Your electric bill could rise from Oncor proposal that takes advantage of little-known law

AUSTIN — Dallas-Fort Worth residents could see a bump to their electric bills coming soon under a request from the company that owns power lines for vast swaths of North Texas and beyond.

Oncor Electric Delivery is seeking roughly $53.5 million from electricity providers in costs that likely will be passed on to electric bills. It is the second time the power line company has asked for a rate increase in a matter of months.

If all costs are passed through to consumers, the average North Texas resident would see a 76-cent increase to their monthly electric bill, according to filings at the Public Utility Commission and usage numbers compiled by the U.S. Energy Information Administration.

The Public Utility Commission of Texas approved Oncor’s latest request Thursday. Oncor spokesperson Kerri Dunn said cities served by Oncor and the company agreed on the rate, and that any increase would take effect on Dec. 28, pending regulatory approval.

“Even with this slight increase, Oncor’s rates remain among the lowest among all transmission and distribution utilities in Texas,” Dunn said in an emailed statement.

New law

Until recently, companies such as Oncor were only allowed to seek a rate increase once a year. However, a law passed this year at the Legislature now allows electric distribution companies such as Oncor in North Texas and CenterPoint in the Houston area to seek two rate increases per year.

The Public Utility Commission, which regulates Texas’ power utilities and ERCOT, approved Oncor’s first request earlier this month. The request was made in May. That rate increase approved at the beginning of November could increase residential bills by about $2.07 a month. That will bring in $152.5 million for the company.

Weatherford Republican Sen. Phil King, the bill’s author, said in April at the Capitol that the bill would streamline litigation in rate increase cases that would save power distribution companies money, “which will translate into lower rates paid by your customers.”

Under the law, the Public Utility Commission is given less time — 60 days — to evaluate rate increases. That expedited timeline is raising concerns.

Attorney Alfred R. Herrera represents a coalition of cities served by Oncor. He is involved in negotiations at the PUC over the company’s proposed rate increase. Herrera said the legislation does not allow much time for regulators to review the expenses companies such as Oncor cite for their need to increase electric bills.

“That is the problem with this case — with any future case that will be filed under the legislation,” Herrera said. “We’re going to have the same concerns in that the commission has been given very, very little opportunity to do its work.”

AEP subsidiary Southwestern Electric Power Company also has filed a request for a second rate increase this year. That company owns power lines in Texarkana, Longview and a pocket of the Panhandle.

In Texas, the state guarantees a return on investment for companies that build and maintain power lines. Oncor is by far the largest, encompassing the entire Dallas-Fort Worth metropolitan area, Wichita Falls, Waco and large portions of East and West Texas, including Midland.

The company cited state set increases in the rates that Texas reimburses for distribution infrastructure costs as a driver in profit increases for the third quarter of 2023, according to a news release.

Dunn, the Oncor spokesperson, said the request for further reimbursement was for new infrastructure energized in the first half of 2023 to keep pace with increased customer demand.

Any resulting rate increases are charged to retail power providers. Those companies can choose to pass those rates onto customers as part of a bundled rate.

CORRECTION, 11:15 p.m., Nov. 28, 2023: An earlier version of this story gave two dates for the Public Utility Commission’s approval of Oncor’s first request for a rate increase. Oncor made its first rate request in May and it was approved Nov. 2. Oncor made its second request for a rate increase in September. That is expected to be approved Thursday, Nov. 30.