PUCT Staff File Testimony in Oncor Acquisition Case

PUCT Staff File Testimony in Oncor Acquisition Case

Jan 19, 2017

by Margarita Fournier; Copyright 2016 by Competitive Assets, LLC.  All rights reserved

On 1/18/17, the PUCT staff filed testimony from several witnesses, including Darryl Tietjen in NextEra’s case to acquire Oncor (PUCT Docket No. 46238). His testimony centered on two questions: (a) should NextEra Energy’s ability to expense for ratemaking purposes a federal income tax be addressed in this docket; and (b) if so, should any tax savings derived from NextEra Energy’s structure or tax filings be shared with its ratepayers? In his recommendation, Darryl stated that:

  • “Assuming that the Commission approves the proposed transaction, and given the size of Oncor Electric Delivery Company (Oncor) and the amount of federal income-tax expense included in its Commission-authorized revenue requirement, clear Commission decisions made in this proceeding with regard to income-tax expense could serve to reduce uncertainty about the issue and decrease the potential, for controversy in Oncor’s next rate proceeding. Ultimately, however, the issue of recovery of federal income-tax expense is a fact-based issue and, absent unusual circumstances, is best evaluated in a company’s rate proceeding instead of a sale/transfer/merger (STM) docket; and
  • The proposed transaction would result in the inclusion of Oncor’s income in the consolidated tax return of NextEra Energy Inc. (NextEra), which is a traditional C corporation and therefore subject to federal income taxation at corporate tax rates. Consequently, it would be consistent with the treatment of income-tax expense in recent rate proceedings, Commission precedent, and existing statutory provisions for the Commission in Oncor’s next rate proceeding to include in Oncor’s revenue requirement an income-tax allowance determined as if Oncor were a conventional corporation. Historically, such a determination has not included a provision for the sharing of any income-tax savings with ratepayers.”

 

 The Commission has set aside four days at the end of February to hear the case and decide whether the transaction is in the public interest.

Back to Texas Electric News Clips

Posted by CompetitiveAssets on January 19th, 2017

  • Competitive Assets

    provides information and consulting for the Texas electric utility industry and is the information source relied upon by many retail electric providers, cooperatives, municipalities, generators, power marketers, brokers, aggregators, wires companies, PUCT staff, ERCOT staff, Texas legislators and staff, FERC staff, metering companies, members of the financial community, consumer representatives, and other parties interested in the Texas electric industry..

    For more, click here to visit CompetitiveAssets.com

  • News Services provided by Texas Electric Market Monitor

    Texas Electric Watch

    Texas Electric Policy News

    ERCOT Monitor Reports

    ====================

    For a free trial subscription to any of these 3 news services, please send an email to freetrial. If you are interested in subscribing any of these 3 news services, please click here or call Texas Electric Market Monitor at 512-985-8167

  • Special Reports by Competitive Assets

    How to Prepare Confidential Filings at the PUCT

    ====================

    For more information about this special report, please click here or go to CA Store-Special Reports page.

  • Rate Updates Services

    ERCOT TDU Rate Updates

    Provides updates of approved rates for TDUs in ERCOT in a spreadsheet format, updated twice per month

    If you are interested in subscribing this service, please click here

  • Texas Electric News Daily Email Service is a free service. If you like this news service, please consider supporting this website

  • Texas Electric News Daily Email Sign Up

    Enter your name and email address to receive daily Texas Electric News Clip emails

    ==============================

    By submitting this form, you are consenting to receive marketing emails from: . You can revoke your consent to receive emails at any time by using the SafeUnsubscribe® link, found at the bottom of every email. Emails are serviced by Constant Contact

  • Want to Share Your Opinion with Our Readers?

    Articles or Press Releases may be submitted to Competitive Assets via CAcontact@texaselectricnews.com Please Click Here to see our policy on article submission.

  • Search This Website