CenterPoint Energy 2008 Annual Report Download - page 43

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C. Gregory Harper has served as Senior Vice President and Group President of CenterPoint Energy Pipelines
and Field Services since December 2008. Before joining CenterPoint Energy in 2008, Mr. Harper served as
President, Chief Executive Officer and as a Director of Spectra Energy Partners, LP from March 2007 to December
2008. From January 2007 to March 2007, Mr. Harper was Group Vice President of Spectra Energy Corp., and he
was Group Vice President of Duke Energy from January 2004 to December 2006. Mr. Harper served as Senior Vice
President of Energy Marketing for Duke Energy North America from January 2003 until January 2004 and Vice
President of Business Development for Duke Energy Gas Transmission and Vice President of East Tennessee
Natural Gas, LLC from March 2002 until January 2003. He currently serves on the Board of Directors of the
Interstate Natural Gas Association of America.
Thomas R. Standish has served as Senior Vice President and Group President-Regulated Operations of
CenterPoint Energy since August 2005, having previously served as Senior Vice President and Group President and
Chief Operating Officer of CenterPoint Houston from June 2004 to August 2005 and as President and Chief
Operating Officer of CenterPoint Houston from August 2002 to June 2004. He served as President and Chief
Operating Officer for both electricity and natural gas for Reliant Energy’s Houston area from 1999 to August 2002.
Item 1A. Risk Factors
We are a holding company that conducts all of our business operations through subsidiaries, primarily
CenterPoint Houston and CERC. The following, along with any additional legal proceedings identified or
incorporated by reference in Item 3 of this report, summarizes the principal risk factors associated with the
businesses conducted by each of these subsidiaries:
Risk Factors Affecting Our Electric Transmission & Distribution Business
CenterPoint Houston may not be successful in ultimately recovering the full value of its true-up components,
which could result in the elimination of certain tax benefits and could have an adverse impact on CenterPoint
Houston’s results of operations, financial condition and cash flows.
In March 2004, CenterPoint Houston filed its true-up application with the Texas Utility Commission, requesting
recovery of $3.7 billion, excluding interest, as allowed under the Texas electric restructuring law. In December
2004, the Texas Utility Commission issued its True-Up Order allowing CenterPoint Houston to recover a true-up
balance of approximately $2.3 billion, which included interest through August 31, 2004, and provided for
adjustment of the amount to be recovered to include interest on the balance until recovery, along with the principal
portion of additional EMCs returned to customers after August 31, 2004 and certain other adjustments.
CenterPoint Houston and other parties filed appeals of the True-Up Order to a district court in Travis County,
Texas. In August 2005, that court issued its judgment on the various appeals. In its judgment, the district court:
• reversed the Texas Utility Commission’s ruling that had denied recovery of a portion of the capacity
auction true-up amounts;
• reversed the Texas Utility Commission’s ruling that precluded CenterPoint Houston from recovering the
interest component of the EMCs paid to REPs; and
• affirmed the True-Up Order in all other respects.
The district court’s decision would have had the effect of restoring approximately $650 million, plus interest, of
the $1.7 billion the Texas Utility Commission had disallowed from CenterPoint Houston’s initial request.
CenterPoint Houston and other parties appealed the district court’s judgment to the Texas Third Court of Appeals,
which issued its decision in December 2007. In its decision, the court of appeals:
• reversed the district court’s judgment to the extent it restored the capacity auction true-up amounts;