HARLINGEN — Harlingen is joining other area cities to fight a proposed electric rate increase.
Under the proposal by AEP Texas, the amounts charged to providers for a residential customer using 1,000 kilowatt hours of electricity a month would increase around $4.75 a month.
The rate request reflects the amounts that are charged to central and south Texas providers for the delivery of electricity over AEP Texas’ transmission and distribution lines.
The AEP Texas rates are included as part of the electric bill a customer receives from their electric provider.
However, the power company is also proposing decreasing its rates by $5.01 across the state’s northern regions.
Last night, city commissioners agreed to hire Lloyd Gosselink Attorneys to try to reduce the proposed increase.
Commissioners approved a resolution to hold off the proposed June rate increase to allow negotiations to begin, Assistant City Manager Gabriel Gonzalez said.
“AEP intends to increase their system-wide distribution rate by $38.3 million per year, an increase of 4.2 percent for customers in the central division and a decrease of system-wide transmission rates in the north division by $3.16 million, a decrease of 0.7 percent,” Gonzalez wrote in an executive summary.
The city is joining McAllen and other Valley cities to try to curb the proposed increase, Gonzalez told commissioners.
“It’s a coalition of cities that petitioned together to get a reduction,” he said before his presentation.
After the meeting, AEP spokesman Danny Lucio said the company is proposing a rate increase “to reflect the current costs to service each customer class.”
“It will also offer an opportunity to recover costs and to update tariffs,” Lucio said in an interview.
Lucio said it’s been 12 years since AEP has gone before the Public Utilities Commission for a rate increase.
But he did not have information readily available on the last AEP rate hike.
It’s not the first time city officials have fought to lower AEP’s rate increases.
“As we’ve done in the past, we are planning to participate in the case and will intervene on behalf of the cities of McAllen, Victoria and the 42 cities in the Lower Rio Grande Valley Development Council,” attorney Thomas Brocato wrote to area cities. “As a ratemaking proceeding, cities are entitled to reimbursement of their legal and consulting expenses. Thus, there will be no direct charge to your city as a participant in the rate case.”
The city’s previous rate battles have helped curb AEP rate increases, Gonzalez said.
“They’ve always been successful in getting us a decrease,” he said of negotiations with AEP.
AEP is proposing a rate increase because of the cost of transmitting electricity to the region, Gonzalez said.
“It’s a transmission issue,” he said before his presentation.
Lucio denied the cost of electrical transmission was behind the proposed rate hike.
But Gonzalez said the cost of transmitting electricity to the Valley is higher because most electricity is generated north of the region.
“The people who generate electricity are not in the Valley,” he said. “That’s the issue — getting the electricity from where it’s made down to us.”