Council Approves AE Settlement

Utility gives up $5.75 million; keeps everything else

A City Council electric rate hearing last year.
A City Council electric rate hearing last year.
photo by Jana Birchum

Without discussion, the City Council today unanimously approved a settlement agreement between Austin Energy and out-of-city ratepayers. At first glance, the deal leaves the utility's business operations relatively unscathed, while big electricity users living outside the city will see a discount on their rates.

As part of the agreement, Austin Energy will sacrifice $5.8 million of what it had anticipated in revenues from out-of-city ratepayers.

Before the vote the Council heard from Roger Borgelt, the attorney for the petitioners, Public Citizen executive director Tom "Smitty" Smith and longtime environmental and consumer activist Paul Robbins. Only Borgelt looked happy. He thanked the Council and city staff for agreeing to the compromise. Smith said that while it isn't a perfect settlement, it's better than what might have occurred had the rate case continued to play out at the Texas Public Utility Commission. Robbins said the deal was "nothing less than welfare for the rich." He criticized the city for keeping the settlement terms under wraps until its public posting, less than 90 minutes before the Council convened to vote.

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