HOUSTON, Feb 12, 2008 (PrimeNewswire via COMTEX News Network) -- CenterPoint Energy, Inc. (NYSE:CNP) announced today that CenterPoint Energy Transition Bond Company III, LLC has closed on $488 million in transition bonds with an effective annual weighted average interest rate of 4.8 percent. The Transition Bond Company is a special purpose subsidiary of CenterPoint Energy's electric transmission and distribution subsidiary, CenterPoint Energy Houston Electric, LLC (CEHE).
Issuance of these bonds, also known as securitization bonds, was authorized by a financing order from the Public Utility Commission of Texas (Commission) and is an important step in the transition to a competitive retail electric market that was begun in 2001. As in the case of the two previous issuances of transition bonds by subsidiaries of CEHE, the principal and interest on the bonds are recovered under a Transition Charge, which is added to the electric delivery rate paid by retail electric providers to CEHE for power delivered to Houston-area customers. The Transition Charge, which replaces the current Competition Transition Charge (CTC), will begin now that the bonds have closed.
"When compared to the current CTC, these transition bonds are estimated to save customers approximately $100 million over the life of the bonds. These bonds represent a significant customer benefit of legislation passed in 2007," said Marc Kilbride, vice president and treasurer for CenterPoint Energy. "We are pleased that we were able to sell the bonds at favorable interest rates. We appreciate the leadership of Chairman Smitherman and the other members of the Commission and its staff in getting these bonds to market."
Proceeds from the transition bond issuance will be used as required in the 1999 Texas electric restructuring law.
This news release does not constitute an offer to sell, or the solicitation of an offer to buy, any security and shall not constitute an offer, solicitation or sale in any jurisdiction in which such offering would be unlawful.
CenterPoint Energy, Inc., headquartered in Houston, Texas, is a domestic energy delivery company that includes electric transmission & distribution, natural gas distribution, competitive natural gas sales and service, interstate pipelines and field service operations. The company serves more than five million metered customers primarily in Arkansas, Louisiana, Minnesota, Mississippi, Oklahoma, and Texas. Assets total over $17 billion. With about 8,600 employees, CenterPoint Energy and its predecessor companies have been in business for more than 130 years. For more information, visit www.CenterPointEnergy.com.
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This news release includes forward-looking statements. Actual events and results may differ materially from those projected. The statements in this news release regarding future events and other statements that are not historical facts are forward-looking statements. Factors that could affect actual results include the financial performance of CenterPoint Energy, the timing and impact of future regulatory decisions, and other factors discussed in CenterPoint Energy's Form 10-K for the period ended Dec. 31, 2006, and Form 10-Qs for the periods ended March 31, June 30, and Sept. 30, 2007, and other filings with the Securities and Exchange Commission.
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SOURCE: CenterPoint Energy, Inc.
CenterPoint Energy, Inc. Media: Floyd LeBlanc 713-207-7125 Investors: Marianne Paulsen 713-207-6500
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