To: Aaron Rector, City Manager
From: Lupe Orozco, Administrative Services Manager
Subject:
Title
Consider a resolution of the City of Keller suspending the July 31, 2025, effective date of Oncor electric delivery company’s requested rate change to permit the city time to study the request and to establish reasonable rates; approving cooperation with the Steering Committee of Cities Served by Oncor to hire legal and consulting services and to negotiate with the company and direct any necessary litigation and appeals; finding that the meeting at which this resolution is passed is open to the public as required by law; requiring notice of this resolution to the company and legal counsel for the steering committee.
Action Requested:
City Council consideration of a resolution suspending the July 31, 2025, effective date of Oncor electric delivery company’s requested rate change to permit the City time to study the request and to establish reasonable rates; approving cooperation with the Steering Committee of Cities Served by Oncor.
Background:
The City of Keller, along with approximately 170 other cities, is a member of a coalition known as the Steering Committee of Cities Served by Oncor (“Steering Committee”). On or about June 26, 2025, Oncor Electric Delivery Company (Oncor), pursuant to PURA §§ 33.001 and 36.001 filed with the City of Keller a Statement of Intent to increase electric transmission and distribution rates in all municipalities exercising original jurisdiction within its service area effective July 31, 2025.
The resolution suspends the 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.
Financial Impact:
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 asks the City to 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
Legal Review:
The proposed resolution has been reviewed and submitted by the Oncor Cities Steering Committee (OCSC) general counsel at Lloyd Gosselink Rochell & Townsend.
Alternatives:
City Council has the following alternatives:
- Approve as submitted
- Approve with changes
- Denial