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ALJ Issues Proposed Order Adopting Parties Alternative Proposed Mechanism to Return Transition Charge Refunds to REPs
On March 3, 2025 an Administrative Law Judge (ALJ) issued a Proposed Order and Memorandum that would require CenterPoint Energy Houston Electric, LLC to refund the balances in the collection account associated with Schedule TC5. The Commission is being asked to approve the Rider TC5 Refund tariff included as attachment E to CenterPoint Houston’ s amended compliance filing filed on January 23, 2026.
This methodology would utilize existing market processes to provide the refunded amounts on a per-customer basis for all retail electric providers.
The ALJ memorandum asks that this recommendation be placed on the open meeting agenda for the Commissioners’ consideration.
As reported previously, on February 17, 2026 CenterPoint Energy Houston Electric, LLC (“CenterPoint Energy”), the Texas REP Coalition (“TRC”), and the Staff of the Public Utility Commission of Texas (“Commission Staff’), filed a Joint Motion to Admit Evidence. In this filing the parties proposed an alternative refund mechanism under which the TDU would refund or otherwise disburse the TC5 final account balance through a proposed Rider TC5 Refund tariff mechanism, over a forecasted six-month period beginning on May 1, 2026.
As reported previously the over-collection TC5 transition charge rider collected by CenterPoint Energy Houston amounts to roughly $15 million dollars.
The proposed Rider TC5 Refund would use existing billing mechanisms in place used by the Texas Standard Electronic Transactions (Texas SET).
The ALJ endorsed the alternative proposal stating that “[i]t is in the public interest to approve a distribution method that can be implemented to benefit retail customers and that conforms with the Commission’s intention expressed in the Finding of Fact 64 of the Financing Order that the remaining collection account amounts should be credited to retail customers.”
Rider TC5 Refund is proposed to be effective May 1, 2026, and is expected to be in effect for a period of six months or until the aggregate over-collection balance is exhausted.
