LUBBOCK, TX (KCBD) - NewsChannel 11 has received the official press release on the City of Lubbock purchasing Xcel Energy. Here is the official statement:
Representatives from Lubbock Power & Light (LP&L), Xcel Energy and the City of Lubbock made an announcement today that will lay the foundation for the future of power in Lubbock.
LP&L and Xcel Energy have reached a mutually beneficial agreement that will allow LP&L to purchase Xcel Energy's electricity distribution system within the city and to serve all of Xcel Energy's Lubbock retail electric customers. Since 1942 Lubbock has been served by both companies, resulting in duplication of electric power services, lines, poles and substations. Both companies have determined this to be an inefficient and intrusive way to provide electricity to the community.
"The duplication of retail electric service in Lubbock has not been efficient, and we believe we can best serve Lubbock and our other Texas retail customers by only providing the low-cost wholesale electricity to LP&L," said David Eves, president and CEO of Southwestern Public Service (SPS), an Xcel Energy company. "Xcel Energy customers in Lubbock will be served by LP&L, but Xcel Energy will continue to supply the wholesale power and transmission services."
Currently LP&L provides power to more than 77 percent of households in Lubbock but purchases its power wholesale from Xcel Energy.
"It's natural for LP&L to pick-up the Xcel retail electric service, since the City of Lubbock already provides utility service to all the properties in Lubbock," Mayor Tom Martin said.
Because LP&L will use its solid financial position and bond ratings to fund the purchase through electric revenue bonds, electric rates for their customers will remain some of the lowest in the state.
"We want all our customers to know that your electric rates will not increase as a result of this new relationship. LP&L electric customers will continue to see low electric rates," W.R. Collier, LP&L Electric Utility Board Chairman, said.
Electric customers in the Panhandle and South Plains enjoy some of the lowest electric rates in Texas because of Xcel Energy's low-cost power generation system and abundant renewable resources. Xcel Energy will remain a significant part of the Lubbock community and will continue its civic involvement in Lubbock as a regional hub of operations and as a wholesale electricity provider for LP&L and retail provider in other areas of the South Plains.
Xcel Energy has received approval from the Xcel Energy Board of Directors to proceed with the sale of these assets, and the company is expected to gain regulatory approvals within the next nine months. LP&L will be seeking approval from the LP&L Electric Utility Board and the Lubbock City Council.
"This decision was made in the best interest of the citizens of Lubbock as well as in the best interest of dozens of Texas and New Mexico communities where Xcel Energy will remain the sole retail provider. This will not be an immediate change, and we will do everything we can to make this transition as smooth as possible for our customers," Eves said.
LP&L and the City were advised by RBC Capital Markets with respect to financial matters, R.W. Beck with respect to operational matters and Vinson & Elkins with respect to legal matters.
Customers with questions regarding their service are encouraged to contact their current electricity provider.
NewsChannel 11 will continue to follow all aspects of this developing story. Stay with NewsChannel 11 and kcbd.com for the latest.
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