CenterPoint Energy customers to see decrease in bill due to new financing order - 14 News WFIE Evansville
CenterPoint Energy customers to see decrease in bill due to new financing order
EVANSVILLE, Ind. (WFIE) - CenterPoint Energy officials say customers will soon see a decrease in their electric bills.
According to a release, the decrease is a result of the company’s securitization pilot, which allows for the removal of the remaining value of its A.B. Brown coal plant assets from customer rates.
Officials say in January 2023, the Indiana Utility Regulatory Commission approved a financing order for the coal retirement securitization bonds, which is expected to result in a total decrease to customers’ electric bills by an estimated $53 million when compared to traditional ratemaking.
A release shows all Indiana electric customer classes – residential, small commercial, industrial – will realize savings. Residential customers using approximately 900 kWh per month are expected to see a nearly $5 bill credit per month on their bills.
They say the credits from the securitization of A.B. Brown assets will more than offset the new securitization charge added to customers’ bills to pay for the securitization bonds.
CenterPoint Energy says they plan to retire the A.B. Brown coal units 1 and 2 in October 2023 as part of its long-term electric generation transition plan. The remaining value of the coal plants and other qualified costs are financed through the issuance of these securitization bonds at a lower long-term interest rate.
According to officials, while CenterPoint Energy is the first utility to use securitization financing in Indiana, this is an established practice that has saved utility customers millions of dollars in nearly 30 states. CenterPoint Energy will reinvest proceeds from the securitization bonds into its generation transition plan, including renewable resources such as wind- and solar-powered generation, both of which will be backed up by natural gas generation resources to maintain reliability.
Copyright 2023 WFIE. All rights reserved.
Related Knowledge Center: Climate legislation
The federal government and states are in the process of implementing two laws — the Infrastructure Investment and Jobs Act and the Inflation Reduction Act — an investment of more than a trillion dollars to address climate change.