During an earnings call yesterday, Sempra Energy CEO Debra Reed said, in response to a question regarding whether ring-fencing adopted as part of its acquisition of Oncor would be "long-term", that the company would hope, after earning the confidence of Texas regulators, to be able to transition from the terms originally adopted.

"When we look at Oncor and the ring-fencing and we look at the independent Board of Directors, at some point, it would be nice for us to have built the confidence of the regulators in the State of Texas by how we act as an owner, that they would see that we should be treated like any other utility in the State of Texas. And other utilities don't have that kind of structure. But I think it's something that we have to earn over time, with the way that we capitalize that business and ensure that we honor the provisions and that they see that Oncor management really makes the decisions for the best interest of Texas and its customers. And I hope we are able to earn that confidence from the regulators over time," Reed said

"When we looked at the ring-fence and those provisions, we felt it was not significantly different than what we have or how we've operated with our California utilities under a first priority condition, where we have to put capital into those utilities to meet their needs. And so, is it livable? Yes. Would we want to change it over time, with us proving that we were strong owners and the Commission feeling that we should have the same kind of regulatory structure that the other Texas utilities do. When we get to that point, we would look at maybe a way to transition," Reed said

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Texas   Oncor   Sempra   M&A  

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