HOUSTON – If you live in an area serviced by CenterPoint Energy or Texas-New Mexico Power, get ready to see a higher electric bill this month.
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Both companies have raised their rates starting September 1st. Some of you wrote us because you received a notification from your electric provider about the increase. KPRC 2′s Amy Davis explains what this will mean for your electric bill.
Why the increase in electric rates?
Every year on September 1st, transmission and distribution utilities like CenterPoint and Texas-New Mexico Power increase their rates. They do this as we head into the fall and winter months, when people typically use less electricity. The companies say they need a steady flow of revenue to maintain their equipment, even when demand is lower.
ASK AMY: How long will Texas electric rates be this high?
In March, rates usually drop again for the summer months when electricity usage spikes. In the past, these increases and decreases would balance out by the end of the year. But that’s not happening anymore.
How much more will you pay?
- CenterPoint Customers: Your rate is now 5.35 cents per kilowatt-hour, up from 3.87 cents. For 3,000 kilowatts, this means an extra $44 on your bill.
- Texas-New Mexico Power Customers: Your rate is now 6.29 cents per kilowatt-hour, up from 5.29 cents. This 1-cent increase will add about $30 to your bill for 3,000 kilowatts.
Even when rates drop in the spring, they haven’t been lowering to previous levels. Last fall’s rates were higher than the year before, and this pattern is causing a gradual, steady increase in what you pay overtime.
Why do TDSP rates change?
Each of the regulated utility companies is entitled to collect 100% of their costs from their ratepayers. And they are guaranteed to receive a rate of return. That’s because they provide a critical public service: delivering electricity, maintaining the infrastructure, and responding in case of an emergency.
The Public Utility Commission of Texas reviews and approves each utility’s rate case.
Important Note: This increase is not related to the extra $60 million that CenterPoint has requested or any recovery funds for Hurricane Beryl. Those rate increases are still pending, and CenterPoint is currently appealing a judge’s order to review its rates, which many say are already too high.
