Cities aim to block AEP hike

Move sends company’s request to PUC

HARLINGEN — The fight goes on to keep the region’s electric rates from jumping.

Last week, the cities of Harlingen and San Benito joined other Rio Grande Valley cities in denying AEP Texas’ proposed rate increase.

Now, the cities’ decision sends the case to Texas’ Public Utility Commission, which is expected to hand down a ruling late next month or in early October, Gabriel Gonzalez, a Harlingen assistant city manager, said.

AEP is requesting an increase of about $4.75 a month for residential customers using 1,000 kilowatt hours of electricity in AEP’s central division.

“It’s pretty significant when you think of what the homeowners might see,” Gonzalez said.

In May, Harlingen, San Benito and a group of Valley cities hired Lloyd Gosselink Attorneys to try to negotiate a lower rate hike.

“I imagine every city in the Valley that they represent is going to deny it as well,” Gonzalez said.

Unlike previous talks that curbed AEP’s proposed hikes in past years, this time negotiations apparently failed to lower AEP’s proposed increase.

“In the past, we’ve been able to come to some sort of agreement,” Gonzalez said.

Overall, AEP is seeking a $38.3 million increase in its base rate revenues.

The company’s proposed rate hike “reflects the amounts that are charged to the retail electric providers for the delivery of electricity over AEP Texas’ transmission and distribution lines,” the company stated in a press release.

At AEP, spokesman Larry Jones said he welcomed the cities’ denial of the company’s proposed rate hike, which sends the case to the PUC.

“This is part of the process,” Jones said. “Our goal is to have consistent rates throughout the service territory.”

AEP might be pushing for a rate increase in its central service area.

But in the state’s northern regions, the company is proposing decreasing its rates by $5.01.

In the central service area, the proposed rate increase would help offset mounting service costs, Judith E. Talavera, AEP Texas president and chief operating officer, stated in a press release.

“The continued growth in Texas, as well as the need to upgrade and maintain the existing transmission and distribution infrastructure, has resulted in AEP Texas’ investment of nearly $6 billion in its T&D system since the last rate case,” she stated, referring to the company’s last base rate case in 2006.

In Harlingen, Gonzalez believes AEP is proposing a rate increase in South Texas because the company runs only two transmission lines into the Valley.