(item:0.1:Chairwoman Jackson calls meeting to order) Good morning. This meeting of the Public Utility Commission
of Texas will come to order. To consider matters that
have been duly posted with the Secretary of State of
Texas for June 15, 2023. For the record, my name is
Kathleen Jackson. And I'm joined today by Will McAdams,
Lori Cobos and Jimmy Glotfelty. (item:0.1:Chairwoman Jackson calls for a motion to excuse Commissioner Lake) Commissioner Lake is
out today due to a personal matter. I would like to
entertain a motion to excuse his absence.
So moved. Second. I have a motion and a second. All in favor, say aye.
Aye. Motion passes. Before we get started with the Agenda, (item:0.1:Chairwoman Jackson gives thank you to Staff and her thoughts on the future)
obviously things look a little different up here today.
I'm honored to have been named Interim Chair by Governor
Abbott. And I would like to thank Peter for his tireless
dedication as Chairman for this agency and the State.
For keeping the lights on and ensuring Texans have
reliable and affordable power. It's been a joy to get
to know so many of the Staff here at the PUC. Many
of the stakeholders and members of the public. I'm
extremely grateful as a Commissioner and as a Texan
for everyone's hard work. We have a lot of work ahead
including implementation of Legislation from the recently
concluded legislative session and continuing to ensure
the goal we all share. Reliable and affordable, essential
utility services. I want to say thank you to Thomas,
Connie, Haley and our GR team. And all of the many
Staff that contributed in so many ways to the Legislative
process on top of their existing work Load. Congratulations
on a successful Session for the PUC. Our agency is
well positioned because of our Staff. Your talent,
your commitment and the work you do each and every
day focused on success. I look forward to working with
each of my fellow Commissioners. And all of you as we
build upon our many accomplishments. And with that,
I'd like to open it up for any comments, uh from my
fellow Commissioners. (item:0.1:Commissioner McAdams' thanks to Commissioner Lake) Uh thank you Madam Chair. Uh
I, I'd like to echo your thanks to Chairman Lake or
Commissioner Lake. Um it, it has been an extraordinary
two years at the Public Utility Commission. Um I had
the privilege to serve with him the entire time. Uh
and he demonstrated extremely competent and able, and
steady leadership during that extraordinary time. Where
uh the Commission Staff, uh ERCOT, um the industry.
Was asked to, to pick ourselves up. Put ourselves back
together, um and reassure the public. That, that ubiquitous
essential service that we call electricity will remain
on and will, will remain reliable. Um he was an extremely,
is an extremely dynamic leader. And uh the, the
State owes him a debt of gratitude. And uh I just want
to make sure that my thanks is demonstrated here.
(item:0.1:Commissioner Glotfelty gives congratulations to Chairwoman Jackson) Uh I, I would like to say congratulations to
you. Um for, for being nominated as Chairman. Around
this room, there are pictures of many women that have
Chaired this Commission. And I think it's great that
uh, that you're joining that club. So we look forward
to working with you. Same. It's a team effort, appreciate it.
All right. Thank you. (item:0.1:Commissioner Cobos thanks Commissioner Lake and congratulates Chairwoman Jackson) Um I would like to echo some
of the statements from my fellow Commissioners. I'd
like to thank Chairman Lake as well. Um for his hard
work and leadership at the Commission. Um, after Winter
Storm Uri, it certainly was one of the most critically
uh difficult and important times in the Commission's
history. And stepping into a job like that is, is no
um is, is no easy job. And um, he stepped in and
did the best he could to lead our agency um for the
last two years. And implementing all the Legislation
that was passed during Winter Storm Uri or post-Winter Storm
Uri. And um, just like to thank him for his hard work and
um leadership at the Commission. And, and chairing the
Commission and also um congratulate you, um Chair Jackson.
And um, I'm excited for you and I'm here to work with
you. And wish you the best and we will continue to charge
forward with all the work we have to do. Well, said.
I'd like to say one other thing and that is good luck
getting a new name plate. It might take a while.
Well, appreciate everybody's kind words. And um, you
know, just echo my thanks to Peter. And I look forward
to working together, it's a team effort. And we're fortunate
that we have so many talented and engaged and committed
people uh to help the citizens across our state. We
have a lot of work ahead but um very confident that
we're going to get it accomplished. Um, so with that
Mr Journeay, will you please walk us through the Consent
Items on today's Agenda? (item:0.1:Chairwoman Jackson asks for motion to approve items on Consent Agenda) Good morning Commissioners.
By individual ballot, the following items were placed
on your Consent Agenda 10, 13, 16 and 17. And I need
to announce that uh Commissioner Cobos is recused
from Item 16.
I will entertain a motion to approve the items just
described by Mr. Journeay.
So moved. Second. Do I have a second? Do you have a second? Uh all in
favor, say aye. Aye. Motion passes.
(item:1:Chairwoman Jackson lays out instructions for public comment) Let's begin with Item No. 1, Public Comment. Oral
comments related to a specific Agenda Item will be
heard when that Item is taken up. This is for general
comments. When we get to oral comments on specific
Items, stakeholders should not approach the table unless
an oral argument has been granted or they have been
invited by a Commissioner. Speakers will be limited
to 3 minutes each. (item:1:Mr. Journeay confirms there are no public comments) Mr. Journeay, do we have anyone
from the public signed up to speak. No, ma'am. No one
has signed up this morning. Okay. If not public comment
is now closed. I will now call, uh call up 5 Items
together. Items 2, 5, 6, 7 and 8. Uh Mr. Journeay, will you
please lay, lay out each of these items? (item:2:51710, Petition of Honey Creek Venetian to amend Western Water Supply Corp's CCN) Item 2 is
Docket 51710. Petition of Honey Creek Venetian uh
LLC to amend Western Water Supply Corporation's CCN in
Collin County by expedited release. A motion to withdraw
the petition was filed on May 24.
(item:5:53557, Petition of Honey Creek Venetian to amend Western Water Supply Corp's CCN by expedited release) Item 5 is Docket 53557 petition of Honey Creek Venetian
LLC to amend Western Water Supply Corporation's CCN in Collin
County by expedited release. The motion to withdrawal
was filed on May 24. (item:6:53560, Petition of Honey Creek Venetian to amend Western Water Supply Corp's CCN by expedited release) Item 6 is Docket 53560. Petition
of Honey Creek Venetian to amend Western Water Supply
Corporation's CCN in Collin County by expedited release.
A motion to withdrawal was filed on May 24. (item:7:53648, Petition of Venetian 141 Swisher to amend Western Water Supply Corp's CCN expedited release) Item 7
is docket 53648 petition of Venetian 141 Swisher, LLC
to amend Western Water Supply Corporation's CCN in Collin
County by expedited release. The motion to withdraw
was filed on May 24. (item:8:53703, Petition of Honey Creek Venetian to amend Western Water Supply Corp's CCN streamline expedited release) And Item 8 is Docket 53703.
Petition of Honey Creek Venetian to amend
Western Water Supply Corporation's CCN in Collin County
by streamline expedited release. A motion to withdrawal
was filed on May 24th.
Do we have any thoughts on this one? Uh I certainly
do. Uh and, and I'm glad we decided to take these uh
all up together. (item:2:51710, Commissioner McAdams' comments on Honeycreek Venetian's petition to amend) (item:5:53557, Commissioner McAdams' comments on Honeycreek Venetian's petition to amend) (item:6:53560, Commissioner McAdams' comments on Honeycreek Venetian's petition to amend) (item:7:53648, Commissioner McAdams' comments on Honeycreek Venetian's petition to amend) (item:8:53703, Commissioner McAdams' comments on Honeycreek Venetian's petition to amend) I, I think you noticed some uh consistency
in the motion um related to all 5 dockets. Um In
my view, there's an issue I believe the Commission
must address uh before approval of these orders. Primarily
it is appropriate to utilize. Uh Is it appropriate
whether, it is appropriate to utilize a different methodology
to. Uh my apologies, Commissioners. I am looking at
a different here. Um there is commonality in each of
these dockets. The petitioner has filed a motion to
withdraw its petition without prejudice. However, because
the proposed order, orders were filed in each of the
dockets before the petitioner filed its motion to withdraw.
The Commission may grant a motion to withdraw without
prejudice, only upon finding of good cause. Uh I recommend,
that the Commission find that good cause exists to
grant the motion to withdraw and dismiss the uh petitions.
Because the petitioner no longer requests the release
of its tract of land. Um and I have a uh motion.
Uh I would certainly entertain any discussion. But
in my view, this is a uh clean up effort on the
5 uh proceedings. And I certainly have a motion to
help in that. Unless anybody has countervailing thoughts.
I would just throw in that the other good cause. Well
this will relieve our work load at the federal district
court. Great point, Mr. Journeay.
Uh with that, (item:2:51710, Motion to grant motion to withdraw petitions) (item:5:53557, Motion to grant motion to withdraw petitions) (item:6:53560, Motion to grant motion to withdraw petitions) (item:7:53648, Motion to grant motion to withdraw petitions) (item:8:53703, Motion to grant motion to withdraw petitions) uh I would move that we find that good
cause exists to grant the petitioner's motion to withdraw
each of the petitions in the aforementioned dockets
and grant the motion to withdraw in each of those dockets.
And dismiss each of the petitions in those dockets
without prejudice. Do I have a second? Second. All
in favor, say aye. Aye. Motion passes. Thank you.
Next up is Item No. 3. Uh Mr. Journeay, will you
please lay out this item? (item:3:52877, Application of Vineyard Ridge Water Supply for authority to change its rates) Item 3 is Docket 52877.
The application of Vineyard Ridge Water Supply for
authority to change its rates. The revised proposed
order was filed on May 3. Happy to take this one.
Um (item:3:52877, Commissioner Cobos' thoughts on Vineyard Ridge Water Supply's application) I believe the Commission should not approve the
proposed order. Based on my review of the Texas Water
Code and the facts of the case. The Commission should
remand the case back to Docket Management for further
processing. To seek to address whether 10% of the utilities
ratepayers file complaints. And a hearing was required
to be set under Texas Water Code, Section 13.1871, Subsection
I. Under Texas Water Code 13.1872, Subsection C-2.
A Class D water utility must comply with the procedures
set forth in Texas Water Code 13.1871 for rate change.
Uh specifically, Subsection I in, in that uh section
of the Water Code. Requires that a Hearing be set, even
if a hearing is not requested. If more than 10% of the
utilities, ratepayers file complaints. Um Vineyard
Ridge had 56 connections at the time the application
was filed to change the rates. Um after ratepayers
received the first notice of the utilities proposed
rate change with an effective date of May 1, 2022.
Twenty-two protests and four motions to intervene were
filed. After ratepayers received their 2nd notice,
of the utilities proposed rate change, with an updated
effective date of August 1, 2022. Twenty-five protests and three
motions to intervene were filed. Therefore, it appears
that more than 10% of the rate payers complained about
the utilities proposed rate, rates before the 91st day
after the effective date of the rate change. Per the
Texas Water Code um, section. But it is unclear from
the record, whether the protests and interventions were
from the utilities current ratepayers. Therefore, it
is unclear whether the ALJ was required to set a Hearing.
Unlike prior Commission, preliminary orders and final
orders. The ALJ's proposed order does not address Texas
Water Code 13.1871, Subsection I. Requirement for a hearing
either through a finding effect, identifying the number
of complaints or a conclusion of law addressing whether
a hearing was required under the Water Code. If the
minimum protest threshold under the Water Code was
met, the Commission is statutorily required to set
a hearing. Whether it's a formal hearing at SOAH or
an informal hearing through a prehearing conference
at the Commission. And then after the hearing, if the
Commission finds that the proposed rates are not
reasonable, the Commission shall set the hearing. So
it's important to determine whether or not a hearing
was required. And uh, based on my review of the facts
it's not, even though it appears there was 10% more
uh, greater than 10% of ratepayers. We don't know if
they're actually ratepayers that filed the complaints
um, ratepayers and utility. (item:3:52877, Motion to remand case back to Docket Management) So I would propose and
move. That we um, remand the case back to Docket Management
for further processing, consistent with my assessment.
Any else? (item:2:51646, Commissioner McAdams’ thoughts on Vineyard Ridge Water Supply application) I agree. I, I'll bow toward your interest
in, in clarity uh Commissioner. I, I was of the view
that look. I, I believe we had uh, 10% of the
ratepayers complaining um, to a degree. But as you
as you clearly allude to. There's a question of law
whether that constitutes that, that threshold to require
that hearing. So um that I, I'd support the motion
to remand back, and then seek clarity on whether the
the statutory threshold was met.
Okay.
So you have a motion to remain the case to Docket Management
for further process and consistent with our discussion.
Uh, do I have a second? I'll second. All in favor, say aye. Aye.
Motion passes.
Next up is Item 4. Mr. Journeay, will you please lay
out this Item? (item:4:53336, Application of Big Easy Aqua for a CCN in Colorado County) Item 4 is Docket 53336. Application
of Big Easy Aqua for a CCN in Colorado County. A proposed
order was filed on May 24. And I have a memo with
proposed changes to that order.
Thank you, Steven. Any thoughts on this one? Um, it
I'll, I'll take it. If anybody uh, if everybody is
ok with it. (item:4:53336, Commissioner McAdams' comments on Big Easy Aqua's application) Look in, in my view, Big Easy Aqua's application
is lacking in several respects. Um first, the utility
has not filed a statutorily required capital improvements
plan. And second, the utility may not have uh filed
sufficient firm capital commitments. And third, the
utility has requested a larger CCN that is, that is
required for service. We have precedents established
within this Commission on all three of those respects.
Big Easy in my view, needs to file capital improvements
plans. Showing how they plan to serve the area of their
application. So far they have failed to do so and shown
in the evidence where their engineering plans indicate.
That the constructed distribution system can only serve
40 of the 120 planned lots. Additionally, they have not
provided evidence indicating that they have firm capital
commitments to serve the entirety of the 120 planned
lots. As such um I, I'd entertain any other thoughts
on this. But I have a motion uh to act on the
proposed order. Anybody else? I, I would just say.
(item:4:53336, Commissioner Glotfelty's comments on Big Easy Aqua's application) Um, you know, these uh become more and more challenging
in my opinion. As we have these rural neighborhoods
that spring up, you know, are developing. You know
massive plots of land, hundreds of acres or, or dozens
of acres. And I think it's right that they are thinking
long term about how to deploy a water wastewater system
for the entirety of the community. Unfortunately, as
you said, our precedent is serve what you have proof
that you can build. Have money that you can build,
show that you can own and operate, and then expand.
And I, you know, maybe that's something we change in
the future. But I think today the precedent is, is
pretty firm, and pretty rigid, and pretty right? So
I agree with you um on the, on the deficiencies of
this order. Uh and support that motion. With, with that
(item:4:53336, Commissioner McAdams' follow-up comments on Big Easy Aqua's application) I'd like to also say that, that. Um that puts
a burden on the Commission or it puts an obligation
on the Commission. To have our um bureaucratic process
is as streamlined as possible. So that, that utility
may come in and amend their CCN, as the expansion of
that development occurs. So that we can quickly and
expeditiously approve those expansions and ensure adequate
and affordable services is provided. So I, I think
that's, that's 100% alignment with. And we discussed that
as this precedent was established as we all came on
to the Commission. I, I'm in agreement. (item:4:53336, Commissioner Cobos' comments on Big Easy Aqua's application) I think the
information that uh, Commissioner McAdams laid out
is required by the Water Code and our Commission rules.
And is consistent with our uh, Commission precedent.
And um, as you stated Commissioner McAdams, I mean
the utility has the ability to come back in and amend
their CCN. As they are able to prove up the
that service is needed for those additional plots of
land. And so the door is not closed. It's just, you
know we're, we're mitigating. We're, we're
following our process. To ensure that the service is
provided to the public that needs it at the time. But
uh the utility is always welcome to come back. And provide
us with additional information and expand their service
territory when they can do so.
(item:4:53336, Mr. Journeay's comments on Big Easy Aqua's application) Chairman, can I make a point? Yes. I appreciate you talking
about expediting our bureaucratic process. Our Staff
works hard and we will never be streamlined. Until the
regulated community educates themself on the law and
our rules. And our filing packages and presents applications
that are.
I can't use the word I wanna use.
That, that are competent. You know, Steven I, I under.
(item:4:53336, Commissioner McAdams' thoughts on Big Easy Aqua's application) I appreciate the position of tough love. Do you? Um but um
we, we've got all shapes and sizes of utilities. Especially
in this, this area. Especially under the Water code.
And um and we will not be rubber stamping any applications.
But um we, we've made great efforts and that's part
of our public engagement. Especially over the last
two years, even in water. Um with our own uh internal
divisions within the agency. To outreach and inform
these utilities or prospective utilities of what is
required. So that they know the information they need,
need to come in the door with. So that they can apply,
we can review and give expeditious approval and, or
denial. Or offer up a remedy to, to cure the deficiencies.
Um so I think we're doing the right things. It's just
a matter of establishing that climate of regulatory
oversight in this area under PUC uh guidelines. Which
is different than other agencies in the past. But we're
gonna get there. That's true, sir. I'll just note that
many of these applications are put together by registered
professional engineers or licensed attorneys. I hold
both of those certificates in this State. I would say
that I don't know that they are living up to their
obligations. Absolutely.
(item:4:53336, Chairwoman Jackson's comments on Big Easy Aqua's application) When I think further to your point, the importance
here is that we have alignment. And that we move forward
and make sure that the facilities that are being provided
and being planned. Have the necessary elements for success
and that being the Financial Assurance and the Capital
improvement plan. And that the, the same time, you
know, we're working as a staff and as you mentioned
very hard uh per the guidelines and the standards to
review those. So in my, in my mind it's it's a, it's
a collaborative effort moving forward. To make sure
that we have the information we need. So that the public
is protected and also to be able to provide that service
in a expeditious manner as we can. So, but thank you so
much for bringing up this points. (item:4:53336, Connie Corona with Commission Staff's comments on Big Easy Aqua's application) Madam Chair, um may
I just put a fine point on the comments of Commissioner
McAdams. Um to state that he was referring both to our
Division of Utility Outreach. Which exists um to help
utilities who are not familiar with our processes to
work their way through them. And of course, our subject
matter experts remain available to answer any questions.
And Utility Outreach can help um the applicants get
in touch with those folks. To answer any questions they
might have, before they bring in their application. Absolutely.
I think that, that's an excellent point is that we are
a resource. And uh the Staff is well respected across
the State and uh has worked hard, and will continue
to work hard. To make sure that we have again that those,
those that information that we need. To make the decisions
going forward to make sure we have the reliable service
and the adequate service.
So with that, you have a motion. I do. (item:4:53336, Motion to remand case back to Docket Management) Uh I would move not to act on the proposed
order and remand it to docket management. So that Big
Easy Aqua may file a capital improvements plan. And specify
whether the firm capital commitments includes all phases
of construction. And reduce the requested CCN acreage
to those areas. That require a CCN for water service
by Big Easy Aqua. Do I have a second? Second. All
in favor, say aye. Aye. Motion passes.
We've already taken up Items 5, 6, 7 and 8. Next up
is Item 9. Mr. Journeay, will you lay out this Item
please? (item:9:54121, Application of Harrison Williams for temporary rates for nonfunctioning utility) Item 9 is Docket 54121. The application
of Harrison Williams for temporary rates for nonfunctioning
utility. A revised proposed order was filed on
May 19. Uh Chairman Jackson has a memo and I have
a memo with proposed changes to the order. Thank you. I did file,
file a memo. (item:9:54121, Chairwoman Jackson's comments on Harrison Williams' application) Um here we have an application for temporary
rates for a water utility. That was filed by the temporary
manager Harrison Williams. Commission Staff has reviewed
the record and worked with Mr. Williams to develop an
agreed temporary rates. That are similar to the applications
proposed rates. I agree with Commission Staff's recommendation
that the temporary rates are reasonable. However, I
did notice the Commission normally includes an additional
ordering paragraph. That provides guidance on our reconciliation
process for temporary rates. And this ordering paragraph
was missing from the revised proposed order. Uh to make
sure that this order is consistent with previous Commission
orders on temporary rates. I'm suggesting adding this
missing ordering paragraph. Um any additional thoughts
on this one?
I'm in agreement. I agree. Me too. I, I thought your memo
memo captured the mechanics of how to move forward.
Um and uh if you would entertain it, uh Madam Chair.
(item:9:54121, Motion to approve proposed order as modified) I'd move to approve the proposed order as modified
by Commission counsel and your memo. I would second that. Thank you. Okay
All in favor, say aye. Aye. Motion passes.
Item 10 was consented. Next Item is Item 11. Mr. Journeay,
will you lay out this item? (item:11:55098, Petition for an order appointing a temp. manager Channel Oaks Water System) Item 11 is Docket 55098.
Petition for an order appointing a temporary manager
for Channel Oaks Water System. Commission Staff filed
a petition to appoint a temporary manager for the Channel
Oaks Water System. And we have a Hearing scheduled
on that petition.
(item:11:55098, Chairwoman Jackson calls for recess to hold separate hearing) And we will recess this meeting of the PUC to hold a separate
Hearing on this Item.
(item:11:55098, Chairwoman Jackson calls merits hearing to order) This meeting of the Public Utility Commission of Texas
will come to order. For the Merits Hearing in Docket
No. 55098, which has been duly posted with the Secretary
of the State of Texas for June 15, 2023. I will now
turn it over to our Commission ALJ for the Administration
of the Hearing. (item:11:55098, Commission ALJ lays out docket on petition for appointing a temporary manager for Channel Oaks WS) Good morning Commissioners. I call
to order Docket No. 55098, which is Commission Staff's
petition for an order appointing a temporary manager
for Channel Oaks Water System LLC. Continuing until
the Commission orders otherwise or until a receiver
is appointed by the appropriate court. My name is Katie
Marks, assisting the Commissioners. And the purpose
of this Hearing is to determine whether a temporary
manager should be appointed. We had a prehearing conference
yesterday and I admitted the 14 exhibits prefiled
by Commission Staff on June 5, 2023. I also admitted
the 3 exhibits for Channel Oak, Oaks which are the
3 items filed by Channel Oaks on June 6,
2023. At this time, we'll take the appearances of the
party starting with Commission Staff.
Good morning. I'm sorry.
(item:11:55098, Introductions from Mildred Anaele, Commission Staff & Pauline Jones, Channel Oaks WS) Good morning, Mildred Anaele for Commission Staff.
For the utility? Oh, I'm sorry. Pauline Jones, uh Channel
Oaks Water System. Um we will move into opening statements,
Commission Staff. Good morning here. Um, (item:11:55098, Opening statement from Mildred Anaele, Commission Staff) we are here
this morning to address Staff's petition to appoint
a temporary manager to Channel Oaks Water System, LLC.
Uh, and I will refer to them as COWS moving forward.
Um, on May 2, 2023, the Commission issued an order modifying
the emergency, uh emergency order issued by the Executive
Director in this matter. On February 23rd, 2023, ordering
COWS to file a sworn affidavit, stating the, stating the
identity of an individual who has the authority
to manage COWS. COWS has failed to file such an affidavit
or otherwise identify a manager of COWS. Additionally
on May 25, 2023, the Commission requested the Attorney
General's Office bring suit to appoint a receiver. Because
of COWS's failure to comply with the Commission's order,
requiring it to identify a manager. And because the
process to appoint a receiver may likely be a lengthy
one. Commission Staff is requesting that the Commission
issue an order identifying CSWR Texas as temporary
manager of Channel Oaks. For a time period identified
by the Commission or until a receiver is appointed.
To ensure the continued operation of the utility and
provision of continuous and adequate service to the
customers.
(item:11:55098, ALJ Marks swears in Pauline Jones, with Channel Oaks WS) Uh, Miss Jones. Yesterday, we discussed your capacity
with the water system and your role as a representative
here today. Given your position, I'm gonna go ahead
and swear you in before we move into your opening statement.
Um, if you'll raise your right hand and state your name
for the record, please. Pauline Jones. Do you swear or
affirm to tell the truth, the whole truth and nothing
but the truth in this proceeding? I do. Thank you. You
may proceed with an opening statement, if you have one.
(item:11:55098, Opening Statement from Pauline Jones, Channel Oaks WS) Um my only statement is that um, uh. On May 11, uh
Mary Maxey with the Channel Oaks Water System, uh the
managing member of the LLC. Filed an affidavit indicating
that Channel Oaks Water System had agreed to work with
PUC. To secure an entity qualified to take over the
Channel Oaks Water System. Um, that Pauline Jones,
Keith Jones and Aaron Johnson, a Class B licensed operator.
Have been identified as the new operators responsible
for managing the utility. Um on May 16th, the PUC
came out and discussed with property owners from Channel
Oak subdivision. The um procedures that would be required
to complete a sale, transfer, merger of the CCN. And
explained that it could take up to a year to complete
that actual transfer over. Um we feel like that we
have identified the individual responsible to manage
the utility and we have not violated the Commission's
final order in Docket No. 54678. Um the Channel
Oaks Water system was never notified, that the PUC
was requesting that the Attorney General bring suit
against Channel Oaks water system for the appointment
of a receiver. Um I personally, Pauline Jones. Met with
Phyllis Brown, who was contracted by the PUC to ensure
compliance on all billing and record keeping issues
with managing the water system. Um I trained with her.
I have been working with Channel Oaks Water System
since October of 2021. When PGMS was managing the
system. And is responsible for all of the violations
that we had leading up to there, uh removal or walk
away from the system. And um I have been instrumental
in bringing the water system into compliance with the
TCEQ, the Groundwater Commission and the PUC. Since
um I took over the water system in February, February
8th of 2023. Um I have been working through the legal
issues. Surrounding the Brian Maxey, DBA Channel Oaks
Water System. That currently owns the CCN. And the uh
max the assets, the assets from the Mac, Brian Maxey
estate were not distributed properly. To the heirs or
beneficiaries before closing the estate. And Channel
Oaks Water System CCN and all assets of the Channel
Oaks Water System should have been transferred out
of the DBA at Brian Maxey's death. Um Mary Maxey and
Carolyn Maxey have both stated that they are not the
owner or the operator of the water system. And Channel
Oaks Water System, LLC has been managing and operating
the water system, and has been providing adequate water
service to water customers. Um We are committed to
continuing to work directly with the PUC. To secure
an entity qualified to take over the CCN. Thank you
Uh We'll move into the witnesses. (item:11:55098, Commission Staff and Channel Oaks WS state they do not have any witnesses) Commission Staff
do you have any witnesses? No, we do not. Ms. Jones,
do you have any additional witnesses? No, I do not.
Thank you. Commissioners, do you have any questions?
Yes. I, I have a few questions. Oh, sorry. You said
Commissioners. Oh, I apologize. (item:11:55098, Commissioner McAdam's has a question for Commission Staff) As to the issue of notice um are, are they
required to be noticed? No. Okay.
There will be (inaudible) one of the petition to appoint a reserve
as follow. I understand. Yeah. Okay.
Any other questions, Commissioners? I don't think so. Um, we'll move into
closing statements.
(item:11:55098, Closing statement from Mildred Anaele with Commission Staff) Once again, um Commissioners. We are requesting that
the Commission issue an order to appoint TSWR as
temporary manager until the receivership process is
concluded at the appropriate court. Uh the evidence
on the record, shows that COWS failed to comply with
the Commission issued order uh, in Docket 54678. Not
once but twice. Um which require COWS to identify the
appropriate individual. Um they state that they did
but they did not specifically say who was to manage.
They listed people, but they did not list who was the
manager. Um
because of the continued ambiguity, uh ambiguity.
Um that remains as to who is in charge um of ensuring
the as who is in. Sorry. Let me restart that. No problem.
Um because of the continued ambiguity that remains
as to who is in charge. Of ensuring the continued operation
of the utility and the provision of continuous and
adequate service to the customers. And because CSR
uh, CSWR stands willing and able to temporarily manage
COWS, and for the benefit of the customers in general
Commission Staff requests that the Commission issue
an order appointing CSWR as temporary manager of COWS,
effective today, June 15, 2023. Continuing until the
Commission orders otherwise or until a receiver is
appointed. Thank you. Miss Jones, do you have a closing
statement? Yes. (item:11:55098, Closing statement from Pauline Jones with Channel Oaks WS) Um my only statement here. Is that um
in February, CSWR we spoke with Sean Nichols and
uh tried to have him take over the temporary management
and operation of COWS. Um when, when he contacted Ms.
Maxey back in February. Um they could have saved the
homeowners and myself a lot of time and energy. But
they were not willing to provide a licensed water operator
or take over the management until they owned the utility.
It is now in the statement from the uh that, that's
in the docket. That Mr. uh Todd Thomas intends to purchase
Channel Oaks through a STM proceeding. With the
PUC, um he made that statement on June 1, in the
docket filings. And my question is this if, if he is
interested in purchasing in doing a sale transfer
man, uh merger. Then why not allow us the opportunity
as the water system owner of the CCN for the
last 20 years. Although the PUC states that we don't
own it because it's in Brian Maxey's name, instead of
the LLC. Why not negotiate with us and let us. We're
more than happy to do a sale transfer, merger and sign
it over to CSWR. But I don't want to give
it away. And if it's gonna go into receivership, then
so be it. But I don't feel I need a temporary manager,
to come in here and take over my business and run it.
And for the property owners, I am providing that service
for the property owners. I have been billing, I have
put the TCEQ charges. I have done everything that
the Public Utility Commission has asked me to do. And
I don't see any reason. If they take it over with receivership,
then so be it. We'll turn it over. But I don't see
any reason to authorize them to come in and take over.
And do what meter readings and billing? We're already
doing that. So that's my statement. Thank you. If there's
nothing else from anyone? One question of Staff. Has
service meaningfully uh improved since this entire
process began? I would like to ask um Celia (inaudible)
to also step up. Great. But she'll have more information.
Good morning. Will you please state your name for the
record? Celia Eves for Commission Staff Division
of Utility Outreach. I'm gonna swear you in as
a witness. Uh, please raise your right hand. Do you
swear, affirm to tell the truth, the whole truth and
nothing but the truth in this proceeding? I do. Thank
you.
(item:11:55098, Commissioner McAdams' follow-up question to Commission Staff) Has the question is, has service meaningfully
improved since the PUC process was initiated? (item:11:55098, Celia Eves with Commission Staff) Since the
the PUC process, uh since we've uh have been working
with the utility and stuff. You know, we, we have sent
since Ms. Jones stated uh assistance contract. There are pending
violations that we are aware of that are still pending
with the Texas Commission on Environmental Quality.
Um that I believe are, are still relevant issues at
hand with regards to the continuous um an adequate
service related to providing service to the customers.
Um Ms. Jones stated that we, the division of utility
outreach, as well as our public engagement, Mike Hogan and
stuff. We actually attended a meeting, held a meeting
with the customers of Channel Oaks Water. With regards
to um a lot of, I guess concerns from the customers.
About reliability, about understanding, about not understanding
what was going on. But as well as issues with regards
to how billing was occurring. As well as you know,
who they needed, who was going to respond to specific
requests for service. So there's a lot of, I guess
customer concern with that regard. We actually attended
that meeting. To try to make sure that we would clarify the
PUC's jurisdiction. With regards to trying to work to
ensure that there's continuous and adequate service.
With regards to the fact that because there is an entity
or someone out there. Representing that, you know, they
are providing service for compensation. There's still
the issue that this entity does not hold the CCN to
provide service. And as the record will show, what's
In the docket and stuff related to Docket 55098.
And it's actually Item No. 2, Exhibit 2 and
3. If you look at those exhibits, I think this
is part of the concern. With regards to trying to determine
what is going on and how we actually reach meaningful
resolution for the customers. And ensure that there's
continuous and adequate service. There's been a lot
of unfortunately, in the emails was very lengthy email
chain that's in that exhibit. With regards to who the
owner is. The Maxey family has had an ongoing dispute
about who actually is responsible for the utility. And
who actually has the authority to potentially sell
the assets of this utility. So the Division of Utility
Outreach, we have reached out to numerous neighboring
utilities. With regards to either doing temporary management,
interest in the utility. But the question remains that
even if we were to identify someone, potentially. There's
still the issue of who would be authorized to actually
transfer the assets. And because of that, you know
there is concern. That are we going to have someone
in place again to even address the transfer of the
utility. But also address even some of the violations
that are, that are related to what might be considered
significant infrastructure improvements. For instance and again,
this is not PUC, it's a Texas TCEQ compliance violation
with regards to well capacity. So there are improvements
there are issues. With regards to whether the lines
are actually, that the lines actually are not properly buried.
And so there's obviously infrastructure upgrades that
need to be included and conducted with this utility.
So it's important to identify someone who's actually
going to have the ability to actually make those infrastructures
improvement. To ensure that there's going to be continuous
and adequate service to these customers. But again,
with regards to trying to work to find a long term
solution. You know, it potentially is again, someone
needs to have the authority to actually hold the CCN.
To legally be charging these customers and actually
have the ability to invest in the needed infrastructure
to ensure this continuous inadequate service.
Anything else? Thank you Judge. (item:11:55098, ALJ adjourns hearing) And we are adjourned. Thank
you.
(silence)
(item:11:55098, Chairwoman Jackson calls to adjourn merits hearing) Merit's Hearing in Docket 55098 is hereby adjourned
at 10:12am.
(item:11:55098, Chairwoman Jackson reconvenes open meeting) We will now reconvene the open meeting of the Public Utility
Commission at 10:12am. Resuming with Docket No.
11, with item 11, Docket 55098. Um, given what we've
just heard, does anyone have any thoughts on this
uh or a motion?
(item:11:55098, Commissioner Cobos' thoughts on the hearing) Commissioner McAdams, thank you for asking those questions.
I think it highlighted a lot of very important information.
Um and, and thank you Sheila. For your um feedback
I think, you know, there's. And I appreciate the deep
desire by um, Ms. Jones. And to want to continue to
operate the utility and, and, um you know their,
their efforts and hard work. That they've you know
put forth in trying to maintain this um, utility and
and service to the customers. It just appears that
there's still a lot of underlying issues here. With
respect to the, the law and legalities of who, who's
the CCN holder. And that's a fundamental issue for
us, right? To ensure that we have a clear CCN holder
that can um, be you know responsive to the Commission.
That can um be responsible for um providing service
to the customers, continuous and adequate service.
All of those are very important um fundamental issues
for the Commission to consider. And you know, there's
obviously issues out there on um infrastructure and
the well. And, and I think our primary consideration
here is to ensure that these customers have continuous
and adequate service. And um that, that's where I will
come from with respect to reaching this decision. Even
though it is a difficult decision, I respect the desire
of, of the family and everybody to maintain the, the
utility. But I think ultimately, I, I think I would
be in favor of um appointing a temporary manager, uh
CSWR Texas. To, to get us in the, in the
right path forward um with, with these uh utility and
the services and, and for the customers that are being
served in this area.
(item:11:55098, Commissioner Glotfelty's on the hearing) Yeah, I think I'd fall in the same area. Emotionally
I, I think uh what the residents have done to pick
up. Uh you know, a pretty challenging situation um
is. I'd love to side with them to keep doing this until
the court decides. But I don't think by law we can
do that. I think our obligation is continuous and adequate
service. That the law is very clear that our responsibility
is to the consumers, not necessarily to that owner.
And that uh you know, hopefully CSWR ends up doing
a sale, merger, transfer and buys it. And in fact, if
they become the temporary manager, they're going to
get a head start on that by upgrading the system. And
it's clear that with 6000, 6000 connections uh nearby.
That they do have the adequate ability to run the water
system. So um I, I'm supportive of uh of um appointing
CSWR as a temporary manager. And that it should be
indefinite since this is not an emergency. That 180
day temporary managers is not applicable. And in fact
I can go further and say that, you know, I believe
that they should be paid $15 per water connection per
month. And that we should waive the requirement regarding
the temporary manager's duty to post financial assurance.
And that we should direct OPDM to draft an
order consistent with previous Commission orders and
our discussion. Boy, that's framed very much like a motion. And I would, yes. The was the only thing
I would add. And I so move. Well, the only thing I would add is I
wanna, I wanna take notice. That um the utility has
been referred to the Office of Attorney General for
appointment of a receiver due to its violation of a
Commission final order. Yeah, absolutely. Look, um
(item:11:55098, Commissioner McAdams' thoughts on the hearing) Madam Chair, if I may. Where I fall on, this is my
my question was somewhat leading. Uh when there is confusion
about ownership and um the processes of business. At
the end of the day, we fall back to that overarching
mission in the water code, continuous and adequate
service. It is an essential service. Water service
is not something we should take any more lightly than
electricity service. And, and so there has been ample
room in the regulatory timetable. To try to address
some of the deficiencies highlighted by these residences,
by these consumers. And, and so I think in an effort
to comply with our overarching mission, I would support
the motion proposed by Commissioner Glotfelty. So if
if that was a motion, I second that motion. As amended
by Commissioner Cobos. In recognizing the Attorney General's
actions. (item:11:55098, Motion on amendments from the hearing) Okay, very good. We have a motion and a second.
All in favor, say aye. Aye. The motion passes.
I don't have anything on Item 12, unless y'all do. Um Item
13 was consented. I don't have anything for Item 14.
Okay. Next up is Item 15. Mr. Journeay, will you please
lay out this item? Are we gonna take that up later
Madam Chair?
Or alternatively um, if you wanna take it in order
we would request that you take a short recess. Okay.
Well, we can move on and go to uh Item 18.
(item:18:54957, Settlement agreement relating to the City of Austin, dba Austin Energy) Item 18 is Docket 54957. It's a settlement agreement
relating to the City of Austin, doing business as Austin
Energy. Uh violations of PURA, Commission rules and
ERCOT nodal protocols. That are related to scheduling
operation and generation resources. A proposed order
was filed on May 12, and I have a memo with proposed
changes to the order.
Have any thoughts on this one? Uh I'll take
this one if I can Madam Chair. Um
(item:18:54957, Commissioner McAdams' thoughts on settlement agreement) there is an issue I believe the Commission must address
before final approval of this order. Primarily, whether
it is appropriate to utilize a different methodology.
Uh to discourage excess revenues collected by Austin
Energy, other than the default method. Which currently
exists in Commissions Rule 16 TAC 22.246, Subsection
K. Uh based on the party statements um and ERCOT's
memorandum indicating support for a different distribution
method. I believe it is appropriate for the Commission
to direct Commission Staff to open a subsequent proceeding
to address this issue. Um I'm certainly open to further
discussion amongst my colleagues. However, if everyone
is in agreement, I have a motion. Ultimately, I believe
ERCOT is, is certainly an organization that is manpower
constrained. Um we want expeditious um uh resolution
of this issue. Um for the money to, to be appropriately
transferred. Uh if, if there is a quicker way um then
we need to establish what that looks like. Um and,
and that's kind of where my thinking is on the topic.
Would welcome any input.
I'm in agreement. Okay. Uh if you would entertain a motion
Madam Chair. (item:18:54957, Motion to approve order as modified) I would move to approve this order as
modified by the Commission Counsel memo and our discussion
today. Uh and require Austin Energy to disgorge the $23,462.53
in excess revenues to ERCOT. And direct Commission Staff
to open up a second proceeding. To determine the appropriate
methodology to distribute the disgorged excess revenues.
Second. We have a motion and a second. All in favor,
say aye. Aye. Motion passes. We don't have anything
on Item. I don't have anything on 19 or 20. Uh, 20?
Is, is that what we're talking about? 21? Got it, got it.
Thank you. Okay. So next up is (item:21:53298, Chairwoman Jackson lays out discussion points on reliability standard and bridging) Item 21 our wholesale
electric market design implementation project. Uh we
have two topics that we're going to discuss today under
this project. The reliability standard and bridging
solutions. Um let's talk about the reliability standard
first and then we'll move on to bridging. Uh we have
uh Woody Rickerson here with ERCOT. To provide us a
preview of his presentation to the ERCOT Board on the
reliability standard study, preliminary results. This
is Project 53298.
Um ERCOT is seeking confirmation from the Commission
that we are aligned with their analytical approach.
And so we can move forward and develop a list of future
resource, mix scenarios for our evaluation. Uh thank
you so much, Woody for being here today. Um and giving
the presentation. (item:21:53298, Woody Rickerson with ERCOT, previewing ERCOT Board presentation) Morning Commissioners. I'll run through
this very quickly. So if you uh put it on Slide 3.
The uh the, the study is centered around the year 2026.
So it uses a resource portfolio from the CDR that's
based in 2026. So that would be all of our existing
generation. Plus any new generation that meets the CDR
standards for being implemented. We um we did limit
wind, solar and batteries to their ELCC, their effective
Load carrying capacity. Which is different than the
CDR. And then we also uh remove some thermal capacity
For the sake of modeling. So that we could have a range
of results in the study. And we added in a combustion
turbine capacity. To give us 24 different reserve margin
levels.
And then we evaluated each of those 24 levels for frequency
duration and magnitude of events after running a Monte
Carlo simulation. So that's the uh that's an overview
of the preliminary results. If you look on um and like
I said, these are all based on the frequency magnitude
and duration framework that we've discussed before.
On Slide 5, you'll see an overview. So we didn't
provide all the results. We provided 5 of the 24
scenarios and those are highlighted on Slide 5.
And then Slides 6-10, provide the details
for each of those 5 scenarios.
And you can see as reserve margin increases the, the
frequency of events becomes less frequent, frequent
that you have in events. And the duration of
will also go down, which is what you would expect as
the reserve margin goes up. And that's illustrated
in those Slides 6-10. And then the last part of
the, the preliminary results was uh Slide 11. It talks
about an exceedance probability. Exceedance probability
is simply for each of the scenarios you can take the
events. And an event is when the Load exceeds the capacity
of more than 1000 Megawatt. So it's a, a Load sheed
event. You take for each of the scenarios, you would
rank the events, from the most impactful to the least
impactful. And then one way of dealing with the most
impactful events is you can have an exceedance probability.
Where you can say I'm willing to overlook 1% of the
worst events or maybe 2%. And that's one way of dealing
with these outlier events and a probability distribution.
So you're gonna have some tail events that are much
worse than the vast majority of the results. And so
part of the study is how do you, how do you deal
with those? Now, one option is to say we're gonna include
all of them, that's an option. And so that would be
an exceedance probability of zero. We're gonna include
everything. A 1% would say we're going to take out
1% of the most impactful and build our standard below
that. You can think of that 1% as a 1 in 100
year event or maybe 2%. And so that's what we're, uh
that's where we are at this point. Is we produce these
preliminary results. We're ready to, to go forward
with some more robust analysis. We'd like to have confirmation
that the duration, frequency, magnitude framework that
we're using. Is, is what we want to continue to use.
And then we'd like to be able to bring back some of
these scenarios and including the scenarios and different
exceedance probabilities at different reserve margins
and bring that back. And with those include cost, the
cost associated with adding the capacity necessary
to make each of those reserve margins work.
So that's, that's what that's the guidance we're asking
for at this point.
Woody?
(item:21:53298, Commissioner Cobos' thoughts on ERCOT presentation) Thank you so much for this preliminary overview of
where, where you're headed. Obviously, this is important
um work. We are required to set a reliability standard
both by Senate Bill 3 and now, you know, House
Bill 1500. Is definitely in alignment with this as well.
And it's very important that we do a very robust review
of the reliability standard. And I think that moving
beyond just the 1 in 10 is very important. And I
think that's the effort that you're trying to move
in that direction with respect to duration and magnitude.
And also I think you have referenced in here, you're
also looking at energy sufficiency and you can look
at unexpected expected, unserved energy. Which is also
important. That is a, a metric that many of the ISOs
out and nationally are looking at as well. Um with
respect to the um
I guess the, the overall direction. I, I think I'm comfortable
with, with those metrics. And, and they're very capacity
driven. But I think looking at the energy metric is
also important. Um the exceedance probabilities, I think
we can spend some time deliberating on that. Um but
um how will you come up with the cost of the different
reliability standards? (item:21:53298, Commissioner Cobos has dialogue with Woody Rickerson of ERCOT) ERCOT methodology
of, of determining what the different metrics will
cost? Well, the different levels required a different
reserve margin which requires capacity to be added.
And we'll go back to the E3 study and align our
results with the E3 study where it talks about
the, the cost to add additional capacity to the market.
Yeah, that, that's what I'm wondering. Um okay, so
that, that's an interesting perspective on that. So
when you say going back to the E3 study, what
exactly are you referring to? We'll make sure that
our cost estimates for additional capacity are in alignment
with what E3 did? Okay. So are you talking about
the cost of new entry and the 935 for a CT?
Yes. Okay. So that, that's where I think we need to peel
back a little bit. Because I think based on a lot of
discussions that happened this Session. That, that number
may be drastically low. Um and I say that because um
our number in the protocols is 105,000. And I
know that ultimately, a lot of markets out there conduct
an extensive cost of new entry study that they do on
a periodic basis. And update in the interim along the
way. Because the cost of new entry figure is based
on deep analysis of capital costs, labor, equipment.
These days, you'd have to take into account inflation,
supply chain. So I, I'm just I'm a little bit, you
know, because also House Bill 1500. Requires us to go
back and calculate across a new entry in the net cone.
I think that it's, you know, we gotta be careful about
what we're using as cost for those metrics. And so
I just want to provide you with that perspective. Because
we have now House Bill 1500 that says we gotta calculate
a net cone. And then we have all this other data through
our extensive deliberations and, and look at cone. That
we have to take into consideration. So um I know that
the E3 study has some figures. But I'm not sure
that those are gonna be the exact figures from my perspective.
Well, we'll be very transparent in what we use and
we can adjust that. That's almost almost an outcome
of the study. It's not a uh it's not an input to
the study. So as we look at the different reserve margins
and we bring back to you different frequency durations.
Um
when we provide those, it will come with a amount of
generation that needs to be added to achieve that.
And then fixing a price to that is something uh obviously
we'll be very transparent on what we use and we can
change that. And I think you also uh it's gonna be
tricky, because um there will be some generation retirements.
And so uh the amount of generation that has to be added
to attain a certain frequency magnitude and duration
will be affected by obviously what retires in that
same time period. And so I think there's gonna have
to be a lot of thought going into uh what do you
include in those final numbers as far as the additional
capacity. Because some generation will inevitably retire
and you have to replace that as well. Because of? Well
for various reasons, some of this generation is very
old, there are also some impending uh environmental
regulations that may cause them to retire as well.
So economic and regulatory impacts. So that'll have
to be factored into this. But the, the value of the
study is to say. For a reserve margin, this is the main
two frequency and duration that you can expect for
outages. And it's important to remember that for any
given reserve margin, those numbers will change based
on the composition of the generation fleet inside that
reserve margin.
So I mean, if you have a reserve margin that's composed
the extreme would be all solar. Lower accredited units.
All solar, you're obviously with nothing else, you're
obviously gonna have a lot more events. Because at night
you would have uh you know, outages every night. So
the mix of generation that's in there is, is an important
part of the reserve margin. And as we go forward in
the future and then the portfolio mix changes, we'll
have to continue to do this study. To make sure that
we account for the new portfolio mix that's in there.
(item:21:53298, Commissioner McAdams has dialogue with Woody Rickerson of ERCOT) So, so Woody uh just a kind of technical question for
you. On, on Slide 12. When we look at those uh, uh
exceedance probabilities. Um I assume on, on your dot
plot chart. Uh the dot way to the right, way up top
uh is Winter Storm Uri. That's at 15 hours of duration
and uh 19,000 Megawatt hours of unserved energy. Actually
that, that event would more closely be associated with
the 2011 storm. That's 2011. That's my question. Okay.
So that's a 1% exceedance probability event. And so
what I want to be very clear about what. The treatment
of Winter Storm Uri in this, in this time. So we even as you all
know, we have implemented the weatherization standards
since Winter Storm Uri. So how do you account for
the effect the winterization efforts? How do you account
for that in this study? So if you just use Winter Storm Uri
as a historical marker. And put it with 2011 and you
completely ignore the weatherization effects that are
the effect the weatherization standard has had on reliability.
Then you're going to, these graphs would look much worse.
So Winter Storm Uri was left out that 72 hour outage
of 20,000 megawatts, it's not in here. Because we included
the weather. We, we, we didn't include it so that we
would take into effect the, the weatherization that
we have done, but 2011 was in there.
Either way, you've got to, you've got to fill out the
dot plot. Um with, with tail events included for right
now, just so that we may see the concentration on,
on where it's falling. And I think if you look at Slide
17, you can see uh there's an explanation there of
the bottling treatment of extreme winter storm events.
Yeah. So, so how, how do we quantify what the next Uri
is? That includes our weatherization and the weatherization
of the pipeline system?
What is that 1 in 100 year event look like? That's part of
the next steps in the study. Is, is taking direction
on, on how to account for, how effective. Not only the
weatherization of the plants, but also the weatherization
of the gas delivery system in fuel. And firm fuel. And firm fuel is
another one. Exactly. So those will need to be factored
into this as well. And so those are all subsequent
areas that have to be factored into this. So these
were preliminary results. That kind of gives everyone
a feel for what we can produce? What the model can
produce? Um how the framework would work. Um how are
the, the different legs of the framework relate to
each other?
So point of clarification, I was you know, flipping
to page. The Slide 12 very fast and didn't quite catch
this picture. (item:21:53298, Commissioner Cobos has follow-up dialogue with Woody Rickerson of ERCOT) But, you know, Commissioner McAdams
um was asking about the outlier with the 1%. So you're
saying 2011 was falls in the 1%? 2011 would fall
in that 1. No. Well,
so I need you to be accurate on that Woody
2011 event influenced all of these results.
Sure. Okay because it, it created the outage rates that
were used in the Monte Carlo simulations. Okay. So it's
the 2011 event is not modeled as an event in, in this.
It's not gonna show up as a single dot here. You can't
look at a single dot and say that's the 2011 event.
The 2011 event influenced all these events. If we had
included Uri, it would have influenced all of these
events as well. So I can't look at a single dot and
say that one is that single event represents Winter
Storm Uri. I can show you events that were similar
to Winters Storm Uri. But so, so that when you do
run the Monte Carlo simulation, you're running uh random
draws from a bunch of different things and some of
them produce events and some of them don't. And then
when they do produce events, we chart it. (item:21:53298, Commissioner McAdams has follow-up dialogue with Woody Rickerson of ERCOT) But in, in
your view, the exceedance probability most closely
aligns with a 2011 in the 1%, uh range
of the simulations. Again, given the type of failures
that were experienced and the type of weather conditions
that were present. It would depend on the reserve margin.
So for any given reserve margin, you can have a 1%
exceedance probability. So if you're looking at some
of the high reserve margins maybe uh like you see
on
Slide 10. Which is a reserve margin that produces a
loss of Load event once every 143 years, which is a
very high reserve margin. Uh the 1% of events that
would be excluded by 1% would be much less. Than they
would be at a uh a very low reserve margin. Like on
Slide 6, where you have a reserve margin of 9%. Right.
So that's the way to look at those that 1% exceedance
probability. Now, if you were to go back and look at
2011 and say, let's have a reserve margin that looks
just like what we had in 2011. Then I could relate
it to the actual event to, to adopt that uh would be
correspond with the 2011 circumstances. Well, that's
not included in this study. Can, can you contextualize
at this point, I won't press you too hard. Uh to a
0.1 loss of Load equilibrium event which you
have modeled here. At somewhere around 18% reserves
Uh again at 2026. And then the CDR we're showing we're
gonna have 44% reserves in 2026. So look at slide um
it's in the appendix. Yeah, I saw it. It's like 18.7.
So those CDR says in 2026, 42.4% reserve margin. But
now if you factor in the ELCCS for wind, solar
and batteries. That drops down to 18.7%.
So remember we can't use ELCCs in the CDR
yet because we haven't changed the protocol. Right.
So if you adjust the CDR 42.4% reserve margin to use
ELCC, then you get 18.77% which is very close
to Slide No. 8. So we're meeting our standard?
We're almost sticking the landing? Right. And I think
the important part to look at when you look at Slide
8. Which is effectively what we'll have in 2026
is look at some of those outlier events are those outlier
events acceptable. Is that the magnitude of what you
see there is that acceptable? And this is something
we've always had at a 1 in 10 reserve market. And
that's why we are moving to this new framework where
we think about duration and we think about magnitude.
Because frequency by itself has always at, at a 1
in 10, we've always had these outlier events that were
possible at 1 in 10. So this now informs us what
the magnitude, what the duration of those events could
be.
(item:21:53298, Commissioner Glotfelty has dialogue with Woody Rickerson of ERCOT) I, I have a couple of questions if you don't mind.
Um so uh I, I appreciate uh what you're doing here.
I mean, I think y'all are um challenged with this just
like every other part of the country is and I appreciate
your work. And uh, uh I, I feel like you must be
the weatherman. Where you're gonna get it wrong 100%
of the time. But uh, we won't hold it against you.
I promise you. It's a uh this is a academic exercise
to figure out how we set the policy and I appreciate
your efforts. Um is the CDR, the right beginning spot
for this? Yes. Are all the inputs on the CDR, the right beginning
for this. I believe. So. I mean, the CDR takes into
account a generation that hasn't been built yet. That
has a pretty sure chance of being built. Um It's our
best weather forecast. Our, our best Load forecast
going forward takes into account all the growth that
we know of. Does it take into account a certain extent
of ability as well, because of the Renewable Accreditation?
It, it does not take into account durability, but we have
rules in place. Oh, sorry.
Go on Woody, I feel like this is a workshop. But we
do have rules in place to make, make sure that deliver
is there for our dispatchable units. And keep in mind we're
talking about, you know, derating the ELCC takes the
uh
wind and solar play numbers well down, right
Okay. Um second question. Um Does this take into consideration
deliverability?
Oh, I think that was answered. Um is uh so I see
in the server model, we take out 8000 megawatts of
coal. Right. And I think there's a question on that
in my mind. And clearly that's a guesstimate based upon
economics and, and epa regulations and such. Um if
we created some sort of a backstop. To keep those megawatts
in? Does that um change the math quite dramatically
do you think? No, I don't think it does at all actually
Uh if you look at um where is that?
There is a uh
slide 18. Mhm. Yeah. So taking 16,000 megawatts out
of the generation stack is strictly a modeling exercise
because we want to be able to produce this table. You
see on Slide 18. That includes reserve margins as low
as 9%. So the only way to do that is to remove
some generation. Okay. Otherwise, if we hadn't removed
the generation. If we kept it all in there, then this
table would only be half as big, it would start at
18%. So we wanted to see what it looked like at 9%.
So this isn't a forecast that 8000 megawatts is gonna
to be removed. It's simply a bottling exercise so that
we can get some low reserve margins and some high reserve
margins so that we can look at the three pillars at
those reserve margins to see how reliability is. I
think that, but, but is it isn't reliability changed
if you have? I mean, maybe you're not, maybe I'm not
totally understanding that and that is you're just
you're just taking out a number, right? So in the model
it's not a um well I, I guess this is my question.
If we're doing ELCC on the, on the renewable
resources. Are we doing some sort of a forced outage
rate on these thermals? So that we get a apples and
apples comparison. Yes. But that will show up, that will show
up in the, in the, in the model, in the, in the
random draws. And so really the difference that you're
talking about is um let's say we take the 2 18% nothing
retires and we have 18.77% reserve margin or we have
8000 Megawatt retire and replace it with C T S. So
those two portfolios are different. One's got old coal
one's got new gas. So they are different. But the E
L CCS for those units aren't that different. And so
the results that we show here in the top half on page
18 are not gonna be that different. They're not that
different though? I mean, when you have rampable. Not,
not when you compare it to in a high intermittent environment
well, you can base Load those units and you still have
the other C T s. And so if we had replaced the
wind with C T s or something like that, then you would
have a, something we'd have to worry about. But, uh
now going forward, we can decide, you can help us decide
you know what that retirement rate should be for 2026
And we're gonna have to, that's gonna have to be factored
into this. You're gonna have to decide, are we gonna
lose 2468? How many megawatts 1000 Megawatt are we
gonna lose? Because I just wonder if, you know, we
think about EPA regulations are there ways that we
could help, uh, manage capital costs for older units
to allow them to run less and meet their EPA thresholds
but continue to remain as part of the fleet when we
need them. And clearly that's getting deep into the
modeling, but clearly will help you think through that
potentially. I think the other thing to keep in mind
is when you think about the year 2026. You think about
nothing retires, we've got an 18.7% reserve margin.
What's 2027 look like it's going down. So even though
we may be at that one in 10 threshold in 2026 the
slope is downward. If nothing else is built, no, no
no new dispatch generations built if, if our market
is static but right. So that's something to keep in
mind because, you know, we're going to be implementing
a lot of, you know, Legislation.
So, um it's important that I think that the, that we
understand this is an iterative process, right? Um
And ultimately, you know, we gotta remain open minded
to that fact, but um I'll let you continue, I just
have two very quick things. Um One of them is uh are
you seeing any evidence around the region around the
country that um the net number should be batteries
instead of CTs? I don't have information on that.
And I'm just wondering, you know, is that I'm thinking
ahead, is that the future, is that good? Is that bad?
Is that information that we should be discussing? Clearly
a battery has
a dispatchability time frame. That potentially a CT
not consider. So I'm just, I'm asking the
question because it's clearly something that's gonna
be addressed in the future. And then the last question
that I have was. Um so if we get this and we
talked about this on the phone so this. Um I, I if
we get this reserve margin can we use that reserve
margin and take the next step and do an economically
optimal reserve margin and determine what types of
resources are most economically optable in the market?
And I say this because demand response and energy efficiency
and some of these other tools that are out there may
be less expensive and they, they have a duration issue
as well. But can we ultimately take this number and
say, ok, you know, we the reserve margin provides this
reliability metric and this is the economic, economic
um spread of what these resources demand and supply
would look like. Absolutely. I mean, I think that's
one of the interesting things about the exceedance
probabilities is perhaps some of the uh some of the
events that you decide to or outside of a standard.
Could be mitigated by something uh market related.
But that still necessitate a value of loss Load, again
a value of scarcity. And if the value will adjust when
we start talking about different peaks that grow from
summertime hours to the dead of winter, from three
AM to six or nine AM when the batteries have run their
discharge and we are without power. 3AM may be a
great time for demand response until people start freezing
depending on the duration. What, what is the status
of the value of loss Load study? It's on ongoing meeting
Have you hired an independent consultant? Yes. Okay. And who
is that?
It's um I can I, I. Have, have you picked yet? I
think,
I think I know who it is but I can, you haven't
officially hired somebody? Ok. so you, you put out
an RFP and are in the process of hiring?
Ok, great. Um, that's an important piece of all this
as well. Um, you know one, one question because we're talk
I heard you all talk about seasonality, you know, Winter
in Summer. And I think that's an important um factor
that we got to look at and I know that's important
to ERCOT and their evaluation, as I see on page 13.
Um you know, there's an attempt to more accurately
model reliability in the, in the Winter. You know,
I know you started with the CDR report. I'm wondering
as we go through, you know, this evaluation whether
it's through this, you know, reliability standard study
process or future iterations. Um but seasonality is
very important. And how do we, I mean can we look
at the SARA reports. And maybe come up with some kind
of, you know, seasonal perspective on the reliability
standard rather than the CDR? Uh I think the standard
is gonna inform us on, on the, for example, if you
look at slide number 25 so this is our 18% reserve
margin, 1 to 10 year frequency. And if you look at
that graph, you'll see a, a duration and a frequency
chart for, I'm sorry, ADER the frequency across the
top and duration on the Y axis. And the different bar
colors represent summer and winter. So you can see
as you build a reserve margin, the uh the summer events
almost go away when you get above a frequency of one
in 17 years. And so it's just the winter events. And
so that kind of this study will, so I guess the short
the short answer is when you look at those dot graphs
those event graphs, we know that those events are summer
or winter events. And so we will be able to focus on
on a seasonal problem. So you will know if you're talking
about a uh a frequency standard, that's one in 25 years
that the events we're talking about are winter events
Now, they're not summer events. I think that's very
important because as we've well highlighted, you know
the winter is, is where the health risk, public safety
risk is. And it's very important we stay focused on
on all seasons, but particularly the Winter.
All good questions, all good thoughts and um just really
appreciate you coming in. (item:21:53298, Chairwoman Jackson's thoughts on the dialogues & thoughts of the Commissioners) And um you know, asking the
questions early on in the process. And uh I think,
you know, kind of one of the objectives uh today was
to uh give you kind of like the green light to move
forward. So that you could put together this list of
scenarios to come back to us. And we could take a look
at it and then um you know, agree that that is the
comprehensive list or maybe add some. That we want to
have different scenarios run to see the different outcomes.
Um but I think the other thing that you were hoping
was um to kind of know that we were in agreement with
the um proposed treatment of the low prob probability
events using the exceeding probability methodology
So I think I can say that we, we we're all kind
of aligned with that. And uh I, I would, you know,
say with that if you kind of feel like you've got everything
you need from the discussion and the green light to
move forward and keep going. I think so. Thank you
very much. Can I ask one quick question on page 19.
You talk about uh uh Load shedding shapes and everyone
has a numerical number except for CenterPoint. It
says depends. Sounds like an engineering answer
but uh any parameters on that. On the, on the CenterPoint?
Yes. I think it, it actually depends on the
circumstances that the event occurs. And they've got
clear rules but it depends. For, for the purpose of
this chart, it didn't fit to put it in there. Okay. So
that's not, that's not contingent upon the water congestion
constraint or anything like that. No. I think it's, it's dependent
on season and things like that. Okay, thank you. Welcome.
Woody, thanks for being here today.
(item:22:5444, Chairwoman Jackson lays the bridging solutions topic) The next topic to take up is um bridging solutions.
Um This is just a general discussion. We don't plan
on taking any formal action today. Kannan with ERCOT is here
and um available. Should we have any questions? And
I'd like to ask him to kindly come up.
Commissioner McAdams, you have a memo. Would you please lay
out this for our discussion? Thank you Madam Chair.
(item:22:5444, Commissioner McAdams’ lays out his memo) Um and, and just for the room and the, the broader
public. Uh I filed the memo um in this docket to give
us the opportunity to refocus and redouble our efforts
after the hard work of the Legislative Session. I also
believe it helps serve the purpose of uh resetting
um as uh the Session has concluded. As we now know what
tools we have available uh in our toolbox. And also
to bring forward um previously filed a suggested frameworks
on reliability standards. Uh as well as um the problem
that we are attempting to solve for in both the near
and long term. And as such a Staff filed a memo in
January 5, 2023. Which did an excellent job in my opinion
of defining the two problems before us. Um and, and
how we consider next steps. First, they identified a
problem of operational flexibility, the current
energy only market design uh with the ORDC retains
and attracts sufficient installed capacity in the ERCOT
Power region, our IMM has repeatedly pointed this
out. However, increased penetration by intermittent
resources, necessitate more operational flexibility
on the part of the grid. And second, they identified
appropriately, we have a resource adequacy problem
in the long term. For which Staff has consistently said
PCM could be designed to address. But the primary objective
of my memo is to outline and accurately identify the
near term problem that we are trying to address. And
that is that presently, ERCOT often lacks sufficient
flexible dispatch generation in real time. To cover
the inherent variability of a high intermittent resource
mix. Increasingly, ERCOT has relied on out of market
actions through reliability unit commitments or RUC
to meet this shortage. And RUCing is not in my view
a tenable long term solution. It is an out of market
action that distorts uh pricing and unnecessarily increases
the wear and tear on aging and existing units. Now
in my view, to address this problem. I would support
the ORDC multi step floor. Which has been recommended
by the ERCOT Board of Directors uh as well as recommended
by TAC. Um in the as a short term solution, the
ORDC operates in, as I said in the memo. As an
economic reserve margin rather than a physical reserve
margin by adding a multi step floor one at 7000 megawatts
as you're working your way down the reserve cadence
of remaining reserves and another at 6500 megawatts
I believe that we are addressing the disconnect between
conservative market operations. Which we are obligated
to maintain in the, in the near term, at least. For
market operations and, and send price signals to generators.
It would establish a clear signal for generators to
self commit and would mitigate risk to those units
that choose to commit for the reasons I highlighted
in the memo. Which are uh fuel variability, fuel usage
variability as a part of existing contracts with their
suppliers. And wear and tear on those facilities, they're
going to be compensated for lighting that thing up
and ramping into the operating day. Ultimately, I believe
that this would reduce rucking once implemented. And
crucially, we are setting the market up to value duration
uh and to further enhance the value of flexibility.
The energy only market has been exceptionally efficient
at uh valuing flexibility. ORDC was a major step
in in that effort um almost 10 years ago, gosh 10
years ago now. Um but the problem that we will face
in the near future. As we just talked about is Winter.
And Winter in a high intermittent environment um with
batteries and their state of charge limitations.
Duration is going to be an important capability that
we have to have in the resource mix moving forward.
To cover that area of darkness, that cold winter night.
As Hannah uh highlighted in their comments under this
uh under this project.
Um
I do not believe that this policy works in isolation.
I believe um that in order to take a step on this
uh component works in tandem with other components
of a broader uh reliability framework that now exist
especially with passage of house Bill 1500 which requires
us to build a uh D R R S program in some
form or fashion. It also works with the Load program
that we will have to build. Uh and ultimately, the
PCM will set us up to succeed in addressing the problems
of operational flexibility and resource adequacy. But
given the uh the conditions of statute. PCM will act
as a capstone uh revenue stream in a revenue stack.
Associated with dispatchable and long duration facilities.
I also believe that um I believe ERCOT is currently
looking at and, and I believe we should look at.
Uh expeditiously deploying, deploying the DRRS required
under statute. Which works hand in glove with this bridge
mechanism. To further incent older more economically
marginal generation to bid into a program to ramp in
as needed. Into an operating day after called upon by
ERCOT. Um I believe we could potentially repurpose
an existing ancillary service such as nonspin. Once
we know more about how ECRS, the new ancillary
service which has just gone live. Um attracts the more
flexible generation into that service, thus leaving
available a tool that we could use um and meet the
legislatures of intent of rapidly deploying such a
service that will have no other effect in helping improve
reliability. So I, I hope I set the table with that.
and would value any thoughts from my colleagues. I
think you did a great job in kind of laying everything
out. And again, just a general discussion today. I
don't think we're planning on taking any kind of formal
action. But um I would really welcome, you know, thoughts
and ideas on this and more going forward. Sure. Um
(item:22:5444, Commissioner Cobos’ thoughts on bridging solutions) I'd like to, you know, just sort of echo some of the
statements that Commissioner McAdams made. I think
you're beating the drum that I've been beaten since
um you know, the beginning of the year, if not before.
And I think you know the, the introduction of the
bridge solution was very important. Um And, and I,
you know, appreciate ERCOT hard work in evaluating
a robust menu of bridging options. And um ultimately
I think from my perspective the, the main goal of
a bridging solution is to help reduce RUC and reliability
unit commitment. The solution should improve generation
self commitment, thereby reducing the need for ERCOT
to have to RUC units. To meet expected electricity
demand and the solution should rely on a market driven
mechanism that can be implemented in an efficient expeditious
manner. Um The reduction of RUC is important as you
as you've highlighted. Um And I've highlighted in prior
memos, um that RUC is an out of market action that
has a distortion impact on the market. And has a physical
impact on our older long duration generation assets.
That are needed to ensure reliability during multiday
extreme winter weather events. Secondly, um the bridge
um by driving generation self commitment in the real
time market. Uh self committed generation units will
receive revenues. That will help cover their marginal
costs, thereby providing revenue stability to help
retain existing generation and incent investment in
new generation. While we await a long term resource
adequacy solution that will be provided by the various
provisions of House Bill 1500. Summarily a bridge solution
should fulfill the objective of stabilizing the market
by sending a stronger market signal to self 10 cent
self commitment by generators in the real time market
and reduce RUC. And I think ultimately, um you know
we have a proposed solution. And um I look forward to
further evaluating in open meeting and taking action
then.
(item:22:5444, Commissioner Glotfelty's thoughts on bridging solutions) Um I, I appreciate the fact that, you know, you put
so much in here. I think I can speak for myself that
I'm still trying to digest what the Legislature has
done the direction they've given us and how that puzzle
fits together. I think it's some of it fits pretty
well together. Some of it has some outliers that we
have to gonna have to figure out. And I think my discussions
with many stakeholders since that time. They raised
some good questions and I'm eager to pose those and
figure out how we can make the market work. Clearly
market, I'm a believer in these markets more, more
out of action, out of market actions. That are corrected
by other, out of market actions are not the way I want
to go. But I think we in this time of uncertainty and
transition, we have to create certainty as best we
can. We've got to lay down that. We think, you know
if RUCing is not the best out of market action. Let's
be specific about how we think we're getting uh that
number to go down. What are the tools we're giving
ERCOT in the market to uh to incent this early um uh
commitment in the day head market. Um these are things
that we have to do for investment. Uh You know, these
are, I'm not saying anything you don't know. But um
I, I'm just I'm eager to get into this discussion.
I think we've got a lot of uh runway here to um
to work on. And uh we got a lot of work that
we have to do. So, uh I look forward to getting into
all these discussions. You know, here in the, in the
coming months. You, you know, (item:22:5444, Commissioner McAdams’ follow-up thoughts on his memo) Madam Chair before, uh
you probably lend your thoughts. I, I would also like
to point out one point. Um we engage uh to a great
deal with the financial and capital market. To try
to understand what we as regulators are thinking. And
what they are thinking in terms of good investments
and return on investment. And um I wrote the memo in
the way that I did. So that it, it can speak to
a broad audience and trying to understand what is happening
here in ERCOT. And we are at the forefront of a major
energy transition. Uh renewables are here and they
are more are coming. And so the effect that that is
having is that the driven operator, ERCOT is having
to do more. To harmonize the flow of power with a what
is increasingly becoming a dominant variable uh a
resource mix. That is dominated by variable resources.
And so I'd like to point out that costs associated
with each uh component of this framework, um ancillary
services. And uh well frankly, right now RUCing. But
those are certain to uh remain in the future. And when
I say costs, I mean, revenues for specific types of
generators to help meet that need um to help address
the variability of, of a renewable heavy uh resource
mix. That that is the new target. Um that is the new
signal to financial markets that investment is needed.
Because and it, and they're unavoidable, we can't get
get around them. They are the new reliability standard
which capacity markets have so often debated. We don't
have a capacity market in Texas, but we've got a heck
of a lot of renewables. And so revenues associated with
managing this are only going to increase into the future.
And uh and the duration limitations of batteries are
a major constraint on their ability to provide the
the answer to the overall problem. And uh and that's
why this is uh this framework is a problem of the sum
of all parts. Uh solving for that reliability standard
which we're going to settle upon. I think that's right.
(item:22:5444, Commissioner Cobos’ follow-up thoughts on the memo) The operational flexibility issue that we're facing
with more renewables, especially solar coming on the
system. Is the more is a very near term issue we've
got to solve for. And filling that gap as the solar
duck curve becomes more of a canyon as I've read in
various um thought institutes putting out analysis.
And that canyon is going to be filled by quick starts
and batteries and and hopefully we'll send the signal
not only for quick start investment, but also for additional
battery investment and technological innovation. To
increase from two hours to, you know, four hours.
And filling in that gap and, and hopefully send a signal
not only to quick starts and batteries, but also to
solar to show up with batteries. In a collocated fashion,
where they can participate in ECRS and other ancillary
services that ERCOT has to offer. And I think ultimately
as you're saying. As we send us, as we invite the investment
community to look at our market. There are a series
of revenue streams that are not going to go away. Um
our real time market energy streams that we're in bolstering
with ORDC at this time. Um and are going to
evaluate a bridging solution that could potentially
bolster the ORDC in the real time market. So real
time energy um revenue streams, but also the consistent
um and expanded and optimized ERCOT ancillary service
portfolio and other market design and market revenue
stream offerings from House Bill 1500.
Thanks for agreeing. I appreciate it Lori. That in a very
long winded way. I just told you I, I'm in agreement.
I think this has been a very robust discussion. And
you know, our North Star continues to be reliability.
I like to tell folks whether you are a consumer, whether
you're residential, whether you are industrial or business
reliability is key. And I think there's no doubt that
um Texas has the talent, the resources, the spirit
um engagement. I mean, I'm from Beaumont. I think back
to January 10, 1901, when Spindletop flew in and
provided at that time, more oil than the world had
ever seen. And really changed the face of, of the nation
and the world. And you know, Texas was at the forefront
then has continued to be since then. And I am very
encouraged by what we've heard today. The resources
that we have uh from um from ERCOT, from our Staff
uh from the talent of my fellow Commissioners, from
the stakeholders. Everyone that is uh keyed up ready
to go. Um we've heard from the Legislature and to,
you know, start moving forward with um with bridging
with reliability. And all the many things that we need
to do. And recognizing again that they all work together
and that working together collaboratively. Drawing all
of the on the talents and the resources. You know,
not just that physical capital, but that human capital.
Which I think is um is, is so unique to Texans and
um so great discussion. Uh I know uh
uh Kannan is here from ERCOT. And I didn't want to kind of leave
this topic until maybe I ask you the question. Is there
anything else from maybe your perspective that you
think we might be needing to think to think about?
Um so before I came here, I was trying to think of
what would be the one main point I would want to share
with you. And um you've all kind of covered it. So,
uh you made my life really easy. Um and that is that
this is gonna be a complex uh problem to solve with
lots of interactive dynamics. Um and uh if, if you
try and just kind of do one thing, it might tie your
hands as far as other uh other measures, you want to
take. So I really appreciate the leadership about wanting
to tackle this as a multifaceted problem. And Commissioner
Glotfelty comments of trying to avoid stacking up things
to fix what the first item did poorly, but it did other
things. Well, that would be, I think a really good
approach to try to avoid that, that type of activity.
So um you're gonna get bombarded in the next few months
with lots of data around the reliability standard.
Um how best to reduce RUC? How best to attract new investment
into the state? And you need to contemplate all of
the elements that are in the Legislation. As well as
um the feedback that you get from our analysis to come
up with an optimal solution. I think uh Commissioner
McAdams memo captured that perfectly. Yeah,
thank you. Um, with that, are we ready to take up Item
No. uh 15? May I suggest that we go to closed session
first? Yes. Ok. Um (item:33:Chairwoman Jackson pauses Open Meeting, to hold Closed Session) this brings us to Item No. 33
closed session. Uh having convened in a duly noticed
open meeting. The Commission will now at 11:12 on June
15, 2023, hold a closed session pursuant to Chapter
551 of Texas government code sections 551.071, 551.
074 and 551.076. And we'll be back in a few minutes.
(item:33:Chairwoman Jackson concludes Closed Session, Public Meeting resumed) Closed Session is hereby concluded at 11:44am on June 15,
2023. And the Commission will resume its public meeting.
(item:33:Motion to request Attorney General file a petition to TX Supreme Court of Appeals) Having met in closed session. I'll entertain a motion
to request the Attorney General file a petition for
review with the Texas Supreme Court of the 3rd Court
of Appeals decision in RWE renewables, America's LLC
and TX Herford Nguyen, LLC versus Public Utility Commission
Case No. 032100356CV. So moved. Second. I have a,
I have a motion and a second. All in favor, say aye.
Aye. Motion passes.
Next up is Item 15. Mr. Journeay, will you please lay
out this item?
(item:15:53601, Application for Oncor Electric Delivery Co. to change rates) Item 15 is Docket 53601. Application Oncor Electric
Delivery Company to change rates. Uh motion was for
rehearing was filed by multiple parties, multiple parties.
Excuse me. And Commissioner Cobos had a memo. Commissioner Cobos,
will you please um walk us through your memo? Thank
you. Yes. (item:15:53601, Commissioner Cobos’ lays out her memo) So um my memo provides proposed changes that
would make the Commission's order on rehearing more
accurate, clear and consistent with prior Commission
orders. I will note that um based on a late morning
um identification of, of um some language um for finding
a fact 282. In my memo on page 5, I would
like to make a um clarifying question and that is um
where the fact say states. Oncor's FERC account 368 capacitor
cost should be allocated on the basis of NCP demand.
To um I would replace its retail delivery with to all
rate classes. That is a, a change I'd like to make,
to make it consistent with the rest of the order.
I thought you had just gone OPAC on us. You know,
like there's always a part of OPAC in me Will.
I'll entertain a motion to grant rehearing. (item:15:53601, Commissioner Glotfelty's thoughts on remand) Can I talk about
one thing real quick about this, about the, the remand
issue. And the um so there are two parts of this, these
remand requests that I think are really right for us
to discuss, discuss. And, but they're not in this docket.
Um I think the proposed interconnection timelines that
Pioneer and TARGA have proposed are really important.
As we continue to grow the system. Um I do not think
they should be specifically targeted towards, to Oncor.
We ought to have that broader discussion on a statewide
basis about how we ensure that interconnection process
facilities are paid for in an open and transparent
way. So similarly, with the DESR provisions that
Hunt had requested. Um it would be great in my opinion
for us to adopt this remand. Um but it would only apply
to one utility and that doesn't solve the problem throughout
the state. So as we continue to work down this effort
with our DESR rulemaking. I think it's important
that we take that up expeditiously that it doesn't
apply to just one utility as it would if we had have
modified it here. But that we address that for statewide
issues and uh try to create clarity. So and one
thing that I, I meant to say on the, the Pioneer
and TARGA remand. Is that um, uh the Hunt Energy, we do have
a docket already. Uh going down the road discussing
DESRs, uh where this can be addressed. At
some point in time here, um towards uh we, we're
gonna open up Section 25 of our code to um uh to address
transmission issues. That's where their interconnection
timelines and things would be addressed. So, uh I'm
hopeful that uh we can address some of those uh this
year. Uh in a rulemaking when we open up Section 25.
And, and my understanding is that is moving forward.
So, so we, we should be able to see something soon
produced from that. So I, I don't think Commissioner
Cobos has to worry about any changes to her proposal.
Absolutely not, I am fully in support of your proposal. I appreciate
the comments, Commissioner Glotfelty. Um with that,
(item:15:53601, Motion grant the party's hearing & make changes to the order) um I would move to grant the party's motion for a hearing
and make changes to the order, the Commission's order
on rehearing, consistent with my memo. And your discussion.
And my discussion. Second. My 2nd changes there. Including
the changes you. Yes, including the changes. And we have a motion
and a second. All in favor, say aye. Aye. Motion passes.
(item:33:Chairwoman Jackson adjourns meeting) There being no further business to come before the
Commission. This meeting of the Public Utility Commission
of Texas is hereby adjourned at 11:49am.