ITC Holdings (NYSE:ITC) and Entergy (NYSE:ETR) are aiming to close the spinoff of Entergy’s transmission assets to ITC in 2014.
“It is now clear that a 2013 transaction close is not feasible,” a spokesperson for ITC told TransmissionHub. He added that the companies would continue to seek regulatory approvals by Dec. 31, the original deadline for the deal to close. “We believe it is important to obtain regulatory approvals by year-end so that we can accommodate a closing as early as possible in 2014.”
After withdrawing their application in Texas in mid-August, the companies re-filed with the Public Utilities Commission of Texas (PUCT) on Sept. 23. An intervention deadline of Oct. 23 was set after the Oct. 7 prehearing conference (Docket No. 41850).
“All the parties involved are working on a schedule and there may be additional parties because anyone has until the 23rd to intervene,” a spokesperson for the PUCT told TransmissionHub. “It’d be after that deadline to get folks together to work on a schedule that the administrative law judge could approve.”
The spokesperson added that trying for deal close by the end of the year would not allow for a full hearing process.
On Oct. 4, PUCT staff, the Office of Public Utility Counsel, State of Texas’ agencies and institutions of higher education, Occidental Chemical Corporation, Occidental Permian, Occidental Power Marketing, and Texas Industrial Energy Consumers submitted a proposed procedural schedule according to which the intervention deadline would be Nov. 7, with a hearing the week of Feb. 3, 2014.
The transaction, which involves spinning off Entergy’s transmission business and merging it with an ITC subsidiary, needs state regulatory approvals from Arkansas, Louisiana, Texas, Mississippi and Missouri. The City Council of New Orleans also must approve the transaction. The transaction has received antitrust approval, federal regulatory approval from FERC, ITC shareholder approval, a private letter ruling from the Internal Revenue Service.
The PUCT on Aug. 9 authorized the companies to withdraw their original application (Docket No. 41223) after regulators determined they would not be able to consider a mitigation plan intended to protect customers from higher transmission costs, because the plan was submitted after the statutory deadline for submissions in the case. The mitigation plan was included in the Sept. 23 re-filing.
“Our filing in Texas is in many ways the same filing we’d already made, but we made some additions – the additions of the rate mitigation plan and other commitments we made that weren’t allowed on the record in Texas,” Entergy Chairman and CEO Leo Denault said at the Sept. 24 Wolfe Research Power and Gas Leaders Conference.
The New Orleans City Council at its Oct. 10 meeting adopted a resolution to suspend its hearing schedule and provide for the interveners, applicants and council’s advisors to come to an agreement on a new procedural schedule within 14 days, or by Oct. 24.
The Mississippi PSC’s procedural schedule drew to a close on Sept. 25, by which time all evidence had been gathered. There is no required timeframe in which the commission must render a decision, a spokesperson told TransmissionHub on Oct. 1.
ITC and Entergy on Oct. 1 filed with the Arkansas Public Service Commission (PSC) a status report on their progress with the transaction. In the report they said they had begun to reach out to other parties to discuss hearing dates.
The Arkansas and Louisiana PSCs in late August suspended their procedural schedules, saying that they would adopt new schedules when the companies re-filed their application with Texas regulators.