SAN ANTONIO (KTSA News) — CPS Energy has been open about the fact the utility company has plans to increase rates for the first time since 2014 following the historic winter storm in February.
The San Antonio Express-News reported this week that CPS Energy is planning to ask the City Council next month to approve the increase and the figure lower than anticipated.
The rate hike to be requested is reportedly 3.85%, which would amount to an added $5 per monthly bill for customers. That would total about $73 million dollars per year in additional revenue for CPS Energy.
Express News reports that $31 million from that added annual revenue will be earmarked for weatherization of the CPS Energy power plants. $2 million has already been spent this year preparing the plants for any possibility of severe winter weather that includes temporary enclosures around exposed areas of the power plants and adding more insulation to pipes.
“There are things that the regulators are going to require of us going forward that we’re planning for,” Garza said to the Express News. “That $31 million is to make sure we can be compliant.”
$30 would go towards establishing electric and gas service to newly build residential and commercial developments and a new technology platform. The remaining $13 million would be used to hire 250 employees to add to the already existing CPS Energy workforce totaling almost 3,000.
The rate increase to be proposed is a departure from the 10% increase initially discussed by CPS officials in September. The company dropped that figure to 8% on October 25.
Unrelated to the rate increase, the company was hit with more than $1 billion in storm-related bills and fees over the course of the week of Feb. 14.
CPS Energy has reportedly paid $418 million from that staggering total for power and natural gas bought during the storm, and is in the process of contesting the remaining $580 million in court.
Officials said that $418 million will be paid off by ratepayers of the course of 25 years at an average increase of $1.26 per customer, with the increase possibly being added to bill as early as March. That amount could possibly increase, pending the outcome of various lawsuits against gas suppliers, or decrease if all parties settle on smaller amounts.