Title
Consider approving Resolution No. 2025-119 regarding the suspension of Oncor Electric Delivery Company LLC’s application for approval of a Distribution Cost Recovery Factor to increase distribution rates within the City of Farmers Branch; and take appropriate action.
Body
BACKGROUND:
Oncor Electric Delivery Company ("Oncor" or "the Company") filed an application on or about June 26, 2025, with cities retaining original jurisdiction, seeking to increase system-wide transmission and distribution rates by about $834 million or approximately 13% over present revenues. The company requests that the City approve a 12.3% increase in residential rates and a 51.0% increase in street lighting rates. If approved, an average residential customer would see a bill increase of about $7.90 per month.
The resolution suspends July 31, 2025, effective date of the Company's rate increase for the maximum period permitted by law to allow the City, working in conjunction with the Steering Committee of Cities served by Oncor, to evaluate the filing, determine whether the filing complies with law, and if lawful, to determine what further strategy, including settlement, to pursue.
The law provides that a rate request made by an electric utility cannot become effective until at least 35 days following the filing of the application to change rates. The law permits the City to suspend the rate change for 90 days after the date the rate change would otherwise be effective. If the City fails to take some action regarding the filing before the effective date, Oncor's rate request is deemed administratively approved.
DISCUSSION:
The City of Farmers Branch is a member of a 170-city coalition known as the Steering Committee of Cities Served by Oncor ("Steering Committee"). The Steering Committee has been in existence since the late 1980s. It took on a formal structure in the early 1990s when cities served by the former TXU gave up their statutory right to rate case expense reimbursement in exchange for higher franchise fee payments. Empowered by city resolutions and funded by per capita assessments, the Steering Committee has been the primary public interest advocate before the Public Utility Commission, the Courts, and the Legislature on electric utility regulation matters for the last 30 years.
Although Oncor has increased rates many times over the past few years, this is the first comprehensive base rate case for the Company since May 2022.
FISCAL IMPACT:
No financial impact.
DISTRICT:
Citywide
POSSIBLE COUNCIL ACTION:
1. I move to approve Resolution No. 2025-119 as presented.
2. I move to approve Resolution No. 2025-119 with modifications.
3. I move to table the issue for further study or take no action.
ATTACHMENT(S):
1. Resolution No. 2025-119
2. Oncor 2025 RC Suspension Resolution Model Staff Report