CPS Energy faced with tough trade-offs
By Anton Caputo and Tracy Idell Hamilton - Express-News
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Cutting costs
CPS Energy is considering a delay in several areas to hold down debt. They include:
- Scrubbers that would limit pollution on the utility's coal plants.
- Infrastructure for its advanced metering initiative so customers can keep better track of energy use.
- Infrastructure for its distributed energy system needed for smaller renewable energy projects.
Board meeting
- The CPS Energy trustees will meet at 2:30 p.m. Tuesday at 145 Navarro.
CPS is expected to scale back its ownership of the proposed expansion of the South Texas Project when the board meets Tuesday, in an effort to lower its financial risk and tamp down mounting debt.
Utility officials also are talking about delaying the installation of scrubbers at its coal plants and pushing back the upgrade of its energy grid to save money.
Pressure from Wall Street may force city officials to consider a series of rate increases higher than the utility anticipated in the coming years, a realization that hit the City Council last week when CPS Energy leaders floated the possibility of a 9.5 percent rate boost.
The shifting landscape comes weeks before the city will decide whether to go forward with its portion of the proposed $13 billion nuclear expansion.
In two weeks, the City Council will vote on borrowing $400 million more for the STP expansion. CPS Energy’s board of trustees is expected to approve the debt Tuesday, a move that could put the utility’s total investment at about $680 million for a project that likely won’t have a fixed price tag until 2012.
But at the council’s five-hour meeting Wednesday, it was clear from the questions that members still are all over the map. Some said they haven’t had enough time together to discuss the issue.
“We need some final numbers, so we can hold CPS accountable,” said Councilman John Clamp, adding that he’s frustrated with what he terms the lack of information the utility has shared with the council.
He wants answers before he votes to continue funding the expansion, which he supports.
“We never go over the assumptions, we just see the bottom line,” Clamp said. “I want to see the assumptions they’re working from.”
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