To: Mayor and City Council
From: Aaron Rector, City Manager
Subject:
Title
Consider a resolution of the City of Keller, Texas finding that Oncor Electric Delivery Company LLC’s application to change rates within the City should be denied; finding that the City’s reasonable rate case expenses shall be reimbursed by the company; 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.
Action Requested:
Adopt a Resolution denying Oncor Electric Delivery Company LLC’s application to increase system-wide transmission and distribution rates.
Background:
On June 26, 2025, Oncor Electric Delivery Company LLC (“Oncor” or “Company”) filed an application with cities retaining original jurisdiction seeking to increase rates by approximately $834 million, or about 13% over present revenues. Specifically, Oncor requested a 12.3% increase in residential rates and a 51.0% increase in street lighting rates. If approved, the average residential customer would see an increase of about $7.90 per month.
The City previously suspended Oncor’s rate request for the maximum 90 days allowed under state law. During this suspension, the City participated with the Steering Committee of Cities Served by Oncor (“Steering Committee”) to review the filing. Based on the recommendations of consultants retained by the Steering Committee, the proposed increase was determined to be excessive and unreasonable.
The Steering Committee recommends denial of the requested rate change. If the City adopts the Resolution, Oncor may appeal the decision to the Public Utility Commission of Texas (PUC), where it will be consolidated with Oncor’s pending case (PUC Docket No. 58306). All cities with original jurisdiction must take final action to deny the requested increase by October 29, 2025.
Financial Impact:
Oncor is required to reimburse cities for all reasonable rate case expenses incurred in this matter. Legal counsel and consultants approved by the Steering Committee will submit invoices to Oncor for reimbursement.
Citizen Input/Board Review:
The City’s participation in the Steering Committee process ensures that the interests of residential and commercial customers are represented collectively. The resolution has been coordinated through this process, and the Steering Committee recommends denial.
Legal Review:
The Resolution has been reviewed and approved as to form by the City Attorney
Alternatives:
City Council has the following alternatives:
- Approve as submitted
- Approve with changes
- Denial
Council Action:
Consider adoption of a Resolution finding Oncor’s proposed rates unreasonable and denying the requested rate increase. The Resolution also provides that Oncor shall continue charging its existing rates and reimburse the City’s reasonable rate case expenses.