El Paso Electric announces City of El Paso approved settlement terms
El Paso Electric announced that the City of El Paso approved, in principle, the settlement terms for EPE's rate case pending in Docket No. 46831 before the Public Utility Commission of Texas, or PUCT. No party in the case has indicated that it intends to oppose the proposed settlement. Key terms of the proposed settlement include: an annual non-fuel base rate increase of $14.5M; a return on equity of 9.65%; a determination that all new plant in service was prudent and used and useful and therefore is included in rate base; and allowing EPE to recover reasonable rate case expenses, subject to Commission Staff's review and currently estimated to be approximately $3.0M, through a separate surcharge over a three year period. The settlement also establishes baseline revenue requirements for transmission and distribution investment costs. The settlement also includes a minimum monthly charge of $30.00 for residential customers with distributed generation. This charge is to recover the cost of grid and customer-related services. Additionally, the proposed settlement allows for the annual recovery of $2.1M of nuclear decommissioning funding and establishes annual depreciation expense that is approximately $1.9M lower than the annual amount requested by EPE in its initial filing. The settlement documents will be filed with the Administrative Law Judges, along with a request that they return the case to the PUCT for approval. A Final Order is anticipated to be issued in the Q4. Regardless of when the Final Order is issued, the new rates will relate back to consumption on or after July 18.