Community leaders from across Harris County are calling for the ouster of embattled CenterPoint Energy CEO Jason Wells as elected officials continue to blast the company’s lack of preparation for and inadequate response to Hurricane Beryl.
In a video posted to social media on Sunday, Gallery Furniture owner Jim “Mattress Mack” McIngvale and popular Houston-area social media personality “Grizzy” Castillo excoriated Wells and CenterPoint, interjecting chants of “Hey, Hey! Ho, Ho! CenterPoint CEO has got to go!” in their video.
“CenterPoint CEO Jason Wells promised no excuses following Hurricane Beryl, where over 2.2 million Houstonians lost power for up to a week to 10 days, resulting probably in at least several exposure deaths. Despite this, he still makes millions. This is his legacy,” said Mattress Mack.
Grizzy added, “We demand better leadership that puts people over profits. CenterPoint executives resign now. It’s time for new management that truly cares about the people of Harris County.” McIngvale and Castillo also encouraged viewers to sign an online petition started by McIngvale calling for Wells’ removal as CEO of Centerpoint. As of the publication of this article, the online petition had received more than 6,000 signatures.
At a hearing of the State Senate Special Committee on Hurricane and Tropical Storm Preparedness, Recovery, and Electricity, State Senator Paul Bettencourt asked Wells to respond to calls for his resignation from McIngvale. Wells rejected the calls for his resignation, saying it would negatively impact the work he says is currently being done to remedy the problems his critics blame him for causing.
“I think if I resign today, we lose momentum on the things that are going to have the best possible impact for the greater Houston region,” Wells told the committee.
Calls for Wells’ ouster intensified after a CenterPoint investor call Tuesday morning. In it, the company announced that it expected to increase the dividends paid to shareholders while passing along costs incurred as a result of Hurricane Beryl recovery efforts to its customers.
Grizzy and Matteess Mack posted a follow-up video following CenterPoint’s earnings call, reiterating their demands for Wells’ removal.
“On a CenterPoint earnings call, they had the audacity to talk about increasing dividends and pushing rate hikes on Houstonians. They are completely out of touch with their customer base,” said Grizzy.
“No rate hikes! No dividends!” exclaimed Mattress Mack. “Centerpoint executives, you are clueless. You have no soul.”
Alexandra del Moral Mealer, the Chair of the Public Safety Committee for the Metropolitan Transit Authority of Harris County and 2022 Republican nominee for Harris County Judge published a scathing op-ed documenting several years of “failed leadership” at CenterPoint, which resulted in four different CEOs over a four-year period, and calling for a change in executive leadership at the company.
Mealer’s op-ed, published in advance of Wells’ scheduled testimony in front of the Texas House of State Affairs committee, is included below:
No Excuses – Accountability Starts at the Top
As Houstonians recover from Hurricane Beryl, a CAT 1 storm that knocked out power to over 2.2 million Houston-area customers and resulted in 7 heat-related deaths, CenterPoint Energy (“CenterPoint”) executives recently made their way to Austin, TX to answer questions before the Texas Public Utility Commission and a Texas Senate committee regarding the company’s preparation and response to the hurricane. While there is certainly plenty of blame to go around, including scrutiny of the various levels of government that were supposed to provide regulatory oversight of this government created monopoly, I believe the immediate focus and responsibility must be placed on the leadership of CenterPoint.
Specifically, the CenterPoint CEO Jason Wells and the Board of Directors—a board that remained silent throughout the failed response to Hurricane Beryl. A board and a management team that on today’s earning call, committed to increasing returns to shareholders via an 8% dividend increase while increasing costs to Houstonians through a proposed 2% rate increase. CenterPoint CEO Jason Wells promises “no excuses,” but what he really means is “no accountability.”
Immediately following a promise to “get better,” a pledge in reference to not only operations but communication, CenterPoint CEO Jason Wells appears to have decided to take advantage of a Friday news dump. This is a tactic often used in crisis communication strategies to bury a story. In this instance, it appears that the CEO and Board of Directors are quietly pushing out the senior vice president of the electric business division, Lynnae Wilson. Leadership, a term of art, means accountability. This includes the Board of Directors – where are they?
The Board’s silence and inaction is deafening. Fundamentally, the CenterPoint of 2024 is not the same CenterPoint that faithfully served the region during natural disasters like Hurricane Harvey and before. Beginning in 2020 during COVID-19, the company began making significant leadership changes, resulting in the loss of institutional knowledge that culminated in a corporate reorganization in 2023. With four CEOs in just under four years, there is little room for continuity or competency. This is a mess of their own making and Houstonians are suffering because of CenterPoint’s failed leadership.
Failed Leadership: Four CEOs in Four Years
- 2019 – CenterPoint Energy acquires Indiana utility Vectren
- For a purchase price of $6BN, CenterPoint expands its electricity and natural gas businesses into Ohio and Indiana
- Overnight, hundreds of employees are jobless, and a new leadership team is formed
- Gregg Knight, with over 10 years of experience at CenterPoint, then Chief Customer Officer, is unceremoniously pushed out of the company
- Lynnae Wilson, Vectren’s vice president, Energy Delivery, is selected to lead the combined company’s Indiana electric utility business
- 2020 – COVID-19 Reorganization
- Scott Prochazka, then CEO and an architect of the Vectren acquisition is escorted out of the building after the March board meeting. The company fails to disclose a reason for his departure although many report that it was a result of a rate-hike defeat following complaints from H-E-B
- John Somerhalder, a board member, is named interim CEO
- Dave Lesar, formerly a Halliburton CEO and Chairman, is selected to serve as CEO several months later
- Jason Wells, current CEO of CenterPoint, first joins the company as CFO following 13 years at PG&E
- Gregg Knight returns to CenterPoint as Executive Vice President of Customer Transformation and Business Services
- 2023 – Succession Planning
- CenterPoint implements a new “streamlined organization structure” as part of succession planning for Dave Lasar’s planned retirement
- Jason Wells, current CEO of CenterPoint, named COO
- Lynnae Wilson, formerly Senior Vice President, Houston Electric, appointed to Senior Vice President, Electric Business
- Scott Doyle, Executive Vice President, Utility Operations departs the company after 17 years and his position is eliminated
- Gregg Knight, Executive Vice President of Customer Transformation and Business Services, departs the company after 12 years and his position is eliminated
- 2024 – CenterPoint Appoints Jason Wells CEO
- Dave Lesar retires from his role as CEO and board member
- Jason Wells assumes role as CEO and board member
With a change in leadership, in the case of CenterPoint, four CEOs in just under four years, it is reasonable to expect a change in priorities and key leadership positions. However, it is not reasonable for a Board, all earning over $300K in annual compensation, to stay silent while the new “streamlined organizational structure” fails Houstonians.
Do they believe CenterPoint’s recent performance reflects operational excellence? Clearly, the Board and management team have been successful in maximizing financial returns, as the company’s stock price reflects. However, at what cost? And what has changed?
Through Hurricane Ike in 2008 and Hurricane Harvey in 2017, much more severe weather events that appeared to be managed considerably better under the previous leadership of CenterPoint. At a minimum, the communication was far better. Now, we know of at least seven Houstonians who died by heat exposure tied to the power outage from Hurricane Beryl. This is a company whose performance has sunk so low that their power outage tracker was beat by a Whataburger app and until recently, had an advertisement encouraging customers to purchase generators on its emergency on-hold line. By the company’s own admission, CenterPoint failed to adequately conduct vegetation maintenance and is now committing to doubling those efforts.
The widespread criticism of the company has been hard earned. It will take more than an apology letter to restore the faith of Houstonians, it will take a change in Executive leadership.
