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TITLE 16ECONOMIC REGULATION
PART 2PUBLIC UTILITY COMMISSION OF TEXAS
CHAPTER 25SUBSTANTIVE RULES APPLICABLE TO ELECTRIC SERVICE PROVIDERS
SUBCHAPTER ECERTIFICATION, LICENSING AND REGISTRATION
RULE §25.108Financial Standards for Retail Electric Providers Regarding the Billing and Collection of Transition Charges

  (8) Metering data. If the servicer is providing the metering, metering data will be provided to the REP at the same time as the billing. The REP will be responsible for providing the servicer accurate metering data (including meter identification information) for all REP's customers whose meters are not read by the servicer at the time the data is provider to the independent organization (as defined in PURA §39.151(b)) under the independent organization's protocols for settlement.

  (9) Charge-off allowances. The REP will be allowed to hold back an allowance for charge-offs in its payments to the servicer. Such charge-off rate will be recalculated each year in connection with the annual true-up procedure. In the initial year, REPs will be allowed to remit payments based on the same system-wide charge-off percentage then being used by the servicer to remit payments to the indenture trustee for the holders of transition bonds; thereafter the charge-off percentage will be calculated based upon each REP's prior year charge-off experience. On an annual basis in connection with the true-up process, the REP and the servicer will be responsible for reconciling the amounts held back with amounts actually written off as uncollectible in accordance with the terms agreed to by the REP and the servicer, provided that:

    (A) The REP's right to reconciliation for charge-offs will be limited to customers whose service has been permanently terminated and whose entire accounts (i.e. , all amounts due the REP for its own account as well as the portion representing transition charges) have been written off.

    (B) If the REP's actual charge-offs are greater than the allowance for charge-offs, the REP may collect the difference, with interest, from the date the review was completed, in 12 equal monthly installments beginning in the month that the transition charges are adjusted to reflect the new charge off percentages. The REP's recourse will be limited to a credit against future transition charge payments unless the REP and the servicer agree to alternative arrangements, but in no event will the REP have recourse to the indenture trustee, the "SPE" or the SPE's funds for such payments and the indenture trustee and SPE shall not be liable for such amounts. If the REP's actual charge-offs are less than the allowance for charge-offs, the REP shall pay the difference, with interest, from the date the review was completed, in 12 equal monthly installments beginning in the month that the transition charges are adjusted to reflect the new charge-off percentages. The interest rate on amounts due to or from the REP under this paragraph shall be the interest rate in effect pursuant to Texas Utilities Code §183.003 on the date the annual reconciliation is made. REP and servicer shall each have the unilateral right to prepay any amounts due hereunder and thus avoid continued accrual of interest.

    (C) The REP shall provide ' the servicer a list of all charge-offs qualifying for reconciliation under subparagraph (A) of this paragraph, and documentation permitting servicer to verify that service to the customer has been terminated and all amounts due the REP from such customers have been written off. The information shall be provided not later than 30 days prior to the date on which the annual true-up adjustment is to be filed and shall cover the most recent 12-month period for which data is available at the time of submission. The information to be provided by the REP shall include data demonstrating that the REP has not collected any amounts the REP claimed as charge-offs in prior periods, or, if any amount previously charged-off has been collected, quantifying the revenues. The REP's rights to credits will not take effect until adjusted transition charges reflecting the REPs charge-off experience have been implemented.

  (10) Service termination. In the event that the servicer is billing customers for transition charges, the servicer shall have the right to terminate transmission and distribution service to the end-use customer (or if the servicer is not the transmission and distribution utility to direct the transmission and distribution utility to terminate service to the end-use customer) for non-payment by the end-use customer pursuant to applicable commission rules. In the event that a REP or the POLR is billing customers for transition charges, the REP shall have the right to transfer the customer to the POLR (or to another certified REP) or to direct the transmission and distribution utility to terminate transmission and distribution service to the end-use customer for non-payment by the end-use customer pursuant to applicable commission rules. In the event that the POLR is billing customers for transition charges, the POLR shall have the right to direct the transmission and distribution utility to terminate transmission and distribution service to the end-use customer for non-payment by the end-use customer pursuant to applicable commission rules.

  (11) Precedence and modifications of REP standards in a financing order.

    (A) Compliance with financing order standards. If the REP standards in the applicable financing order are in direct conflict with the standards in this section, then the REP must comply with the REP standards stated in the financing order, instead of the standards stated in this section, unless the standards of the financing order have been modified and approved according to subparagraph (B) of this paragraph.

    (B) Commission modification of standards. The commission may impose standards on REPs that are different from those in the applicable financing order but only if the commission receives prior written confirmation from each rating agency that rated the transition bonds authorized by that financing order that the proposed modifications will not cause a suspension, withdrawal, or downgrade of ratings on the transition bonds.


Source Note: The provisions of this §25.108 adopted to be effective August 15, 2000, 25 TexReg 7639

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