Beginning this March, CPS Energy customers will see a 3.85% rate increase and a new fee on their monthly electricity bills.
San Antonio City Council on Jan. 13 voted 8-3 to endorse what will be the city-owned utility’s first rate hike in eight years.
CPS Energy officials said the higher rate will support increased resiliency in extreme weather, technology upgrades, and the utility’s efforts to attract and retain employees and keep pace with the San Antonio area’s growth.
The council also voted 9-2 to pass what CPS Energy calls a pass-through fee of $1.26, a new charge designed to help the utility to recoup $418 million in fuel costs resulting from last February’s historic winter storm. The CPS Energy board voted unanimously Jan. 10 to adopt both the rate increase and the new fee.
Some council members and several residents expressed reservations about raising ratepayers’ electrical bill given uncertainties prompted by the COVID-19 pandemic.
Some city officials also called for the utility to be more transparent about its actions and to be more cost-efficient.
Other local elected and business leaders agreed it is a challenging time, but the rate hike and new fee are necessary to help CPS Energy to address current financial needs and future investments.
“We thank the San Antonio City Council for their actions today. We understand this was a difficult vote, and the timing was not ideal, but we appreciate the necessary investment into our community-owned asset,” said Rudy Garza, CPS Energy’s interim president and CEO.
“Through this rate increase, we will do the work needed and invest in our infrastructure, our technology and our people to ensure the delivery of essential services to our community.”
According to CPS Energy, the average residential customer will see $3.84 added to their monthly bill due to the rate hike, aside from the new $1.26 monthly fee in the fuel adjustment portion of the bill.
Mayor Ron Nirenberg said it is not a perfect time to raise utility bills on anyone; the rate hike and new fee are necessary; and the council did not make its decision lightly.
“This request covers the basics and does not add any extras. Through the city’s partnership with CPS, we are ushering in a new era of accountability,” Nirenberg said.
Council Members Manny Pelaez of District 8 and John Courage of District 9 both voted to approve the base rate hike and the pass-through fuel charge.
District 10 Council Member Clayton Perry voted to back the new fee, but he cast a “no” vote on the rate increase alongside Council Members Jalen McKee-Rodriguez of District 2 and Teri Castillo of District 5.
Perry said he would like to see CPS Energy operate more like a business, but that while many businesses are raising prices due to pandemic-induced economic challenges, all ratepayers will be affected by their higher energy bills.
“This isn’t the right time. I’m a pragmatist. I look at everything, but when I’m getting feedback from my community, I’m listening to that as well,” Perry said.
Critics, including representatives of Recall CPS Energy, a coalition of local organizations and residents worried about the utility’s policies and actions, said the rate hike and new fee will have a particularly negative impact on low-income ratepayers. They also repeated calls for CPS Energy to craft a plan for closing the South Side Spruce facility, one of the nation’s few remaining coal-burning power plants.
“In voting to pass this rate increase, City Council has failed the people of San Antonio and especially the most vulnerable populations by not forcing CPS Energy to commit to making our rates more equitable through long overdue reform despite public opposition and increasing distrust of the utility,” Recall CPS Energy said in a statement.