SAN ANTONIO – As CPS Energy pushes for council approval of a new rate hike, the utility’s interim CEO doesn’t expect to win over many of its customers.
On Dec. 10, the utility sent out more than 2.2 million messages to customers -- through emails, texts, and calls -- alerting them about the proposal, which would bump up the average homeowner’s monthly bill by a little over $5. It had a telephone town hall on Tuesday and has scheduled town halls in nearly every city council district, right up to the night before council’s Jan. 13 vote on the increase.
However, interim CEO Rudy Garza says the public outreach is more about explaining the utility’s reasoning than convincing anyone.
“I’m not anticipating changing anybody’s mind about, you know, their opinion of a rate increase. Nobody likes tax increase. Nobody likes a rate increase. But it’s necessary to provide service. And, you know, when we educate folks on that, you know, they understand that,” Garza told KSAT after a Wednesday city council meeting about the proposed increase.
The proposal consists of a 3.85% increase to the base rates and higher fuel charge. Combined, they would increase an average homeowner’s bill by 3.3%.
READ MORE: 5 things to know about the CPS Energy rate hike
City staff and utility officials say the rate hike would cover immediate financial needs for the utility: making infrastructure more resilient, hiring staff, updating technology, keeping up with the growth of its customer base, and paying off fuel costs from the February freeze.
Garza told council members the utility is already financially stressed, and voting down or delaying the rate increase could risk the utility’s credit rating.
“We’re your asset,” Garza told the council. “And, you know, this council has to decide whether or not you’re going to invest in us, or not, to allow us to do our job. And you know, we’ve been talking about a rate increase, quite frankly, for, you know, a better part of three years internally. We’ve been stressed significantly for the last couple of years, but the pandemic has pushed this off. So, you know, our request is timely, and it’s necessary.”
But CPS Energy’s request also comes at a time when trust and approval of the utility has plummeted, largely brought on by the extended power outages many people faced in the February freeze.
District 10 Councilman Clayton Perry says his office has gotten “a lot of feedback,” and none of the people calling are saying they understand the need for a rate increase.
“They’re all saying not only ‘no,’ but ‘hell no,’” Perry said during a Wednesday council meeting. “Because of reliability issues, what they read in the newspapers -- on, and on, and on -- 100 different reasons why.”
District 2 Councilman Jalen McKee-Rodriguez also had reservations.
“I’m being made to feel right now, or, you know, the general consensus is that we have to vote ‘yes,’ or else,” McKee-Rodriguez said during Wednesday’s meeting. “That’s essentially what this is, and I’m -- and what I’m conveying, and what I was conveying in my first bid is that my community does not want me to fall in line. They are very angry, very upset, and there are a lot of concessions that need to be made. There is conversations that need to be had, and they’re very distrustful.”
District 9 Councilman John Courage, though, said he will be supporting the rate hike.
“I think people in my community will support it when they understand we’re going to improve the system, keep it reliable and keep it providing energy that we expect at $5 a month more for the average consumer,” Courage said.
ADDITIONAL INFORMATION
CPS Energy has created a web page devoted to laying out its case for a rate increase, including a bill estimator. You can find their upcoming town hall events HERE.