EL PASO, TX – El Paso Electric Utility (EPE) issued a statement regarding the proposed municipalization of the company, noting that the action would result in a series of complications in providing service to customers.
EPE pointed out that up to now, the company provides service to approximately 500,000 customers from Hatch, New Mexico, to Van Horn, Texas. However, municipalization in the City of El Paso (City) would separate a portion of the company’s assets to create two utilities in the region: one for customers living within El Paso city limits and another for those outside, which includes New Mexico and Texas.
“It is unclear how customers in the city of El Paso would be served, as most of EPE’s power generation resides outside the city and EPE has committed generation and transmission resources to serve both our Texas and New Mexico customers,” the company highlighted in a statement.
EPE is currently highly regulated by local, state and federal entities to ensure the affordability and reliability of the power it supplies. These regulatory bodies determine what investments are prudent and how much the utility can earn.
In addition, the company asserted that city oversight of a small municipal utility with limited generation assets can result in increased risks to customer rates, as well as uncertainty around providing safe and reliable service.
EPE stated that since the owner is not selling voluntarily, the city would be forced to expropriate the company’s assets within the city limits through a lengthy and complex process that would incur significant costs to both the company and the City that would be paid by ratepayers.
The Utility stated that the proposal does not clearly estimate any of the aforementioned costs, so it was confident that the municipalization efforts would not be successful.
It also assured that it has begun preparing for the future by planning its entire grid for more renewable generation and electrification. In fact, EPE highlighted that it will be making significant investments of over $2 billion in the coming years in infrastructure improvements, i.e., cybersecurity, smart grid and fuel diversity.
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