CenterPoint Energy 2006 Annual Report Download - page 9

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We reached a rate case agreement approved by the Public Utility Commission of Texas (PUCT) that
reduces our electric delivery base rate revenues by $58 million per year and freezes distribution
rates until June 30, 2010. As part of the agreement, we will fund $10 million per year for programs
providing financial assistance to qualified low-income customers and increase our investments
to promote energy efficiency by an additional $10 million annually, raising our total energy
efficiency funding to $23 million per year. The settlement resolved all issues related to the remand
of our 2001 unbundled cost of service proceeding by providing $32 million in wholesale and retail
rate credits over approximately four years. Additionally, the agreement allows us to amortize
expenditures related to Hurricane Rita over a seven-year period and to amortize rate case expenses
associated with the 2006 rate review over a four-year period. The settlement also provides us with a
mechanism to change our transmission rates in 2008 to earn on our investment in new projects.
With this agreement in place, we are able to focus on meeting the growing demands of the
Texas electric market.
In 2006, we invested over $389 million in new
infrastructure, reflecting the booming economy
and significant development in our area.
• We added 227 miles of overhead distribution lines.
• We laid 1,242 miles of underground distribution lines.
• We made significant progress on the $95 million
Hillje transmission project, which will ease electric
grid congestion and add 117 transmission circuit
miles when completed in mid-2007.
• We added eight transmission circuit miles to serve
the Freeport liquefied natural gas plant – the first
LNG plant in Texas.
• We made substantial progress on our $90 million
commitment to relocate transmission and
distribution facilities ahead of the Texas Department
of Transportation’s 23-mile reconstruction and
widening of Interstate 10 in Houston.
Electric power
brightens up a new day
7
Our electric transmission and distribution business continued to grow in 2006,
adding more than 37,000 metered residential and small commercial customers.
Operating income was $450 million (excluding the transition bond companies),
up from $448 million in 2005.