Title
Approving a settlement agreement between the Alliance of Oncor Cities (AOC) and Oncor Electric Delivery Company LLC regarding Oncor's Statement of Intent to change electric rates in all cities exercising original jurisdiction.
Summary
Oncor filed a Statement of Intent to increase rates by approximately $353 million on or about January 7, 2011. The proposed increase was 12.6% overall, 15% for residential customers. After an extensive review by the Alliance of Oncor Cities, AOC attorneys, and rate consultants in the proceeding pending at the Public Utility Commission of Texas, the parties have reached a settlement on the increase.
The proposed settlement limits Oncor's rate increase to $136.7 million. It will be implemented in two phases: Phase I in effect on July 1, 2011 will increase rates by $93.7 million; Phase 2 will be implemented for the balance of $43 million on January 1, 2012. This helps to lessen the impact of the total rate increase during the summer of 2011. The residential customer will see an increase of around 5%, rather than 15%. Of major interest to the City is the 50% reduction in the proposed increase in the cost of street lighting that was realized during the negotiations. An issue regarding the calculation of franchise fees owed to cities has also been settled to the City's benefit. Oncor cannot file a general rate case before July 1, 2013.
The AOC attorneys believe the proposed outcome is well within the range of likely outcomes from a fully litigated proceeding at the PUC. This settlement minimizes rate case expenses that would accrue during a fully litigated proceeding, while resulting in just and reasonable rates. Additional information is available on the agenda information sheet attached to this agenda item. The tariffs are included as attachments to the resolution.
Prior City Council Action
On January 25, 2011, the City Council approved a resolution which suspended the effective date of Oncor's rate increase filin...
Click here for full text