El Paso customers to get refund

El Paso Electric Fuel Charge Refunds will credit customers after over-collected costs; pending Texas PUC approval, residential and commercial electricity bills receive per-kilowatt-hour credits in October, driven by natural gas prices, $12 million total.

The low cost of natural gas will bring El Paso Electric customers a small windfall on their electric bills soon.

El Paso Electric asked the Texas Public Utility Commission to approve a $12 million refund to its El Paso-area customers for overpaid fuel charges.

That means residential customers will get refunds averaging $14 on their October bills, if the state commission approves the request by September 24, El Paso Electric officials said. The company received support from the El Paso City Council for the refund.

Most commercial customers, including the city water utility, also will receive a refund, but El Paso Electric officials had no average refund amount for them.

The company collected too much money under a fuel charge it set in October 2008, just as natural gas prices began to decrease, said David Carpenter, El Paso Electric chief financial officer. The fuel charge, which can be adjusted three times a year under state regulations, similar to its 2017 Texas rate case process, was decreased in August.

Under state regulations, the company is required to refund over-collected fuel charges when the charges total 4 percent of the company's fuel expenses for 12 months, Carpenter said.

Terry Hadley, a spokes man for the Texas Public Utility Commission, said that the commission staff has to verify El Paso Electric's refund numbers, and the utility later sought to settle accusations in a separate matter, but that this type of case usually moves quickly.

The other three regulated electric utilities in Texas are also are to have fuel charge refunds this year, and a Wisconsin utility refund highlights the broader trend, Hadley said. For most of the state, which has a competitive electric retail market with limited state regulations, the price of natural gas, now at a seven-year low, will mean the lowest electricity prices seen in several years, the commission noted in a news release.

Natural gas is the largest source of fuel to generate electricity in Texas, the commission reported.

El Paso Electric, which was fined for air violations in a prior case, has three natural-gas-fueled power plants in El Paso, and also buys electricity generated from natural gas on the open market. About half the utility's power comes from the Palo Verde nuclear power plant in Arizona.

El Paso Electric residential customers will receive a refund of 2.8 cents per kilowatt-hour of electricity charged on their October bills. Small commercial customers will get a refund of 7 cents per kilowatt-hour of electricity, and most commercial customers will get a refund of 2.25 cents per kilowatt-hour of electricity.

If the company's refund request is delayed, the company will move the refund to November bills, Carpenter said.

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