Texas Border Business
On August 10, 2015, El Paso Electric (EPE) filed a proposed rate increase for all customers with the City of El Paso, municipalities incorporated in its Texas service territory, and the Public Utility Commission of Texas (PUCT) in Austin. Under the proposed rates, a residential customer using 625 kilowatt-hours per month will see an average bill increase of $8.41 per month when new rates become effective in 2016.
“At El Paso Electric, we understand that no one likes it when bills go up and our obligation to provide clean, safe and reliable energy to all customers at an affordable cost is a responsibility we take very seriously,” said Tom Shockley, El Paso Electric CEO. “We have filed for a proposed rate increase in both Texas and New Mexico to recover the cost-effective investments we have made to replace less efficient equipment and build new generation for our community’s economic and population growth.”
Since 2009, EPE has invested approximately $1.3 billion in new assets to meet the growth within our region and improve grid reliability. Key investments include the Montana Power Station generating units 1 and 2, the Eastside Operations Center and the Montana Power Station transmission lines. EPE last raised its rates in Texas in 2010 and previous to this increase, EPE had not raised rates since 1994.
“By carefully evaluating all customer classes, their usage, and their cost to serve, we have determined the new proposed rates,” added Shockley. “Although this process can take anywhere from six months to one year for there to be a final decision, we want to be sure that our customers know exactly what is happening with their utility, especially when bills may be going up.”
In a simultaneous process, we filed the rate case with the City of El Paso, municipalities in our Texas service territory, and the PUCT. The PUCT will refer the case to the Texas State Office of Administrative Hearings which will then appoint an administrative law judge. A discovery process will follow in which intervening parties have the opportunity to communicate and engage in the process. The procedural schedule issued by the administrative law judge will establish a timeline for testimony and hearings, which are expected to be held during the winter of 2015. We anticipate rates will become effective by early second quarter 2016.
“The rate case process is transparent, and in order to make sure we do not collect a single penny that is not justified, all parties are represented in the process,” said Shockley. “As your local utility, we have a responsibility and obligation to serve all our customers. In order to do so, we must be a financially viable company, able to take care of our customers and employees that live and work in the region we serve.”
The cities and towns in our Texas service territory maintain their right to regulate this rate case process and make a decision on rates within their city limits. Regardless of decisions made by municipalities, the PUCT has appellate jurisdiction and decides the rate request. Any municipality can participate in the proceeding before the PUCT as an intervening party in Austin where a final decision on this rate case will be made.
