Loading...
06-10-1994 (City Council) Agenda Packet City of Wylie AGENDA COMMUNICATION ice• Legal Steven P. Deiter SUBMITTED BY: DIRECTOR: DATE REFERENCE NO. SUBJECT 6-10-94 Approval of TU Electric Tariff Amendments SUMMARY OF SUBJECT: TU Electric is seeking the City's approval to institute new tariffs for certain business customers within the City. The new tariffs are designed to allow TU to offer discounted electric rates to certain business customers to induce to customer to locate or stay in a TU served area. Such incentives, if approved, would be another tool for the City to use in attraction new business and retention of existing business. TU assures the City the reduced rates of the new tariffs will not be subsidized by residential or other customers. TU is requesting the Council to take action on the request by passing an ordinance which either grants or denies the request. In the event of denial the request will be appealed to the PUC for further consideration. ALTERNATIVES: (1) Approve request for amendment to tariffs by adoption of ordinance of approval (2) Deny request for amendment to tariffs by adoption of ordinance of denial (3) Take no action on request, which inaction will be counted as denial ACTION REQUESTED: Staff recommendation is for Council to adopt ordinance approving tariff amendment. MEMORANDUM TO : City Council FROM : Steve Defter • ; SUBJECT : TU Electric ' equest For Tariff Change DATE : June 8 , 1994 ********************************************************************************* TU Electric is seeking the City's approval to obtain four new service tariffs which would apply to certain customers within the City. The request is being filed with all Cities in which TU holds the electric franchise and is not peculiar to the City of Wylie. Attached for your review you will find a copy of the letter of Darrell Prcin which accompanied the filing, the Petition and Statement of Intent requesting the new tariffs, and a proposed ordinance which grants the City's approval of the same. The Council has essentially two options with regard to the request. It may grant the approval, as requested, and adopt the ordinance. Or the Council may deny the request if it finds there exists reason for doing so. In the event of approval the new tariffs would go into effect on July 11,1994. If the request is denied I assume TU would appeal the denial to the Public Utilities Commission (PUC) in Austin who would then rule on the matter (approve, modify or deny the request) regardless of the City's previous denial. TU advises that the new tariffs are generally beneficial to the customers, which in this case is business customers only. The changes are explained as being necessary to allow TU, Cities and other entities to compete for attraction and retention of business (presumably heavy electric user ones). Without the existence of the special rates business may go places other than TU Cities such as Wylie. The argument sounds good on its face and probably is beneficial to businesses and economic development. My only concern was that if some businesses would be paying less that would likely mean that the difference would be made up by someone else, such as the residential customer. Darrell Prcin assured me this was not the case as TU will only have certain ranges within which it can reduce rates, and that reductions which would lower the price of the power to where it would be sold at a loss, thereby requiring subsidization by other customers (residential users), would not be allowed. Ultimately this would appear to be something that would enhance Wylie's attraction to prospective businesses, particularly over a competing City or area which would not have the same power incentives. Whether or not to grant the approval is an administrative decision which the Council will have to determine. From a legal perspective it is entirely proper to pass the ordinance and approve the new tariffs, so long as the Council makes a determination that addition of the new tariffs is in the best interest of the City. I also have available the "book" containing the testimony which Mr. Prcin references in his letter. I did not provide the same to the Council since it is approximately one inch thick and not very interesting reading. However, I would be happy to get the document or a copy to any or all of you should you so desire. cc: Steve Norwood 111111111111111 MUM ssonsmi TUELECTRIC Darrell Prcin Garland Manager June 6, 1994 City of Wylie 2000 N. State Hwy. 78 Wylie, TX 75098 Attached for filing please find a Petition and Statement of Intent of Texas Utilities Electric Company (TU Electric) . This filing requests approval of four tariffs and is identical to filings being made today with all of TU Electric's other regulatory authorities. Also, transmitted with this letter as part of this filing is a one- volume Rate Filing Package containing a copy of TU Electric's Petition and Statement of Intent before the Public Utility Commission of Texas and the testimony that explains and supports the approval of the proposed tariffs. The four tariffs are attached as exhibits to the testimony of Mr. Houle. Should you have any questions concerning this filing, please give me a call . Very truly yours, C224(seee:C2),CCA-s--+---- Darrell Prcin Receipt Ackno ledge - By: Ti Date: - / ; j 4.1 P.O.Box 461447 Garland,Texas 75046-1447 214 487-2222 BEFORE THE GOVERNING BODY OF THE CITY OF WYLIE, TEXAS APPLICATION OF TEXAS UTILITIES S ELECTRIC COMPANY FOR AUTHORITY S TO IMPLEMENT ECONOMIC DEVELOP- S MENT SERVICE, GENERAL SERVICE S DOCKET NO. COMPETITIVE PRICING, WHOLESALE S POWER COMPETITIVE PRICING, AND S ENVIRONMENTAL TECHNOLOGY S SERVICE S PETITION AND STATEMENT OF INTENT TO THE HONORABLE SAID GOVERNING BODY: For its Petition and Statement of Intent, Texas Utilities Electric Company ("TU Electric") , a corporation organized and existing under the laws of the State of Texas and a public utility as that term is defined in the Public Utility Regulatory Act, Article 1446c, V.A.T.S. (the "PURA") , respectfully submits the following: I. TU Electric proposes tariffs under which it seeks to offer four new services within its service territory: (1) Economic Development Service -- through proposed Rider ED, which is a rider to TU Electric's existing General Service Rates GS, GP, and HV that provides for a discounted demand charge to those that qualify under the terms of the Rider; Rider ED is designed to contribute to the economic development of the service territory by attracting new businesses and industries and the expansion by existing businesses and industries; (2) General Service Competitive Pricing -- through proposed Rate GC, which provides for a negotiated reduction, within limits, in the demand charges that would otherwise be applicable to the customer' s electrical load under TU Electric's General Service Rates GS, GP, or HV, where the customer's electrical load otherwise would not be served by the Company because, without the reduction in the demand charges, the customer would self-generate its electricity or obtain service from another energy service supplier or cease its operations; (3) Wholesale Power Competitive Pricing -- through proposed Rate WPC, which provides for a negotiated reduction, within limits, in the demand charges that would otherwise be applicable to the customer's electrical load under TU Electric's Wholesale Power Rate WP, where the customer's electrical load otherwise would not be served by the Company because, without the reduction in the demand charges, the customer would self-generate its electricity or obtain service from another energy service supplier; and (4) Environmental Technology Service -- through proposed Rider ET, which is a rider to TU Electric's existing General Service Rates GS, GP, and HV that provides for a discounted demand charge to those that qualify under the terms of the proposed Rider; proposed Rider ET is designed to encourage the use of more energy-efficient electrical technologies or processes that significantly -2- improve the quality of the environment through the use of an electrical technology, such as the substitution of an electric arc furnace for a coke-fired furnace in a metals fabrication facility or infrared heating for coating processes to reduce volatile organic compound emissions. Attached hereto and made a part hereof is a copy of the Petition and Statement of Intent being filed with the Public Utility Commission of Texas ("Commission") contemporaneously with the filing of this Petition and Statement of Intent, together with the testimony and exhibits of Dr. William E. Avera, Mr. Marc W. Goldsmith, and Mr. Stephen J. Houle, which justify the provision of these new services and the reasonableness and propriety of the provisions of the proposed tariffs. II. This municipal regulatory authority has jurisdiction over TU Electric and the subject matter hereof within this municipality's corporate limits by virtue of Sections 17 (a) , 37, and 43 of the PURA. III. In keeping with the provisions of Section 43 (a) of the PURA, TU Electric proposes that the proposed tariffs be effective on July 11, 1994 . IV. The proposed tariffs are attached as Exhibits SJH-1, SJH-2, SJH-3, and SJH-4 to the direct testimony of Mr. Stephen J. Houle, an attachment to the Petition and Statement of Intent filed with -3- the Commission. In addition to the explanation set forth in Section I hereof, the proposed tariffs are further explained in detail in Mr. Houle's testimony. V. This is not a "major change" as that term is defined in Section 43 (b) of the PURA. All of the information required by Section 43 (a) of the PURA is set forth in this Petition and Statement of Intent and the attachments hereto. The proposed tariffs will not increase TU Electric's rates but provide for reductions to the existing rates. VI. The only customers that will be affected by the proposed Economic Development Service Rider ED, the proposed General Service Competitive Pricing Rate GC, and the proposed Environmental Technology Service Rider ET are those customers that are eligible for service under TU Electric's existing General Service Rates GS, GP, and HV and that qualify for the service under the terms of the proposed tariffs. The demand charges under those proposed tariffs are less than the demand charges under Rates GS, GP, and HV, respectively. The only customers that will be affected by the proposed Wholesale Power Competitive Pricing Rate WPC are those customers that are eligible for service under TU Electric's existing Wholesale Power Rate WP and that qualify for the service under the *terms of the proposed tariff. The demand charges under this proposed tariff are less than the demand charges under Rate WP. The territory affected by this proceeding consists of the area -4- within the corporate limits of this municipality certificated to TU Electric by the Commission; however, TU Electric is seeking authority from the Commission and all of its municipal regulatory authorities to implement these four proposed tariffs, so that same will be applicable throughout all of the territories to which it is certificated to provide electric service. VII. Notice of this Petition and Statement of Intent is being published for four consecutive weeks in newspapers having general circulation in the counties in which TU Electric provides electric service. VIII. The business and mailing address of TU Electric is: Texas Utilities Electric Company 2001 Bryan Street Dallas, Texas 75201 TU Electric's business telephone number, including area code, is: (214) 812-4600 TU Electric's authorized representatives are: R. D. Keeney Vice President Texas Utilities Electric Company 2001 Bryan Street, Suite 2100 Dallas, Texas 75201 (214) 812-2778 and J. Dan Bohannan Worsham, Forsythe, Sampels & Wooldridge, L.L.P. 2001 Bryan Street, Suite 3200 Dallas, Texas 75201 (214) 979-3000 -5- General inquiries concerning this Petition and Statement of Intent should be directed to Mr. Keeney at the above-stated address and telephone. All pleadings, motions, orders, and other documents filed in this proceeding should be served upon Mr. Bohannan at the above-stated address. WHEREFORE, TU Electric prays this Honorable Governing Body to approve the proposed tariffs and authorize it to provide the requested new services; further, TU Electric prays for such other relief to which it may be justly entitled. Respectfully submitted, WORSHAM, FORSYTHE, SAMPELS & WOOLDRIDGE, L.L.P. J. Dan Bohannan State Bar No. 02563000 2001 Bryan Street, Suite 3200 Dallas, Texas 75201 Telephone: ( 14) 979-3000 Fax: (214) : .0-0011 By: t4 ii .A / 16444#44 D: Bohannan ATTO',. YS FOR TEXAS UTILITIES ELECTRIC COMPANY -6-