The City has coordinated its review of Atmos-WTX’s prior applications to change rates as part of a group of cities comprised of Amarillo, Lubbock, Dalhart, and Channing, and has been represented by the law firm of Herrera Law & Associated, PLLC (through Mr. Alfred R. Herrera) to assist in reviewing applications to change rates submitted by Atmos-WTX. “GRIP” RATE APPLICATIONS Under section 104.301 of the Gas Utility Regulatory Act (GURA), a gas utility is allowed to request increases in its rates to recover a return on investments it makes between rate cases. This section of GURA is commonly referred to as the “GRIP” statute (the Gas Reliability Infrastructure Program). Under a decision by the Supreme Court of Texas, the Court concluded that a filing made under the GRIP statute, permitted gas utilities the opportunity to recover a return on capital expenditures made during the interim period between rate cases, by applying for interim rate adjustment, and that proceedings under the GRIP statute did not contemplate either adjudicative hearings or substantive review of utilities' filings for interim rate adjustments. Instead, the Court concluded, the GRIP statute provides for a ministerial review of the utility’s filings, to ensure compliance with the GRIP statute and the Railroad Commission’s rules, and that it is within the Railroad Commission’s authority to preclude cities from intervening and obtaining a hearing before the Railroad Commission. Atmos-WTX’S “GRIP” APPLICATION On or about February 24, 2023, Atmos-WTX filed for an increase in gas utility rates under the Gas Reliability Infrastructure Program (‘GRIP”). Atmos-WTX’s application when approved by the Railroad Commission will result in an increase in the monthly customer charges as shown in the following table.
Rate
Schedule
|
Current Customer Charge |
Proposed 2022
Interim Adjustment
|
Adjusted Customer Charge |
Monthly Increase to Each Bill |
Residential Gas Service |
$17.83 per customer
monthly
|
$3.19 per customer
monthly
|
$21.02 per customer
monthly
|
$3.19 per
customer monthly
|
Commercial Gas Service |
$58.79 per customer monthly |
$10.15 per customer
monthly
|
$68.94 per customer monthly |
$10.15 per
customer monthly
|
Industrial/Transportation Gas Service |
$677.87 per customer monthly |
$169.23 per customer monthly |
$847.10 per customer monthly |
$169.23 per customer monthly |
Public Authority Gas Service |
$65.84 per customer monthly |
$18.44 per customer monthly |
$84.28 per customer monthly |
$18.44 per customer monthly |
Note that Atmos-WTX refers to its application as its “2022” interim adjustment because the increase in rates Atmos-WTX presents in its application is based on capital expenditures it made from January 1, 2022, through December 31, 2022. REVIEW AND ACTION RECOMMENDED Although the City’s ability to review and effectuate a change in Atmos-WTX requested increase is limited, the City should exercise due diligence with regard to rate increases by monopoly utilities who operate within its boundaries, including increases requested under the GRIP statute to ensure compliance with the requirements of that law. To exercise its due diligence, it is necessary to suspend Atmos-WTX proposed effective date of April 25, 2023, for forty-five days, so that the City can evaluate whether the data and calculations in Atmos-WTX’s rate application are correctly done, and whether Atmos-WTX’s application otherwise conforms to the requirements of the GRIP statute. Therefore, the City’s Special Counsel, the law firm of Herrera Law & Associates, PLLC (through Alfred R. Herrera) recommends that the City adopt a resolution suspending Atmos-WTX’s proposed effective date for 45 days. Assuming a proposed effective date of April 25, 2023, Atmos-WTX’s proposed effective date is suspended until June 9, 2023. The City must take action to suspend Atmos-WTX’s proposed effective date by no later than April 25, 2023. A copy of Atmos-WTX's filing is available for review in the City Secretary's Office. |