Texas Transition to Competition Proceeding

Members of the Firm provided assistance to the North Star Steel Texas, Inc. (Beaumont) regarding rate and competition restructuring issues associated with Entergy Gulf State’s Transition to Competition proceeding filed before the Public Utility Commission of Texas. This competition proceeding was broken down into four phases: (i) Fuel Phase; (ii) Revenue Requirement Phase; (iii) Rate Design and Cost Allocation Phase; and, (iv) Competitive Issues Phase. In recognition of the significant changes which have and continue to take place within the electric utility industry and the need to establish sound regulatory and operational principles so that North Star Steel is treated in a fair and equitable manner, ERG staff addressed the following issues:

    • Cost allocation and rate design issues which attempt to shift additional cost to North Star Steel;
    • Support for the continuation of interruptible service rates based on deferred future capacity, market valuation, and spinning reserve credit derivation methodologies;
    • The analysis and development of potential stranded cost recovery derivations and their impact on ratepayers;
    • The effects that the functional unbundling of current rate schedules into generation, transmission, distribution/ customer service, and USC functional components has on individual ratepayers;
    • The proposed USC Rider and its proposed collection from interruptible customers;
    • The evaluation and development of specific plans for the restructuring of Entergy Gulf States in preparation for the future of a competitive environment.

The assistance provided to North Star included the preparation of direct and rebuttal testimony, appearances at scheduled regulatory hearings to present testimony subject to cross-examination, the cross-examination of other witnesses providing testimony and, general rate case support.

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