HOUSTON – Just days before Houstonians will be able to share their honest thoughts about CenterPoint Energy with the Public Utility Commission of Texas (PUC), the company’s top man, Jason Wells, spoke exclusively with KPRC 2′s Gage Goulding.
Here’s the full interview:
KPRC 2′Gage Goulding: Well, thank you so much for taking the time with us today. I really appreciate it.
Jason Wells/CEO, CenterPoint Energy: It’s my pleasure.
Gage Goulding: So, let’s start out with—I think the biggest thing that we’ve heard from our viewers in the Houston community—These allegations from the city of Houston and 40 other communities that CenterPoint Energy has been overcharging customers to the tune of about $100 million a year. Is that happening? What’s your response?
Jason Wells/CEO, CenterPoint Energy: You know, we want to work with all of our stakeholders on what is a fair rate for our service. I don’t think that we’re overcharging our customers $100 million. I know there’s been some frustration with our withdrawal of our rate case, and I think it’s helpful to put a little context behind that.
Our rates are set in a very public process with our regulator. We often seek recovery throughout the year for our capital investments. The rate case that we filed, we have to file once every four years, and that really sets the profit on those capital investments.
During this process, this this past year. Every single intervener that perpetuated that rate case actually supported a higher level of profit of the investments we’re making in our system. And given the community’s frustration around our response to Hurricane Beryl, now is not the time to talk about higher profits.
So, we withdrew the rate case so we could focus on making these critical investments to improve our service.
Gage Goulding: And this was something that I was even confused, about being on the inner workings of it.
There was the rate hike and then the withdrawal, and then there was an increase in September. So, can you help us understand what exactly that means? Why was that increase implemented in September?
Jason Wells/CEO, CenterPoint Energy: Yeah. You know, there’s a number of things that impact our rates. Some of those things are outside of our control.
The way that the transmission lines—the large lines that move power across the state of Texas—those lines are often shared. It’s a shared cost across Texas. And so, as some of our peer utilities modify their rates, those impact our transmission charges.
Other times of the year, we put—as I said—our capital investment, the investments we make to improve our system. We put those into rates.
You know, in the foreseeable future here this year, we’re going to see a rate reduction from some charges rolling off the bill. So, there’s a lot of rate activity that occurs, but all of that occurs with our regulator, governing what we can charge our customers.
Gage Goulding: Hurricane Beryl and the May derecho, really a one-two sucker punch for the Houston metro area. Both of those power outages—those events led to power outages with more than 1 million people, not customers, but people who were without power. Beryl obviously being a lot more.
Do you feel that CenterPoint failed customers during that time period?
Jason Wells/CEO, CenterPoint Energy: I know I personally let our customers down with both of those events. And for that, I’m deeply apologetic.
We will be better. I’m determined to be better—that we will be better. All of the team here at CenterPoint is determined to earn our customer’s trust.
You know, that really began with extensive listening sessions that we initiated right at the conclusion of our restoration activities from Hurricane Beryl and have continued throughout this fall. Hearing directly from our customer[s], the frustrations they have with our service, we’re incorporating that feedback into the plans that we’ve rolled out to develop the most resilient coastal growth grade in the country. We are committed to earning our customer’s trust.
Gage Goulding: Be better. That’s what a lot of people are asking for. And I hear that a lot from CenterPoint. And there’s a lot of ways that, you know, have been outlined, and we’re going to get to those in a little bit.
But one of the ways is hearing what the customers have to say. And there’s an opportunity for folks to talk to the PUC this Saturday. So, I want to know, will CenterPoint reps be there to hear directly from customers this Saturday?
Jason Wells/CEO, CenterPoint Energy: Yes, I will personally be there. Our team will be there. We look forward to every opportunity to gather feedback from our customers.
Gage Goulding: In any hurricane or any natural disaster, any loss is a tragic loss. From our research and data that we’ve been able to collect here at KPRC 2, we know that at least 10 deaths were attributed to hypothermia or dying of overheating.
Do you think CenterPoint has to share the blame for that?
Jason Wells/CEO, CenterPoint Energy: You know, all loss of life is terribly tragic. My heart goes out to those families who have lost their loved ones.
There’s not a day that passes that I personally—that we don’t personally—think about the loss our community experienced, and that is the drive behind our determination to create this most resilient coastal grid in the country.
Gage Goulding: And before we get to that, I want to show up a quick clip. You brought it up. This is where I want to show it.
This is an interview that my colleague Rilwan Balogun did with a woman who lost a loved one. I want to show this to you and genuinely get your raw and honest thoughts.
Gage Goulding: I think that hits on the “We need to do better,” there. Absolutely. Hearing that that is a Houstonian that lost a loved one. Yeah. What’s your reaction?
Jason Wells/CEO, CenterPoint Energy: Absolutely.
Gage Goulding: Hearing that—that is a Houstonian that lost a loved one. What’s your reaction?
Jason Wells/CEO, CenterPoint Energy: I just... I’m so deeply sorry. Any loss of life is incredibly tragic. Obviously—emotionally—that, you know, that hits me in the stomach. And that is why we are so determined to build the grid that our customers expect and deserve.
Gage Goulding: And I’ve had the pleasure of covering several stories and tagging along with CenterPoint crews as they’ve gone through the first step and now into the second step of this resiliency plan. In your words—in a short version, in the one sentence, if you could—what is the resiliency plan for the future of CenterPoint Energy in the Houston area?
Jason Wells/CEO, CenterPoint Energy: It’s creating a grid that can take a punch and get back up as quickly as possible.
Gage Goulding: How are we doing that? How have we done it, and how are we going to do it?
Jason Wells/CEO, CenterPoint Energy: You know, in terms of how we’ve done it:
We made significant investments in our transmission system and our substation. That’s really the backbone of this electric grid. That moves the most amount of power across our communities, and the investments we made to hard in that system stood out both in the derecho and in Beryl. We had very little structural damage.
The next frontier is really building the distribution grid of the future.
And, you know, that activity is replacing some of the older utility poles with composite poles, stronger wood poles to withstand extreme winds. Some of that is burying our equipment underground. A lot of it is trimming trees back and making sure that they’re not a risk to our electric service.
And then the thing that I’m most excited about, that we’ve just announced this week, is the rollout of equipment that’s going to create a self-healing grid.
Many of the outages our customers experience don’t result in damage. Our crews need to go out, though, and close the fuses and restore power.
There’s equipment that we are going to blitz our system with before June 1st of next year that will automatically restore power without having to send a crew. And in the cases where there’s actually damage, this equipment can reroute power to isolate that damage to the fewest possible customers and again, re-energize for the rest of the customers who aren’t impacted by that damage. And so, I think that is going to be the game-changer for our customers going forward.
Gage Goulding: As I say, we see work behind us now replacing poles behind where we’re at right now, which is right across the street from one of your offices. So, there’s no, you know, where this work needs done has no limits. It’s really anywhere.
Jason Wells/CEO, CenterPoint Energy: That’s right.
Gage Goulding: When it comes to that next storm, it’s not if; it’s when.
Whether it be a derecho or a hurricane or maybe even a winter storm, do you truly think that CenterPoint is ready to handle that? And is the infrastructure ready to take another punch?
Jason Wells/CEO, CenterPoint Energy: Yeah. We’ve heard the call to action and the incredible amount of work our crews did during the month of August—really a Herculean level of work—has really positioned our system to take that punch better.
And I’m confident as we blitz our system with this technology that will create this self-healing grid, that will even be better prepared as we start next hurricane season.
Gage Goulding: And I want to quote you from a news release that we received. You said, “We have heard the calls for change, and we are taking action now.”
And we’ve seen that action. We saw that that first phase of the resiliency plan be completed. We saw a second phase be rolled out, and we just recently talked about how [artificial intelligence] is being used to identify vegetation. So, there are a lot of things happening right now. But will things continue to happen in the future?
Jason Wells/CEO, CenterPoint Energy: That’s right. You know, we rolled out an action plan, because what we had heard immediately after Beryl, is our customers were afraid.
They had anxiety for the remainder of this year’s hurricane season. That’s what that work was targeted to address in August.
We knew we weren’t done. The second phase is getting us ready for next hurricane season, and the third phase that we will roll out at the end of January of [2025] will be that longer term plan that really will deliver that most resilient coastal area that we have promised.
Gage Goulding: And I want to talk about something personal now, going through both of these. I know you just assumed the role of CEO in January and you were kind of lunged into this position here.
Jason Wells/CEO, CenterPoint Energy: Yeah.
Gage Goulding: How have you taken having a double punch as the top dog at our largest utility here? How have you been handling it?
Jason Wells/CEO, CenterPoint Energy: That’s my job. You know, I had the privilege to work with an amazing team. The men and women that do this work every day are committed to the neighbors they have the privilege to serve.
It’s my job to take this feedback—ensure they have the resources to make sure for the next storm we’re better prepared and we respond faster.
So, I’m happy to take that that pressure, so the men and women at CenterPoint can do the work that our community expects and deserves.
Gage Goulding: We touched on it earlier. There’s a lot of distrust right now between the Houston area and CenterPoint. How do you plan on restoring that trust?
Jason Wells/CEO, CenterPoint Energy: I believe strongly in a, you know, a do/say ratio of one.
And I think that’s what you saw when we first rolled out the first phase of our Greater Houston Resiliency initiative. We outlined a series of work, and we reported against it every day to make sure that we held ourselves accountable to our promises.
You’ll see that in the second phase of work in the Greater Houston Resiliency Initiative, and you’ll see it as we roll out that third and final phase.
I believe that making sure that we execute on the actions we commit to is that first step of beginning to rebuild trust.
Along the way, we want to hear from our communities. You know, we’ve conducted over 19 sessions—listening tours, if you will—with our customers, you know, in their communities.
We’re not done. We’re going to continue that work throughout the year. Building a level of familiarity, relationships, understanding what our communities need. And I think it’s the combination of those things that will, over time, we earn our customers trust.
Gage Goulding: Like I said, you just assumed this role in January. And I can only imagine it must be one of the weirdest questions to be asked. But a lot of people, including state leaders, were asking, “Why don’t you resign?” And I like this quote that you said to the Senate committee, “I think if I resigned today, we lose momentum on the things that are going to have the best possible impact for the greater Houston region.”
Jason Wells/CEO, CenterPoint Energy: Yeah.
Gage Goulding: Do you still believe that to be true? And give me the backstory on your thoughts on that. Because that’s a strong statement.
Jason Wells/CEO, CenterPoint Energy: Yeah, absolutely.
I believe it stronger today than even when I said it then. I’ve had the privilege of being in this industry for 25 years. I’ve seen how this industry runs to the challenge.
The men and women that came from across the country to help us restore our service. I can’t do that work. But that spirit of running towards the challenge has rubbed off on me.
I know that we can rely on our community’s trust here. We’ve kind of talked about it. It’s not just the investment. It’s not just listening tour. It’s bringing technology that will help us move faster and deploy these hardening investments on a more targeted basis. It’s a combination of those activities that I’m confident we’ll build a system that our customers expect of us.
Gage Goulding: No two storms are alike, but Hurricane Beryl and Hurricane Helene had a very different proactive miss versus reactive miss.
We saw a lot of state federal mutual aid resources for Hurricane Helene being staged beforehand, where with Beryl—quite frankly—it danced up the coast, and we were the unlucky ones that got hit by it.
I want your honest thoughts. Do you think that had an impact on the reactiveness to get the power restored? If those resources would have been staged beforehand and there would have been help beforehand—would that have made the response a little bit better?
Jason Wells/CEO, CenterPoint Energy: You know, in retrospect, we could always bring more resources to bear. We had pre-staged a significant number of resources. We were tracking barrel for nine days before it made landfall. And as you mentioned, for seven of those nine days, it looked like it was going to hit south of us.
We were really, you know, monitoring that for a response to the gas systems we have the privilege to operate down or near the Corpus area, but we were tracking it for its impact on Houston. As soon as we started to see that it was shifting north, we pre-staged in our resources.
We wouldn’t have been able to restore a million customers in 48 hours had we not pre-staged crews Again, more resources would have helped. I think that’s the real action that’s going to drive change for our customers is again, delivering that self-healing grid to reduce the number of outages so that the crews that are coming to restore have a concentrated area to focus on and can get the service restored faster.
Gage Goulding: Your men and women are working right now to continuously make a more resilient grid. But at the same time, you have crews helping out those that are impacted by Hurricane Helene. That’s a talk to the note of how it’s just really, “You scratch my back, I scratch yours.”
Jason Wells/CEO, CenterPoint Energy: It’s a hallmark of our industry. We’re in this together. We take a great amount of pride to running towards that challenge, as I mentioned. We’ve got about a third of our internal workforce, native contractors, our employees that are in the Southeast, helping with the restoration efforts. We’re returning that favor, because the industry ran to Houston to help us in our time of need with Beryl.
We’re in this together as an industry. And I think it is, you know, one of the distinguishing aspects of the electric industry.
Gage Goulding: Those crews have a monumental task ahead of them. Really, kind of a demolition and a reconstruction of their electrical infrastructure up there. Is Center Point watching to see if there’s anything that we can do here and learn from what they’re going through.
Jason Wells/CEO, CenterPoint Energy: Absolutely. You know, one of my areas of focus is instilling a learning culture.
You know, Florida, as an example, was impacted by a series of hurricanes in 2004, 2005. And it was really their call to action. After our experience with Hurricane Beryl this summer, we brought a number of their retired executives who were part of the strategy of hardening their grid, asking for their best practices, trying to learn from that. We’re using the example with Helene to learn as well.
You know, there are there is work that is being done around the country to accelerate the use of AI. We’re learning from those peers. We’re announcing partnerships, like the one you highlighted yesterday. It’s learning from all of these different experiences that’s going to deliver the grid that our customers expect.
Gage Goulding: And my final question, and maybe my most important question. It isn’t an answer I want you to give me, but to Houston right here, right now.
What is your promise to Houstonians far and wide for how CenterPoint will handle them and take care of them in their time of need?
Jason Wells/CEO, CenterPoint Energy: We will absolutely be better. We will be the utility, the company, that our customers expect of us. We’ll be there, understanding the needs in their community before a storm hits. We will have less outages. We will restore faster, and we will be empathetic to the experiences that they have.
We will be a good neighbor, if you will, for our community that we have the great privilege to serve.
Gage Goulding: Is there anything that I didn’t ask that you wanted to mention? I know we touched on a lot of topics in a short time, but is there anything that you directly wanted to bring up?
Jason Wells/CEO, CenterPoint Energy: I continually want to recognize the incredible work of the men and women that work on our system each and every day. They work through incredibly tough conditions and, in some cases during Hurricane Beryl, face the threats of violence. And, you know, that’s counterproductive to the restoration efforts. It disrupts the workflow, slows down. There’s really no place for that violence, right?
These men and women are committed to restoring power, serving the community that they call their neighbors and friends. And so, I think we should really celebrate them as opposed to expressing any frustration towards, you know, the number of outages that we’ve experienced. That is something that I need to address, and I am happy to stand accountable for outages, improvement and delivering the grid that our customers expect of us.
Gage Goulding: Mr. Wells, thank you.
Jason Wells/CEO, CenterPoint Energy: I really appreciate your time.
Gage Goulding: Thank you.