MAYOR ANNISE PARKER ANNOUNCES CITY OF HOUSTON CHALLENGE TO CENTERPOINT ENERGY GAS RATE INCREASE
March 9, 2010 -- Mayor Annise Parker announced today that the City of Houston will be asking the Texas Railroad Commission to reconsider the allocation of a substantial rate increase to Houston residential customers.
On Tuesday, February 23, 2010, the Railroad Comission rejected CenterPoint Energy’s (gas) request for a $20 million plus rate increase and only approved an approximate $5 million increase in gas rates for the Houston area. The increase was originally denied in its entirety by the City of Houston in November 2009, and CenterPoint appealed the City’s decision to the Railroad Commission. Unfortunately, CenterPoint used this rate case to completely restructure how rates are paid by residential and industrial customers in Houston – to the detriment of residential customers. The Commission’s decision allows CenterPoint to significantly decrease gas rates by over $8 million to commercial and industrial customers while residential customers will pay an additional $18 million plus in their rates, significantly increasing the residential customer’s bill.
In a change to long-standing policy, the Railroad Commission also granted CenterPoint’s request to collect street rental fees by CenterPoint from just in-city customers, even though CenterPoint admits all its customers – both inside and outside the city – benefit from the rented rights-of-way for the transmission of gas through its system. The street rentals (franchise fees) charged by municipalities have historically been collected from all customers because all customers benefit from the utility’s access to municipal rights-of-way. The Railroad Commission’s new treatment of street rentals places a still greater portion of the gas rate increase on residential customers located within the city limits.
The City of Houston will be filing a Motion for Rehearing to request the Commission’s reconsideration of its decision on these two issues affecting Houston’s residential ratepayers.