The new rate plan still includes the $22 monthly fixed charges. They include 200 kWh of electricity with the fee, but it is hardly enough to blunt the impact of the high fees. The plan delays part of the rate increase for two years, but it still contains the flawed cost of service model that penalizes residential and small business ratepayers. And it still contains every penny of the excessive revenue requirement that Austin Energy proposed in the original rate filing.
New Subsidy Proposed for Out-of-City Ratepayers
The worst part of the new plan is a 6.1% discount for out-of-City ratepayers. We are being asked to subsidize developments outside the city limits, which would lead to a further erosion of Austin's tax base and make Austin more unaffordable than it already is! No other municipal utility in Texas offers such a discount. This would lead to future annexation difficulties and additional rate increases to pay for the subsidy as outlying areas continue to grow. Austin Energy already signed a 10 year agreement to pay a 3% franchise fee to several communities outside the city. This new subsidy is easily one of the worst policy ideas ever to come from the City or Austin Energy!
Here is our complete Electric Rate Action Plan:
Electric Rate Change Action Plan
By Groups Listed on “Affordable Energy for Austin” Blog
For Consideration by the Austin City Council
Set priorities for a revised proposal to :
Reduce the new revenue requirement by 50 to 80%.
Meet community expectations for the Customer Assistance, Energy Efficiency and Solar Programs.
Maintain a rate design that rewards energy conservation.
Allocate costs using a method that results in industrial customers paying their fair share of the costs.
Eliminate the $10.00 delivery charge. Leave the cost in the per kWh energy charge as it is collected today.
Leave the customer charge at $6.00 or a similar amount.
Include all costs in the system wide rates instead of creating new pass through surcharges.
Maintain system wide rates that are the same for customers inside and outside of the city limits.
Review and assess Austin Energy’s fuel charge calculation procedures for appropriateness.
Direct the city auditor to hire independent consultants, including an advocate for residential and low-income customers, to review the current proposal and make recommendations on revenue requirements, cost of service and rate design.
Delay the change in rates to be charged until 2015 when the special contracts with the industrial ratepayers expire. During the interim period, implement whatever cost-saving measures are necessary to maintain rates at or very close to the current levels and take the following steps.
Require Austin Energy to submit a plan to resolve all of the operating inefficiencies identified in the Navigant Report.
Public Citizen Texas Office
Texas ROSE (Ratepayers’ Organization to Save Energy)
Austin Tenants Council
Gray Panthers of Texas
Texas Legal Services Center
Bill Oakey, Consumer Advocate
Paul Robbins, Energy Activist