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Utility Provides Another Option to Handle REP Refund of Transition Charges
CenterPoint Energy Houston Electric filed an amendment to the compliance filing for Rider TC5 Refund with the Texas PUC intended to refund to retail electric providers (REPs) over-collections under the TC5 transition charge rider.
As previously reported on December 12, 2025, CenterPoint filed an application in this docket seeking approval to refund the TC5 transition charge collection balance existing under the TC5 Financing Order. In response to that filing on January 9,2026, the Texas REP Coalition filed a motion to intervene and requested that the Commission consider an alternative refund distribution methodology In consideration of that request, CenterPoint Houston therefore filed this most recent amendment (referred to as Option 2) to present an additional refund methodology for the Commission’s consideration.
CenterPoint’s originally requested Commission approval to refund the TC5 final account balance by distributing the full TC5 collection balance directly to retail electric providers (“REPs”). Under this approach, (subsequently referred to as Option 1) refunds would be issued to each REP in proportion to the TC5 transition charges paid by that REP to CenterPoint Houston during the applicable 12-month period. In its original filing CenterPoint indicated that the nearly $15 million to be refunded to REPs represents the balance remaining after the TC5 bonds were fully paid off
CenterPoint’s Option 1 would distribute the entirety of the TC5 collection balances to each REP via separate refunds to each REP based on the proportion of TC5 transition charges each REP remitted from August 1, 2023, through the date the TC5 charge ended, which was July 31, 2024.
In response to the REP Coalition alternative refund mechanism, CenterPoint Houston proposed that it would refund/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.
The Rider TC5 Refund approach proposed in Option 2 is consistent with tariff based refund mechanisms previously approved by the Commission for the refund of TC2 and TC3 balances and would provide an administratively efficient means of returning the TC5 final account balance to customers.
In its filing, CenterPoint stated that “[i]f the Commission selects Option 2, the only mechanism by which CenterPoint Houston can be made whole is through the creation of a regulatory asset or regulatory liability. Absent an additional another true-up, CenterPoint Houston has limited means to refund amounts to, or recover amounts from, customers. Therefore, CenterPoint Houston requests permission to establish a regulatory liability or regulatory asset to recover any difference in amounts owed to customers attributable to timing or retracts/rebills associated with the Rider TC5 Refund.”
“The TC5 final account balance would be allocated to the Company’ s current rate classes based on each rate classes billed sales, less the amounts charged-off, during the applicable 12-month period. Under Option 2, the Company would refund the TC5 final account balance through Rider TC5 Refund beginning on May 1, 2026, based on a forecasted six-month period, which will replace the existing Rider SRC & ADFIT Refund in the Company’s Retail Tariff. As noted above, the Company seeks authority to establish a regulatory asset or regulatory, as necessary, to reconcile any difference between the forecasted refund amount and the actual TC5 final account balance.”
Docket. 59113
(Compliance Filing Of Centerpoint Energy Houston Electric, LLC For The Refund Of Transition Charges Under Schedule TC5)
