The three Public Utility Commission of Texas commissioners said Thursday they will not approve NextEra’s proposed deal to purchase Oncor. They all said the NextEra deal is not in the public interest.
Donna Nelson, PUC chair, identified concerns about removing “ring-fencing protections.” Those protections would keep Oncor from being affected by financial problems associated with its parent company. Nelson said, “The lack of a truly independent, disinterested board and the lack of independent board control over the dividends are what worry me the most. Unfortunately, those are the issues on which it seems NextEra is not willing to budge.”
Commissioner Ken Anderson said an independent board helped Oncor continue operating efficiently after Energy Future Holdings fell into bankruptcy. Commissioner Brandy Marquez agreed that the Commission should not bend on requiring an independent board.
The NextEra purchase is the second attempt to purchase Oncor. The Commission previously rejected an Oncor deal with Hunt Consolidated. Texas electric customers, including large industrial companies opposed both transactions. The sale of Oncor is an important part of the restructure of almost $50 billion in debt from Energy Future Holdings’ leveraged buyout of the former TXU Corp. Oncor is a regulated electric utility that operates the largest distribution and transmission system in Texas – the sixth largest in the nation – serving more than 10 million Texans living in 402 cities and 91 counties.
While it is possible new negotiations will take place now the commissioners have made their positions known, all three commissioners said the Commission should take NextEra at its word that the independent board and other Commission-favored conditions are deal-breakers for NextEra. The next PUC open meeting is scheduled on April 13. A vote at that meeting to deny the acquisition is likely.