City Council approves CPS Energy rate hike; increase to take effect in February

City council vote was final hurdle for a 4.25% increase to gas, electric base rates

SAN ANTONIO – San Antonians’ power and gas bills will be going up next year.

The San Antonio City Council voted 8-3 on Thursday morning for the second increase in two years of CPS Energy’s gas and electric rates. This latest rate hike is expected to cost the average residential customer an additional $4.45 per month after it takes effect in February 2024.

“This is a relatively small rate increase, but at the end of the day, San Antonians will still enjoy one of the lowest rates in the country,” Mayor Ron Nirenberg said.

Councilman Jalen McKee-Rodriguez (D2), Councilwoman Teri Castillo (D5), and Councilman Marc Whyte (D10) voted against the rate increase.

The San Antonio City Council approved a 4.25% increase to CPS Energy's base gas and electric rates 8-3. It takes effect Feb. 1, 2024. (KSAT)

Their opposition followed a failed attempt led by Whyte to cut the rate request in half and fund the difference through the city’s budget process. Councilwoman Phyllis Viagran (D3) and Councilwoman Melissa Cabello Havrda (D6) joined the trio on that proposal, which was voted down 5-6.

“We’ve all said that we’re here to do this together. It’s not doing it together to ask the citizens to pay for the entire damn thing,” Whyte argued before the vote.

Council’s approval was the final step for the rate increase after the CPS Energy Board of Trustees unanimously passed it on Monday.

The rate hike will bring in an additional $85 million for CPS Energy every year. The utility’s plans for the money include replacing aging technology, more tree trimming, keeping up with the system’s growth, planning for a wave of pending retirements, and working toward converting a coal plant to natural gas.

“You know, CPS has made a convincing case,” Cabello Havrda said. “I don’t think this is a matter of if, it’s a matter of how.”

The San Antonio City Council voted down an effort led by Councilman Marc Whyte (D10) to cut the requested rate hike in half. Whyte proposed funding the difference through the city budget process. (KSAT)

SERIES OF RATE HIKES

The utility in 2021 had been considering a double-digit rate increase after rates stayed level since February 2014.

Instead, CPS Energy began a strategy of pursuing a series of smaller rate increases. A 3.85% bump in the base rates and an increase to the fuel adjustment charge in March 2022 was the first step. This increase is the second.

CPS Energy is already planning on another increase in 2026, which it currently estimates will be 5.5%.

It’s not yet clear if a fourth rate request will follow in the same two-year pattern.

A slide from a Dec. 4 CPS Energy Board of Trustees meeting shows the estimated impact of the rate hike on customer bills. (CPS Energy)

‘NOT A VERY GOOD PRESENT’

Three business groups voiced their approval of the current increase: the North San Antonio Chamber of Commerce, the San Antonio Hispanic Chamber of Commerce, and the Greater San Antonio Chamber of Commerce.

However, with many customers already facing rising prices in everything from groceries to car insurance, the increase is unlikely to be welcomed by many others.

“This is not a very good present,” Betty Eckert told council members during the public comment session.

Roughly one of every six CPS Energy customers is already behind on their account. Most of them are residential customers, rather than businesses.

“We cannot be so far removed and out of touch as to scoff at $5 when residents will stand in line for five hours to receive a $20 turkey voucher or a $15 box fan, or cry tears of joy receiving a $5 gift for their children,” McKee-Rodriguez said.

Representatives of the Alamo Sierra Club and MOVE Texas urged the city to insist on restructured rates and to hire a consumer advocate who could represent community interests during rate reviews. McKee-Rodriguez and Castillo also supported those ideas during Thursday’s discussion.

However, CPS Energy officials say that switching to a tiered rate structure would have to wait until after it updates its technology. Since CPS Energy President & CEO Rudy Garza said the utility is less than a year into a five-year plan to do that, though, the expected 2026 rate request is not likely to include any restructuring either.

AFFORDABILITY PROGRAM

The rate increase also involves a plan to widen eligibility for the utility’s Affordable Discount Program (ADP) to include people whose utility bills take up a significant portion of their paychecks. The utility says that will add another 15,000 customers to the approximately 140,000 who are already eligible for the program.

However, the utility said 65,000 customers are actually enrolled in the program, which provides a combined $16.14 discount to participating customers. That discount will also be increased to $18.36 to cover half of the expected increase to residential customers’ bills under the rate hike.

Councilwoman Marina Alderete Gavito (D7) thinks the utility could open up the program’s eligibility even further by lowering the income threshold to take part.

Garza said the utility plans to look further into eligibility requirements for ADP and a second program, Residential Energy Assistance Program (REAP), to make sure they get the most people.


About the Authors:

Garrett Brnger is a reporter with KSAT 12.

Adam Barraza is a photojournalist at KSAT 12 and an El Paso native. He interned at KVIA, the local ABC affiliate, while still in high school. He then moved to San Antonio and, after earning a degree from San Antonio College and the University of the Incarnate Word, started working in news. He’s also a diehard Dodgers fan and an avid sneakerhead.