HomeMy WebLinkAboutItem 11 - Oncor Rate MEMO TO: HONORABLE MAYOR & MEMBERS OF THE CITY COUNCIL
2
FROM: BRUNO RUMBELOW, CITY MANAGER\
MEETING DATE: APRIL 18, 2017
SUBJECT: ONCOR RATE INCREASE SUSPENSION
RECOMMENDATION:
City Council to consider a resolution suspending a rate increase filing by Oncor for the
maximum period allowed by law.
BACKGROUND:
Oncor Electric Delivery Company filed an application on or about March 17, 2017 with
cities retaining original jurisdiction seeking to increase system-wide transmission and
distribution rates by $317 million or approximately 7.5% over present revenues. The
Company asks the City to approve an 11.8% increase in residential rates and a 0.5%
increase in street lighting rates. If approved, a residential customer using 1000 kWh per
month would see a bill increase of about $6.68 per month.
This resolution suspends the April 21, 2017 effective date of the Company's rate
increase for the maximum period permitted by law to allow the City, working in
conjunction with the Steering Committee of cities served by Oncor, to evaluate the filing,
determine whether the filing complies with law, and if lawful, to determine what further
strategy, including settlement, to pursue.
The law provides that a rate request made by an electric utility cannot become effective
until at least 35 days following the filing of the application to change rates. The law
permits the City to suspend the rate change for 90 days after the date the rate change
would otherwise be effective. If the City fails to take some action regarding the
filing before the effective date, Oncor's rate request is deemed administratively
approved.
Although Oncor has increased rates many times over the past few years, this is the first
comprehensive base rate case for the company since January, 2011.
City Council Utility Committee recommends approval.
RESOLUTION NO. 2017-039
A RESOLUTION OF THE CITY OF GRAPEVINE
SUSPENDING THE APRIL 21, 2017, EFFECTIVE DATE OF
ONCOR ELECTRIC DELIVERY COMPANY'S REQUESTED
RATE CHANGE TO PERMIT THE CITY TIME TO STUDY
THE REQUEST AND TO ESTABLISH REASONABLE
RATES; APPROVING COOPERATION WITH THE
STEERING COMMITTEE OF CITIES SERVED BY ONCOR
TO HIRE LEGAL AND CONSULTING SERVICES AND TO
NEGOTIATE WITH THE COMPANY AND DIRECT ANY
NECESSARY LITIGATION AND APPEALS; FINDING THAT
THE MEETING AT WHICH THIS RESOLUTION IS PASSED
IS OPEN TO THE PUBLIC AS REQUIRED BY LAW;
REQUIRING NOTICE OF THIS RESOLUTION TO THE
COMPANY AND LEGAL COUNSEL FOR THE STEERING
COMMITTEE
WHEREAS, on or about March 17, 2017, Oncor Electric Delivery Company
(Oncor), pursuant to PURA §§ 33.001 and 36.001 filed with the City of Grapevine a
Statement of Intent to increase electric transmission and distribution rates in all
municipalities exercising original jurisdiction within its service area effective April 21,
2017; and
WHEREAS, the City of Grapevine is a member of the Steering Committee of
Cities Served by Oncor ("Steering Committee") and will cooperate with the 156 similarly
situated city members and other city participants in conducting a review of the
Company's application and to hire and direct legal counsel and consultants and to
prepare a common response and to negotiate with the Company prior to getting
reasonable rates and direct any necessary litigation; and
WHEREAS, PURA § 36.108 grants local regulatory authorities the right to
suspend the effective date of proposed rate changes for ninety (90) days after the date
the rate change would otherwise be effective; and
WHEREAS, PURA § 33.023 provides that costs incurred by Cities in ratemaking
proceedings are to be reimbursed by the regulated utility.
WHEREAS, all constitutional and statutory prerequisites for the approval of this
resolution have been met, including but not limited to the Open Meetings Act; and
WHEREAS, the City Council deems the adoption of this resolution to be in the
best interests of the health, safety, and welfare of the public.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY
OF GRAPEVINE, TEXAS:
Section 1. That all matters stated hereinabove are found to be true and correct
and are incorporated herein as if copied in their entirety.
Section 2. That the April 21, 2017 effective date of the rate request submitted
by Oncor on or about March 17, 2017, be suspended for the maximum period allowed
by law to permit adequate time to review the proposed changes and to establish
reasonable rates.
Section 3. As indicated in the City's resolution approving membership in the
Steering Committee, the Executive Committee of Steering Committee is authorized to
hire and direct legal counsel and consultants, negotiate with the Company, make
recommendations regarding reasonable rates, and to intervene and direct any
necessary administrative proceedings or court litigation associated with an appeal of a
rate ordinance and the rate case filed with the City or Public Utility Commission.
Section 4. That the City's reasonable rate case expenses shall be reimbursed
by Oncor.
Section 5. That it is hereby officially found and determined that the meeting at
which this Resolution is passed is open to the public as required by law and the public
notice of the time, place, and purpose of said meeting was given as required.
Section 6. A copy of this Resolution shall be sent to Oncor, Care of Howard
Fisher, Oncor Electric Delivery Company, LLC, 1616 Woodall Rodgers Freeway, Dallas,
Texas 75202 and to Thomas Brocato, Counsel to the Steering Committee, at Lloyd
Gosselink Rochelle & Townsend, P.C., P.O. Box 1725, Austin, Texas 78767-1725.
Section 7. That this resolution shall become effective from and after the date
of its passage.
PASSED AND APPROVED BY THE CITY COUNCIL OF THE CITY OF
GRAPEVINE, TEXAS on this the 18th day of April, 2017.
APPROVED:
William D. Tate
Mayor
Resolution No. 2017-039 2
ATTEST:
Tara Brooks
City Secretary
APPROVED AS TO FORM:
John F. Boyle, Jr.
City Attorney
Resolution No. 2017-039 3