AEP Texas Central Co., which is looking to raise as much as $1.7 billion through securitization, filed what it called a unanimous settlement agreement with the Public Utility Commission of Texas. The accord will hold them - and all other affected parties - to any securitization financing order that the commissioners decide on later this year.
If the PUCT accepts the settlement agreement, its commissioners will essentially have the final word on how much in ABS bonds the Texas Central Company can raise. Company officials said, AEP Texas Central Co. might use a portion of the funds to repay state debt and recover stranded costs. The securitization will proceed without any appeal from industrial customers, consumer advocacy groups, municipalities, or any other party.
"Issuing the bonds as soon as practical after the order benefits all parties and will save our TCC [Texas Central Company] customers significant interest charges on the true-up balance that would otherwise have continued to accrue during any appeals of the order," TCC said in a statement.
"We are making significant capital investments across the company," said Melissa McHenry, manager of corporate media relations for Texas Central Co. "So the money will be available for some of that."
The Public Utility Commission of Texas has yet to accept the agreement, because it is awaiting input from the various parties involved in the unanimous settlement. If the commission does accept the settlement agreement, then it will decide whether the bonds can be used to recover a net or a gross amount of the securitization total. For its part, Texas Central Company hopes that the commission will issue a securitization order by the end of June, so that it can issue the bonds by the fall.
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