A state regulatory hearing on the proposed $4.3 billion sale of El Paso Electric has been postponed to Thursday because substantial progress has been made in negotiating a final deal.   

The Public Utility Commission of Texas early Thursday morning approved a request by El Paso Electric; the Infrastructure Investments Fund, (IIF) which is planning to buy the utility; the city of El Paso; the PUC staff and the Texas Industrial Energy Consumers to postpone the start of the hearing from Wednesday to Thursday morning so negotiations can continue for a settlement of the case pending before the PUC.

Lino Mendiola, a lawyer for the J.P. Morgan Chase-advised investment fund, said during a pre-hearing conference in Austin on Wednesday that over many days of negotiations, the parties involved with the proposed sale have "closed the gap" on most of the issues tied to the proposed sale, and that the parties were close to coming up with a term sheet of conditions for the proposed sale.

Mendiola told a state administrative law judge at the pre-hearing conference that it is possible the parties would file another motion later to further delay the hearing if negotiations were successful.

The PUC was scheduled to begin the three-day hearing today to help it determine if the sale should be approved, modified or denied. 

Consultants for the PUC staff, the city of El Paso, the Texas Industrial Energy Consumers, and the Rate 41 Group of El Paso area school districts, and attorneys for the Texas Office of Public Utility Counsel have concluded that the sale as proposed would not be in the public interest, which is required for PUC approval.

The consultants have proposed a long list of additional conditions in order for the sale to meet the public interest standard.