUSTIN, Texas, Jan. 12, 2012 – The Public Utility Commission of Texas (PUCT) today unanimously approved a financing order that will allow AEP Texas Central Company (TCC) to move forward with securitizing approximately $800 million associated with TCC’s transition to retail competition.
The financing order allows TCC to sell bonds to recover the amounts approved by the PUCT and to implement a Transition Charge. The impact of this Transition Charge on consumer bills is estimated to be approximately $3.30 a month for a residential consumer using 1,000 kilowatt-hours of electricity a month. This estimate could increase or decrease depending on interest rates and other factors associated with the securitization financing, which is expected to be completed by the end of March.
The $800 million is the amount agreed upon by TCC and stakeholder groups in a settlement, which was approved by the PUCT on Dec. 15, 2011. The uncontested settlement resolves all remaining issues associated with the transition to retail competition which began in 2002. In 2005 the PUCT issued its initial decision on several transition to competition issues, which TCC subsequently appealed to the courts. In July 2011, the Texas Supreme Court reversed a key portion of the PUCT’s initial decision and ruled in favor of TCC.
AEP Texas serves nearly one million electric consumers in the deregulated Texas marketplace. As an energy delivery (wires) company, AEP Texas delivers electricity safely and reliably to homes, businesses and industry across its nearly 100,000 square mile service territory in south and west Texas. AEP Texas also builds new power lines, restores service following outages and reads the meters for retail electric providers (REPs) throughout its service territory. The company also connects or disconnects service upon the orders of the REPs.
AEP Texas is part of the American Electric Power (AEP) system. AEP is one of the largest electric utilities in the United States, delivering electricity to more than 5 million customers in 11 states. AEP ranks among the nation’s largest generators of electricity, owning nearly 38,000 megawatts of generating capacity in the U.S. AEP also owns the nation’s largest electricity transmission system, a nearly 39,000-mile network that includes more 765-kilovolt extra-high voltage transmission lines than all other U.S. transmission systems combined.