HomeMy WebLinkAbout03-29-18 Annual GRIP Adjustment for the Texas Coast Divisions CenterPoint CenterPoint Energy
1111 Louisiana Street
Energy Houston,TX 77002-5231
P.O.Box 2628
March 29, 2018 Houston,TX 77252-2628
Mayor and City Council
City of La Porte
La Porte, Texas
Re: CenterPoint Energy 2018 Annual GRIP Adjustment for the Texas Coast Division
Dear Madam or Sir:
CenterPoint Energy Resources Corp., d/b/a CenterPoint Energy Entex and CenterPoint
Energy Texas Gas ("CenterPoint" or the "Company"), files the enclosed tariffs and supporting
documents, including a CD of the electronic files, with the City of La Porte ("City") consistent
with Section 7.7101 of the Railroad Commission of Texas("Commission")Gas Services Division
Rules and Section 104.301 of the Texas Utilities Code to establish the annual gas reliability
infrastructure program("GRIP") interim rate adjustment("IRA")for the Company's Texas Coast
Division, which includes the City. The proposed IRA will affect rates for natural gas service
customers located in the City. Simultaneously with this filing,CenterPoint makes the same GRIP
filing with the Commission for customers located in the City's environs and cities of the Texas
Coast Division that have ceded original jurisdiction to the Commission.
CenterPoint consistently supplies its customers in the Texas Coast Division with safe and
dependable natural gas service by prudently investing in additions and upgrades to its delivery
system. The Company will continue to prudently invest in its infrastructure in order to improve
its natural gas service to its customers and to anticipate and meet their needs under all operating
conditions. The GRIP program enables a gas utility such as CenterPoint to begin recovery of its
incremental capital investment in the system, subject to a prudence review in its next rate case.
Consistent with Section 104.301 of the Texas Utilities Code and Commission precedent,the City's
review of this GRIP filing is limited to a ministerial review to ensure compliance with the GRIP
statute.
Pursuant to applicable law, the proposed IRA will become effective on May 28, 2018,
unless the City suspends that date for a period of no longer than forty-five(45)days. The approved
IRA will be applied to the monthly customer charge and will remain in effect until superseded by
the earlier of(1)the effective date of the Company's next annual GRIP adjustment for the Texas
Coast Division;or(2)the issuance of a final order in a rate setting proceeding for the Texas Coast
Division.
As detailed in the attached schedules and supporting material, the Company invested
$31,889,184 in its Texas Coast Division between October 1, 2016 and December 31, 2017, and
the applicable IRA is:
City of La Porte
March 29, 2018
Page 2
Current Proposed Proposed
Rate Customer 2018 Interim Customer Increase to
Schedules Charge Adjustment' Charge Each Bill
R-2096-I-GRIP 2018; $15.75 $0.72 $16.47 $0.72
R-2096-U-GRIP 2018 per customer per customer per customer per customer
Residential per month per month per month per month
GSS-2096-I-GRIP 2018; $18.25 $1.10 $19.35 $1.10
GSS-2096-U-GRIP 2018 per customer per customer per customer per customer
General Service per month per month per month per month
Small
GSLV-627-I-GRIP 2018; $180.00 $23.03 $203.03 $23.03
GSLV-627-U-GRIP 2018 per customer per customer per customer per customer
General Service per month per month per month per month
Large Volume
Along with and in support of the IRA, CenterPoint also includes the following:
(a) An earnings monitoring report showing the Company's earnings for the Texas
Coast Division during the 2017 calendar year (under the "Earnings Report"
section of the enclosed filing).
(b) An Interim Cost Recovery and Rate Adjustment Report containing accounting
schedules and project reports for the GRIP Adjustment Period including a
description of(i)the projects undertaken during the GRIP Adjustment Period(ii)
the investment to provide utility service in the Texas Coast Division,which were
both completed and placed in service during the GRIP Adjustment Period, (iii)
the Company's prior utility investments in the Texas Coast Division that were
either retired or abandoned during the GRIP Adjustment Period,and(iv)the cost,
need and customers benefited by those investments and retirements (under the
"Investment and Retirement Project Report"section of the enclosed filing).
t On December 22,2017,the Tax Cuts and Jobs Act of 2017(the"TCJA")was signed into law. The TCJA reduced the
federal corporate income tax rate from 35%to 21%. The Proposed 2018 Interim Adjustment in the table above has been calculated
using the reduced corporate income tax rate of 21% Without the use of the reduced corporate income tax rate in the Company's
2018 GRIP filing,the 2018 Interim Adjustment for each class would be as follows:Residential$0.77;General Service Small$1.18;
and General Service Large Volume$24.66.
City of La Porte
March 29, 2018
Page 3
(c) The Company's calculations of the GRIP Adjustment amount to go into effect on
the later of the Planned Effective Date or the end of any suspension period
imposed (under the "Initial Adjustment Report" section of the enclosed filing).
The Company has calculated the GRIP Adjustment using the 35% federal
corporate income tax rate approved in GUD No. 10567. The Company has also
calculated and is seeking approval of the GRIP Adjustment using the 21%federal
corporate income tax rate under the Tax Cuts and Jobs Act of 2017.
(d) Affidavits by Kristie Colvin, Shonda Royston Johnson and Randal M. Pryor
(under the"Affidavits" section of the enclosed filing).
• Ms. Colvin's affidavit verifies (i) that the Texas Coast Division's
books and records are kept in accordance with the rules of the
Commission and(ii)that the reports enclosed accurately reflect the
Texas Coast Division's books and records related to the information
in those reports.
• Ms. Royston Johnson's affidavit verifies the notice of the GRIP
filing through customer bill inserts.
• Mr. Pryor's affidavit concerns the reimbursement of relocation
expenses.
In addition,the source documentation and workpapers supporting the data and calculations
contained in the foregoing reports is maintained in CenterPoint's electronic databases which are
available for review. To schedule an opportunity to review the electronic databases or any hard
copy project files related to the new investment or retirements, please contact me at (512) 397-
3048.
Notice of this proceeding will be provided to affected customers in the Texas Coast
Division by bill insert or by separate mailing within 45 days after the date of this filing in
accordance with the applicable law.
Please accept for filing the above-mentioned tariffs, filing package and enclosures and
return the enclosed copy of this letter with your file mark thereon to acknowledge such filings for
our records.
Please do not hesitate to contact us with any questions you may have regarding this filing.
Sincerely,
(titeA.—N
Perrin Wall
Manager of Regulatory Affairs
City of La Porte
March 29,2018
Page 4
Attachments
cc: Mr. Randal M. Pryor
Mr. Sam Chang
Ms. Gracy Rodriguez
DELIVERED TO:
Stitt (i S , G ( of
NAME OFFIC (Mayor, City ecretary, etc.)
the City of La Porte on this al day of March 2018.
,AGIAP1014AALL)
SIG ATURE