The Texas Public Utility Commission last week moved a step closer to approving the construction of two 345-kV transmission lines needed to transition about 70% of the city of Lubbock’s load from SPP to ERCOT.
The single-circuit lines would be built on double-circuit-capable structures and are part of a $247 million project to integrate the West Texas city’s utility, Lubbock Power & Light, into the Texas grid. Oncor will build the lines, then turn them over to LP&L.
The PUC reopened the record on the project during its open meeting Thursday to include additional testimony and other information. The commissioners directed staff to file final order drafts before its Sept. 26 meeting.
One 58-mile line would connect substations in Ogallala and Abernathy at about $90 million. Associated substation work would increase the cost to nearly $100 million (48625).
The cost structure is part of a settlement reached between Oncor, Sharyland Utilities and Sempra Energy. (See “Commission Signs off on Oncor-Sharyland-Sempra Deal,” Texas PUC Briefs: May 9, 2019.)
The second line would be 33 miles long and run from Abernathy to Wadsworth. The circuit and substation work is projected to cost about $74 million (48668).
Both lines are scheduled to be energized by June 2021, meeting LP&L’s target date to join ERCOT. LP&L announced in 2015 that it intended to shift about 470 MW of its load from SPP to ERCOT, a move that was approved last year. (See Texas PUC OKs Sempra-Oncor Deal, LP&L Transfer.)
Lowest Rate Securitization ‘in the Universe’
AEP Texas finalized the pricing of $235.3 million of system restoration bonds previously authorized by the PUC, resulting in an overall average interest rate of 2.225% (49308).
“Is this the lowest rate for securitization ever in Texas?” Commissioner Arthur D’Andrea asked.
“It’s the lowest rates of any Texas utility’s securitization in the history of the universe,” replied Darryl Tietjen, director of the PUC’s rate regulation, as laughter filled the room.
Tietjen said the securitization beat a 2.28% rate on AEP Texas Central’s $800 million bond issuance in 2012.
He also said staff do not expect to perform detailed analyses on required year-end earnings reports filed by Texas’ 13 investor-owned utilities. He said staff similarly do not plan to recommend comprehensive rate proceedings for the 38 non-IOU utilities, as many have received rate orders or have pending proceedings (49355).
PUC Fines CPS Energy $125K
The commission approved a settlement agreement docking San Antonio’s CPS Energy $125,000 for a failure to provide non-spinning reserve service as required on occasions in 2015 and 2016 (49332).
The PUC also signed off on distribution cost recovery factors for Entergy Texas (49392) and Oncor (494279) and an adjustment to Southwestern Electric Power Co.’s energy efficiency cost recovery factor (49499).
— Tom Kleckner
