CenterPoint will no longer withdraw its rate case. Cities say this makes a rate decrease possible.

CenterPoint Energy will no longer withdraw from a required review of its rates, a win for cities and consumer advocates who argued a withdrawal would deny them the opportunity to push for a rate decrease they say is justified. 

The Houston-area electric utility notified the Public Utility Commission of Texas of its plans to continue settlement talks with cities and consumer representatives late Friday afternoon. Those negotiations have been paused since CenterPoint first tried to withdraw its rate case in August following scathing criticism of its Hurricane Beryl response. 

CenterPoint had fought to withdraw its rate case as recently as two weeks ago. Its executives have argued for months that continuing rate case negotiations would distract the company from its ongoing efforts to improve the resiliency of its Houston-area grid and restore public trust. 

But in the last few weeks, CenterPoint has had “a number of discussions with stakeholders in the process,” leading to Friday’s decision to no longer pursue a withdrawal, said Jason Ryan, the company’s executive vice president of regulatory services and government affairs, in an interview. 

CenterPoint now aims to resolve rate case negotiations before it files a $5 billion proposal to strengthen its grid against extreme weather, known in the industry as a resiliency plan, Ryan said. The company previously said it would file this plan, which could add more than $3.50 to the average residential customer’s monthly bill, in January. 

The Friday announcement concludes a monthslong fight over the continuation of CenterPoint’s rate case after an administrative law judge denied the company’s initial motion to withdraw in August. CenterPoint appealed the judge’s decision to the PUC, which has final say. The PUC was supposed to make a final decision on the issue at its open meeting next Thursday.  

Since August, city coalitions and the Texas Consumer Association have testified that CenterPoint overcharged customers by $100 million in 2023 and that there is “overwhelming evidence” supporting a rate decrease. Those groups won allies in Lt. Gov. Dan Patrick and Houston Mayor John Whitmire, who’ve both publicly opposed CenterPoint withdrawing its rate case so the PUC can ensure it's not overcharging. 

CenterPoint has strongly contested claims that it’s overearning. It points to $75 million the company spent in 2023 on system improvements and vegetation management that it didn’t pass on to customers. 

The company’s initial rate case application, filed in March, sought a rate increase of $1.25 per month for the average residential customer. The final rate won’t be any higher than that as CenterPoint resumes negotiations with cities and consumer groups, Ryan said.

“I can tell you that, having done this for 25 years, settlements always result in the proposed rates being lower than the initial application,” Ryan said. “But we know that we need to work through issues and make our rates as affordable as possible.”