El Paso Electric to Propose Rate Hikes in Two States, Plus Net Metering Charges

El Paso Electric will seek rate increases in Texas and New Mexico for the second time in three years, and will once again seek to increase charges for customers with rooftop solar panels, the company announced on January 4, according to a report in the Las Cruces Sun-News.

The company has not yet provided details of its proposed rate cases, which require approval from regulators in Texas and New Mexico.

The utility said it anticipates filing a rate case by the end of March with the Public Utility Commission of Texas, and this spring with the New Mexico Public Regulation Commission.

The details of each filing are still in development and the proposed impacts and proposals will be available once the rate increase proposal[s] … [are] filed publicly,” the company said on its website, noting, “These proposals to increase rates are necessary to recover investments EPE has made to replace old equipment and build new generation like the Montana Power Station units 3 and 4 that became operational earlier this year.

“Our new generation replaces equipment as old as 57 years with generation that is 35 percent more efficient,” EPE claimed, noting, “[We]… must continue making these investments to continue supporting the economic and population growth the region continues to experience. “

Indeed, El Paso Electric officials said the rate increases are needed specifically to recover $1.4 billion the utility has invested since 2009 for new infrastructure, generating equipment and other assets. In the next five years, EPE plans to invest an additional $1 billion in new generation, transmission and distribution projects.

In addition to recovering costs for investments, the costs of serving residential customers with private solar panels on their homes will be addressed again in these rate case filings, the utility said.

The El Paso City Council can accept or reject the rate case, or negotiate a settlement. If the city and utility don’t reach anagreement, the rate case would go to the Public Utility Commission.

City Council Representative Cortney Niland (District 8), who has been the City Council leader on two previous rate cases, told the Sun-News that El Paso Electric officials already had mentioned they would likely need to raise the rates in 2017. Therefore, she was not surprised the utility plans to file rate cases in Texas and New Mexico.

“When they are ready to file we will do our due diligence,” Niland said.

In New Mexico, the Public Regulatory Commission has the final decision on any new rates, the local news outlet reported.

El Paso Electric had sometimes contentious rate cases in both New Mexico and Texas that began in 2015 and ended in 2016.

Texas State Sen. José Rodríguez (D-El Paso) told the Sun-News that he remains concerned about the solar surcharge because it will deter residents from seeking to use the alternative energy source. He said it will also deter solar industry development in El Paso.

“I hope that in the next rate setting case we can work these issues out which will benefit EPE, but not negatively impact the solar industry and solar residential users,” Rodriguez said

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