CPS Energy officials Nov. 8 said community members may address a proposed 4.25% base rate increase, which is already being scrutinized by trustees for the city of San Antonio-owned utility.
The background
CPS Energy board, in a Nov. 8 meeting, got its first full look at the proposed rate hike, which utility staff said is needed to help upgrade aging infrastructure, cybersecurity and safety systems, and keep pace with continued population growth in the organization’s service area.
CPS Energy executives also said 30% of staff members will retire over the next five years and that another 30% of current staffers have been at their jobs less than two years, so more revenue is required to hire and retain skilled workers.
According to CPS Energy administrators, an approved 4.25% rate hike would go into effect Feb. 1 and add an estimated $4.45 to the average residential monthly bill of $181.10. However, customers on the utility’s Affordability Discount Program would see half of the hike. A rate hike will also be applied to commercial users’ bills.
Both the CPS Energy board and City Council must approve the potential rate increase in December, officials with the utility said. Such a rate hike would generate about $85 million yearly.
What they’re saying
CPS Energy trustees and city leaders said they understand the utility needs improvements and an adequately sized workforce to properly serve a growing service area.
However, some trustees and council members voiced concern that a rate hike could burden residents, especially those struggling to make ends meet given inflation, rising monthly expenses and other economic worries.
“Nobody likes a rate increase. We’ve got to have really good justifications because our customers are also our owners,” Mayor Ron Nirenberg told CPS Energy executives.
Cory Kuchinsky, chief financial officer, said CPS Energy initially projected a new base rate increase of 5.50% but that the utility’s overall performance in 2023 allowed them the luxury to lower the rate hike proposal.
“Ongoing rate support will be necessary to meet customers’ needs that we’ve talked about in the community over the last couple of years,” Kuchinsky said.
Other trustees and council members said many CPS Energy customers are struggling to catch up on overdue payments. More than 201,000 residential and commercial users have past due bills totaling $179 million, according to CPS Energy data.
“That’s up from the previous month by 11,000 customers and by $4 million. How is management going to persuade the City Council to add that monetary burden?” CPS Energy trustee John Steen said at the meeting.
Get involved
Community members have a chance to provide input on the rate hike proposal in a virtual town hall scheduled 7-8 p.m. Nov. 30. CPS Energy customers may also remark on the proposal before the CPS Energy board and City Council formally consider the rate hike.
