CenterPoint Energy Projects Up to $1.3 Billion in Restoration Costs Following Hurricane Beryl, According to Reuters

By Vallari Srivastava

Electric and gas utility CenterPoint Energy has announced its expectation that total costs to restore facilities damaged by Hurricane Beryl will fall between $1.2 billion and $1.3 billion.

Hurricane Beryl made landfall earlier this month near Matagorda, Texas, resulting in considerable damage to the delivery system of CenterPoint’s electric subsidiary. The company also anticipates additional costs ranging from $425 million to $475 million related to storm events that took place in May.

During a post-earnings call, CenterPoint indicated that these storm-related expenses could increase average residential electric bills by approximately 2%. As a result, the company’s shares dropped by 1.6% in afternoon trading.

According to Scotiabank analyst Andrew Weisel, Hurricane Beryl is putting pressure on CenterPoint’s financial standing and may influence its upcoming rate case filings in Houston. He noted that customer satisfaction and public perception of the utility have suffered due to the widespread power outages.

Utility companies typically utilize rate case proceedings to justify electricity price hikes to secure funding for transmission and service costs.

In a related development, restaurants in Houston and its vicinity have filed a lawsuit against CenterPoint Energy, claiming over $100 million in damages. They allege that the utility’s negligence and incompetence hindered timely power restoration following Hurricane Beryl.

CenterPoint Energy, which serves approximately 2.9 million electric customers in the greater Houston area and parts of southwestern Indiana, also shared plans to mitigate risks associated with future storms.

In its second-quarter results, the company reported a net income available to common shareholders of $228 million, or 36 cents per share, up from $106 million, or 17 cents per share, year over year. This growth was largely driven by increased electricity demand during the peak summer months.