Loading...
HomeMy WebLinkAboutResolution - 2023-R0622 - Condition 16, Customer Choice Resolution, February 22, 2022 - 12/12/2023Resolution No. 2023-R0622 Item No. 6.1 December 12, 2023 RESOLUTION WHEREAS, the City of Lubbock and its municipally owned electric utility, Lubbock Power & Light ("LP&L") are currently served with wholesale power delivered through both the Electric Reliability Council of Texas ("ERCOT") and the Southwest Power Pool Regional Transmission Organization ("SPP"); WHEREAS, in Texas, retail electric competition and customer choice are available within ERCOT but are not available within SPP; WHEREAS, LP&L has taken necessary steps over the past few years to move its customer load from SPP into ERCOT, and on December 11, 2023, integration of the final group of customers has been successfully completed; WHEREAS, in support of its decision to move its customers into ERCOT, LP&L has also undertaken distribution projects and capital improvement projects, is finalizing a sale and purchase of real estate and utility assets with Southwestern Public Service Company ("SPS") and has sought the regulatory approvals required for the integration; WHEREAS, ERCOT has a robust market within which many retail electric providers ("REPs") participate, thereby allowing customers to choose their own REPs through the competitive market place; WHEREAS, Texas law provides that municipally owned utilities may choose to open their market to retail competition and allow their customers to participate in customer choice at any time on or after January 1, 2002, by adoption of an appropriate resolution of the municipal governing body or a body vested with power to manage and operate the municipally owned utility; WHEREAS, the municipal governing body or a body vested with the power to manage and operate a municipally owned utility has the discretion to decide when or if the municipally owned utility will provide customer choice; WHEREAS, the decision to participate in customer choice and electric competition by the adoption of a resolution is irrevocable; WHEREAS, Texas law also provides that the metering function of a municipally owned utility that provides competition to customers may not be deemed competitive, and, at the option of the municipally owned utility, may continue to be offered by the municipally owned utility as the sole provider; WHEREAS, upon the initiation of customer choice and retail electric competition, LP&L will continue to provide transmission and delivery services and the metering function for customers within LP&L's certificated service area; WHEREAS, the City Council of the City of Lubbock believes that customer choice and retail electric competition will benefit the citizens of Lubbock and enhance growth and economic development in Lubbock; WHEREAS, on February 22, 2022, the City Council of the City of Lubbock adopted an irrevocable resolution choosing to participate in retail electric competition and customer choice upon the occurrence of specified conditions, described herein, which were determined to be required prerequisites for offering customer choice and retail electric competition; WHEREAS, The Electric Utility Board passed a Resolution EUB R0078, on November 13, 2023, affirming the completion of the opt-in requirements set by the City Council in Resolution EUB R0010, passed February 15, 2022, resolving that customer choice and retail electric competition should commence upon approval of this resolution by the City Council of the City of Lubbock, and recommending that the City Council affirm the satisfaction of the conditions set forth in the Council's February 22, 2022 resolution and affirm the Electric Utility Board's Resolution to enter into retail electric competition; WHEREAS, the City Council of the City of Lubbock, as a municipal governing body vested with power to manage and operate LP&L (along with the Electric Utility Board of the City of Lubbock), wishes to offer customer choice and retail electric competition to the ratepayers of LP&L through this irrevocable resolution, upon the completion of the conditions outlined in the Irrevocable Resolution passed on or about February 22, 2022; WHEREAS, the City Council of the City of Lubbock understands that this Resolution is irrevocable; NOW, THEREFORE: BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF LUBBOCK: THAT, to the extent the City Council of the City of Lubbock possesses governance jurisdiction over LP&L, as prescribed by the City Charter and Ordinances of the City of Lubbock, including without limitation, Chapter 1, Article XII, Section 1 of the City Charter and Chapter 2, Article 2.03, Division 12 of the Code of Ordinances, the City Council of the City of Lubbock hereby irrevocably chooses to offer customer choice and retail electric competition to the ratepayers of LP&L, as contemplated by Chapter 40 of the Texas Utilities Code, subject to the conditions outlined herein. BE IT FURTHER RESOLVED BY THE CITY COUNCIL OF THE CITY OF LUBBOCK: THAT the conditions set forth in City Council Resolution No. 2022-R0408 have been satisfied or waived and, the following conditions having been met, customer choice and retail electric competition shall commence on the date prescribed below upon approval of this resolution by the City Council of the City of Lubbock: (1) Prior to the commencement date of retail competition, LP&L's Total Load has been fully integrated into ERCOT for a minimum period of sixty (60) days starting by December 11, 2023. (2) ERCOT and/or the Public Utility Commission of Texas, or any other applicable regulatory body, has approved the initiation of customer choice and retail electric competition for LP&L and its customers, as recognized by the City Council of the City of Lubbock on February 22, 2022 by Resolution No. 2022-R0408. (3) The Electric Utility Board and the City Council of the City of Lubbock have established the procedures and criteria for selecting the Provider of Last Resort ("POLR") for customers within LP&L's certificated service area as of the date of the initiation of customer choice and retail electric competition, and have ultimately designated another entity that will serve as the POLR pursuant to Texas Utilities Code § 40.053 as recognized by the City Council of the City of Lubbock on October 24, 2023 in Resolution No. 2023-R0533. (4) LP&L has the necessary software in place to bill retail electric providers and manage customer and meter related transactions and the software is fully operational and all necessary testing is completed. (5) LP&L has an EDI Gateway, which consists of a communication channel with ERCOT and all other required parties, which is now fully operational and all necessary testing has been completed as of October 7, 2023. (6) LP&L has completed its distribution system cutover such that all distribution within LP&L's certificated retail service area has been disconnected from the SPS Legacy System and connected with LP&L's current distribution system as of December 11, 2023. (7) The Electric Utility Board and the City Council of the City of Lubbock have determined that there are, and will continue to be, a sufficient number of retail electric providers, including a sufficient number of independent, unaffiliated retail electric providers within the ERCOT market, that are willing and able to provide service in Lubbock to adequately provide competitive customer choice and retail electric competition for LP&L's certificated area as confirmed by the City Council of the City of Lubbock on October 24, 2023 Resolution No. 2023-R0535. (8) LP&L has executed, and continues to execute as necessary, any and all necessary contracts with retail electric providers who intend to serve LP&L's certificated area upon the initiation of customer choice and retail electric competition. These contracts will be used in place of a registration requirement which is optional but permitted pursuant to Texas Utilities Code §39.358. (9) LP&L has made all necessary filings with the Public Utility Commission of Texas regarding its generation function, to the extent required under Texas Utilities Code § 40.055(a)(2) and rules promulgated thereunder. (10) The contracts LP&L is requiring with retail electric providers serve the function that a registration requirement would have provided, so no action is needed or has been taken by the EUB or the City Council of the City of Lubbock to require the registration of REPs that are serving the City of Lubbock pursuant to Texas Utilities Code § 39.358. (11) The Electric Utility Board and the City Council of the City of Lubbock have approved the Tariff for Competitive Retailer Access for the City of Lubbock, acting by and through Lubbock Power & Light, as provided in 16 Texas Administrative Code § 25.215 and Appendix V to the Public Utility Commission's Electric Substantive Rules, 16 Texas Administrative Code, Chapter 25, on July 25, 2023 by Resolution No. 2023-R0373 and further approved the rates for open access on distribution facilities under Texas Utilities Code § 40.058, and LP&L has made a timely filing of such rates with the Public Utility Commission of Texas. (12) LP&L has taken all steps necessary to continue the metering function for its customers in its certificated service area, with such metering function not being competitive as provided in Texas Utilities Code §§ 40.053(b) and 40.057. (13) LP&L has substantially completed installing its advanced metering infrastructure for electric service in LP&L's certificated area by September 2022. (14) The Electric Utility Board and the City Council have approved a transition to competition plan for customers in LP&L's certificated area that have not affirmatively selected their own retail electric provider prior to the date customer choice and retail electric competition is initiated, such action having been taken by the EUB on October 17, 2023 by Resolution No. EUB—R0069, and by the City Council on October 24, 2023 by Resolution No. R0534. (15) The option to waive any of the listed conditions, if and only if such conditions are not legally required for the adoption of customer choice and retail electric competition in the City of Lubbock, has been taken or foregone by the Electric Utility Board and the City Council. BE IT FURTHER RESOLVED BY THE CITY COUNCIL OF THE CITY OF LUBBOCK: THAT Condition (16) of City Council Resolution No. 2022-R0408, confrming that the foregoing conditions in that resolution have, in the City Council's sole judgment, been satisfied or exceeded, has also been satisfied and that retail electric competition shall commence on March 4, 2024. BE IT FURTHER RESOLVED BY THE CITY COUNCIL OF THE CTTY OF LUBBOCK: THAT the decision to initiate customer choice and retail electric competition upon the conditions outlined herein is irrevocable and cannot be revoked, recalled, repealed, or altered in any way. BE IT FURTHER RESOLVED BY THE CITY COUNCIL OF THE CITY OF LUBBOCK: THAT the City Council of the City of Lubbock affirms the satisfaction of the conditions set forth in the irrevocable resolution opting into retail competition. Passed by the City Council this 12�h day of December, 2023. . • • ;�; � . - � ���' vy, Chief Administr�ve Officer APPROVED AS TO FdRM: �s'�'-�C� Carolyn ellman, Interim General Counsel RESOLUTION WHEREAS, the City of Lubbock and its municipally owned electric utility, Lubbock Power & Light ("LP&L") are currently served with wholesale power delivered through both the Electric Reliability Council of Texas ("ERCOT") and the Southwest Power Pool Regional Transmission Organization ("SPP"); WHEREAS, in Texas, retail competition and customer choice are available within ERCOT but are not available within SPP; WHEREAS, approximately seventy percent (70%) of LP&L's load is currently in ERCOT (the "Affected Load"); WHEREAS, LP&L has taken steps to move the remainder of its load, approximately thirty percent (30%), from SPP to ERCOT (the "Remaining Load"); WHEREAS, on or about October 29, 2010, LP&L purchased the majority of Southwestern Public Service Company's ("SPS") distribution assets located within the Lubbock city limits ("SPS Legacy System"); WHEREAS, LP&L has undertaken certain distribution projects to move LP&L customers on SPS's Legacy System over to LP&L's distribution system in preparation for the integration of the Remaining Load into ERCOT; WHEREAS, LP&L will have fully integrated one hundred percent (100%) of its load in the ERCOT market by December 11, 2023 ("LP&L's Total Load"), and has completed all of the necessary capital improvement projects and regulatory approvals required for the integration; WHEREAS, ERCOT has a robust mazket within which many retail electric providers ("REPs") participate, which allows customers to choose their own retail electric providers through the competitive market place; WHEREAS, Texas law provides the opportunity for municipally owned electric utilities to elect to provide customer choice to their customers; WHEREAS, the municipal governing body or a body vested with the power to manage and operate a municipally owned utility has the discretion to decide when or if the municipally owned utility will provide customer choice; WHEREAS, Texas law provides that municipally owned utilities may choose to participate in customer choice at any time on or after January 1, 2002, by adoption of an appropriate resolution of the municipal governing body or a body vested with power to manage and operate the municipally owned utility; WHEREAS, the decision to participate in customer choice and electric competition by the adoption of a resolution is irrevocable; WHEREAS, Texas law provides that the metering function of a municipally owned utility that provides competition to customers may not be deemed competitive, and, at the option of the municipally owned utility, may continue to be offered by the municipally owned utility as the sole provider; WHEREAS, the Electric Utility Board of the City of Lubbock (the "EUB" or "Electric Utility Board") believes that customer choice and retail electric competition will benefit the citizens of Lubbock and enhance growth and economic development in Lubbock; WHEREAS, the Electric Utility Board understands that this Resolution is irrevocable; WHEREAS, the EUB desires to adopt this irrevocable resolution to choose to participate in customer choice and retail electric competition upon the occurrence of specified conditions, contained herein, which are required prerequisites for offering customer choice and retail competition; WHEREAS, upon the initiation of customer choice and retail electric competition, LP&L will continue to provide transmission and delivery services and the metering function for customers within LP&L's certificated service area; WHEREAS, the EUB, as a governing body vested with power to manage and operate LP&L (along with the City Council of the City of Lubbock), wishes to offer customer choice and retail competition to the ratepayers of LP&L through this irrevocable resolution, upon the conditions outlined herein. NOW, THEREFORE: BE IT RESOLVED BY THE ELECTRIC UTILITY BOARD OF THE CITY OF LUBBOCK: THATto the extent the EUB possesses governance jurisdiction over LP&L, as prescribed by the City Charter and Ordinances of the City of Lubbock, including without limitation, Chapter 1, Article XII, Section 1 of the City Charter and Chapter 2, Article 2.03, Division 12 of the Code of Ordinances, the Electric Utility Board of the City of Lubbock hereby irrevocably chooses to offer customer choice and retail electric competition to the ratepayers of LP&L, as contemplated by Chapter 40 of the Texas Utilities Code, subject to the conditions outlined herein. BE IT FURTHER RESOLVED BY THE ELECTRIC UTILITY BOARD OF THE CITY OF LUBBOCK: THAT the Chief Administrative Officer of LP&L, formerly known as the Director of Electric Utilities, BE and is hereby DIRECTED to take all remaining necessary steps to initiate customer choice and retail electric competition for LP&L ratepayers, as permitted by Chapter 40 of the Texas Utilities Code, including, without limitation, steps necessazy to implement customer choice and retail electric competition and to timely report same to the Electric Utility Boazd of the City of Lubbock. BE IT FURTHER RESOLVED BY THE ELECTRIC UTILITY BOARD OF THE CITY OF LUBBOCK: THAT the conditions set forth in EUB Resolution 2022 EUB-R0010 have been satisfied or waived and, the following conditions having been met, customer choice and retail electric competition shall commence upon approval of this resolution by the City Council of the City of Lubbock: (1) LP&L's Total Load has been fully integrated into ERCOT for a minimum period of sixty (60) days starting by December 11, 2023. (2) ERCOT and/or the Public Utility Commission of Texas, or any other applicable regulatory body, has approved the initiation of customer choice and retail electric competition for LP&L and its customers, as recognized by the City Council of the City of Lubbock on February 22, 2022 by Resolution No. 2022-R0408. (3) The Electric Utility Board and the City Council of the City of Lubbock have established the procedures and criteria for selecting the Provider of Last Resort ("POLR") for customers within LP&L's certificated service area as of the date of the initiation of customer choice and retail electric competition, and have ultimately designated another entity that will serve as the POLR pursuant to Texas Utilities Code § 40.053 as recognized by the City Council of the City of Lubbock on October 24, 2023 in Resolution No. 2023-R0533. (4) LP&L has the necessary software in place to bill retail electric providers and manage customer and meter related transactions and the software is fully operational and all necessary testing is completed. Final completion of software coniiguration is scheduled to be completed on December 17, 2023. (5) LP&L has an EDI Gateway, which consists of a communication channel with ERCOT and all other required parties, which is now fully operational and all necessary testing has been completed as of October 7, 2023. (6) LP&L is scheduled to complete its distribution system cutover such that all distribution within LP&L's certificated retail service area will be disconnected from the SPS Legacy System and connected with LP&L's current distribution system by December 11, 2023. (7) The Electric Utility Board and the City Council of the City of Lubbock have determined that there are, and will continue to be, a sufficient number of retail electric providers, including a sufficient number of independent, un�liated retail electric providers within the ERCOT market, that are willing and able to provide service in Lubbock to adequately provide competitive customer choice and retail electric competition for LP&L's certificated area as confirmed by the City Council of the City of Lubbock on October 24, 2023 Resolution No. 2023-R0535. (8) LP&L has executed, and continues to execute as necessary, any and all necessary contracts with retail electric providers who intend to serve LP&L's certificated area upon the initiation of customer choice and retail electric competition. These contracts will be used in place of a registration requirement which is optional but permitted pursuant to Texas Utilities Code §39.358. (9) LP&L has made all necessary filings with the Public Utility Commission of Texas regarding its generation function, to the extent required under Texas Utilities Code § 40.055(a)(2) and rules promulgated thereunder. (10) The contracts LP&L is requiring with retail electric providers serve the function that a registration requirement would have provided, so no action is needed or has been taken by the EUB or the City Council of the City of Lubbock to require the registration of REPs that are serving the City of Lubbock pursuant to Texas Utilities Code § 39.358. (11) The Electric Utility Board and the City Council of the City of Lubbock have approved the Tariff for Competitive Retailer Access for the City of Lubbock, acting by and through Lubbock Power & Light, as provided in 16 Texas Administrative Code § 25.215 and Appendix V to the Public Utility Commission's Electric Substantive Rules, 16 Texas Administrative Code, Chapter 25, on July 25, 2023 by Resolution No. 2023-R0373 and further approved the rates for open access on distribution facilities under Texas Utilities Code § 40.058, and LP&L has made a timely filing of such rates with the Public Utility Commission of Texas. (12) LP&L has taken all steps necessary to continue the metering function for its customers in its certificated service area, with such metering function not being competitive as provided in Texas Utilities Code §§ 40.053(b) and 40.057. (13) LP&L had substantially completed installing its advanced metering infrastructure for electric service in LP&L's certificated area by September 2022. (14) The Electric Utility Board and the City Council have approved a transition to competition plan for customers in LP&L's certificated area that have not affirmatively selected their own retail electric provider prior to the date customer choice and retail electric competition is initiated, such action having been taken by the EUB on October 17, 2023 by Resolution No. EUB—R0069, and by the City Council on October 24, 2023 by Resolution No. R0534. (15) Any of the foregoing conditions may be waived by the Electric Utility Boazd and the City Council if and only if such conditions aze not legally required for the adoption of customer choice and retail electric competition in the City of Lubbock. (16) T'his resolution shall be null and void and of no effect whatsoever unless the City Council also adopts an irrevocable resolution confirming that the conditions previously established for implementing customer choice and retail electric competition within LP&L's certificated retail service area have been satisfied and establishing a date certain for customer choice and retail electric competition to begin in the City of Lubbock. BE IT FURTHER RESOLVED BY THE ELECTRIC UTILITY BOARD OF THE CITY OF LUBBOCK: That customer choice and retail electric competition shall be initiated on the completion of all conditions provided herein and that retail electric competition shall commence on March 4, 2024 BE IT FURTHER RESOLVED BY THE ELECTRIC UTILITY BOARD OF THE CITY OF LUBBOCK: That the decision to initiate customer choice and retail electric competition upon the conditions outlined herein is irrevocable and cannot be revoked, recalled, repealed, or altered in any way. BE IT FURTHER RESOLVED BY THE ELECTRIC UTILITY BOARD OF THE CITY OF LUBBOCK: THAT the Electric Utility Board hereby recommends to the City Council of the City of Lubbock that the recitals and preambles of this resolution be adopted as further findings of the Electric Utility Board and that the City Council affirm the satisfaction of the conditions set forth in the irrevocable resolution opting into retail competition. Passed by the Electric Utility Board this 13`h day of November, 2023. APPROVED AS T CONTENT: Joe y, ief A i i tive Officer APPROVED AS TO FORM: '� �t. Cazolyn llman, Interim General Counsel