Settlement In Oncor-InfraREIT M&A Case: Sharyland Start-up Regulatory Asset Won't Be Recovered
April 08,2019
Oncor Electric Delivery Company LLC ("Oncor), Sharyland Distribution & Transmission Services, L.L.C. ("SDTS"), Sharyland Utilities, L.P. ("Sharyland), Sempra Energy, Staff of the Public Utility Commission of Texas, the Office of the Public Utility Counsel, Alliance for Retail Markets, Steering Committee of Cities Served by Oncor, Texas Energy Association for Marketers, and Texas Industrial Energy Consumers have filed a settlement under which Oncor's proposed purchase of InfraREIT, Inc. (InfraREIT) and its subsidiary, InfraREIT Partners, LP would be approved.
The stipulation would also approve Sempra Energy's purchase of an indirect ownership interest in Sharyland Utilities, L.P., which will continue to own assets in South Texas.
InfraREIT and Sharyland Utilities, L.P. own transmission assets, and no delivery service (and therefore delivery rates) are directly implicated by the acquisitions
Notably, however, is a provision of the settlement which provides that neither Oncor nor Sharyland (South Texas Utility) will seek recovery of the approximately $30,000,000 regulatory asset associated with the startup costs incurred at the inception of Sharyland.
Furthermore, Oncor will not seek recovery of any amount of the approximately $8.9 million regulatory asset related to Sharyland's rate case expenses that were requested in Docket No. 45979. Sharyland will not seek recovery of any rate case expenses that were requested or incurred in Docket No. 45979.
The settlement also includes various credits for wholesale transmission service customers, including $17 million in merger savings credits, as well as an agreement not to recover various merger-related costs