LUBBOCK, Texas (KCBD) - In a special meeting Thursday, Lubbock City Council is set to approve a $77.5-million buyout, terminating LP&L’s 25-year contract with Southwestern Public Service.
LP&L is currently paying SPS more than $17 million a year in capacity costs for the right to purchase electricity. That contract began in 2019 and is set to run through 2044.
Under a settlement agreement up for approval Thursday, long-term bonds will fund the buyout, totaling $4.1 million a year.
In January 2018, city council and the Electric Utility Board signed resolutions of intent to bring competitive retail electricity back to Lubbock. The contract between LP&L and SPS tied Lubbock to the Southwest Power Pool, where competition is unavailable. The termination of the contract will allow the remaining 30% of customers to migrate to ERCOT in a couple years.
We tried to talk to LP&L and the EUB about this contract, but only received a statement from spokesman Matt Rose:
“Over the past year, Lubbock Power & Light and Southwestern Public Service have worked together to come to an agreement on a matter of importance to both utilities. We look forward to publicly discussing this matter in detail at our meeting on Thursday.”
Once the state’s Public Utility Commission approves this second phase of the Lubbock to ERCOT transition, it’s set to take place in May 2023.
Phase 2 would put all customers in Lubbock on the same power grid.
If city council and the EUB agree to opt-in to the retail competitive market, customers would be able to choose their electric provider.
Lubbock would resemble other cities where competition exists, like Dallas, Houston, Midland/Odessa and Abilene.
City council and the EUB will begin their discussions Thursday at 12 p.m.
You can attend the meeting in the city council chambers at Citizens Tower or over Zoom.
This weekend, the transition to ERCOT begins with 70 percent of Lubbock’s electric load making the shift.
You can see if you’re included in that on the LP&L website using your meter number.