EL PASO, TX – The El Paso City Council has decided to intervene in El Paso Electric’s (EPE) proposed US$93 million rate increase, which is a 90-day suspension to avoid an immediate financial burden on residents. The action will allow for a detailed review process prior to any adjustment.
EPE’s request consists of two main components: an US$85.7 million increase in general rates; as well as a US$7.3 million rider for the retirement of a power plant.
The City Council emphasized that the sum of both elements represents the real impact that ratepayers would face. The retirement clause seeks to recover costs associated with the decommissioning of aging plants that are no longer operational.
The City of El Paso reported that it will participate in Public Utility Commission of Texas (PUCT) proceedings to ensure that any approved increase is equitable and justified. Under EPE’s proposal, the average residential customer would experience a monthly increase of US$22.39, representing a 23% increase in their bill.
Due to the significant economic impact, the City Council voted to intervene and suspend the increase for 90 days. This suspension will provide time to review the request and evaluate its reasonableness while protecting the economic stability of residents.
“The City is taking immediate steps to protect taxpayers and avoid unnecessary costs through a thorough review of this case,” said City Attorney Karla Nieman. “Our proactive approach, combined with expert opinion, seeks to minimize the financial impact on residents and ensure the best outcomes for all El Pasoans.”
El Paso has a strong track record of defending its residents in utility rate cases. In the last six rate cases since 1994, City-led negotiations have generated savings of approximately US$189 million for ratepayers.
To ensure a thorough review, the City has retained consultants and technical experts in regulatory accounting, rate design and cost analysis. More than 5,400 pages of testimony submitted by EPE will be analyzed to ensure that the costs passed on to consumers are reasonable.
The evaluation process will include a review of the impact on different customer classes to ensure a fair allocation of costs; as well as an analysis of the proposed rate of return tied to EPE’s capital structure.
