At its Monday board meeting, CPS Energy announced that it will not seek a rate increase for 2024, citing a combination of federal incentives, cost‑saving measures and lower borrowing costs that together provided roughly $170 million of financial flexibility.
Key savings keep rates steady for now
Chief Financial Officer Debra Wainscott explained that “unexpected favorable circumstances this year allowed us to navigate without a rate request,” noting a $115 million nuclear production incentive from the federal government and an anticipated $5 million reduction in debt‑service costs thanks to lower‑than‑expected interest rates and premiums.
In addition, a shift in the timeline for a transmission‑cost study could add another $50 million to the utility’s transmission revenue, further bolstering the budget.
Financial headwinds remain
Despite the savings, CPS Energy faces a projected shortfall of at least $50 million. Milder weather reduced retail energy sales by $40 million and wholesale revenue by $100 million, while storms and outages added $20‑$30 million in extra expenses.
The utility’s budget, first presented in March with a $50 million shortfall, sparked community discussion and dialogue with the City of San Antonio, which owns CPS Energy. Earlier this month, officials announced that rates would remain unchanged, emphasizing affordability pressures on residents.
Future rate request anticipated
Wainscott cautioned that while the current year’s metrics are strong enough to avoid a hike, the utility is still “pushing the top of that range” and will need to revisit the issue for the 2025 rate cycle.
Interim CEO Frank Almaraz echoed the sentiment, stating, “If the infrastructure needed it, CPS would have asked for it. We were able to get to a point where we do not need it this year.”
City oversight and board composition
Mayor Gina Ortiz‑Jones, who serves on the CPS Energy board, confirmed that the utility’s infrastructure needs do not currently require a rate increase. She highlighted the importance of maintaining fiscal health to keep borrowing costs low for future projects.
Board members noted that large utilities like CPS Energy must demonstrate solid financial standing to secure favorable loan terms for capital projects, reinforcing the utility’s commitment to responsible stewardship of ratepayer funds.
What’s next for San Antonio ratepayers?
While residents can breathe easier this year, the utility’s financial outlook indicates that a rate discussion will likely return in 2025. Stakeholders are encouraged to monitor upcoming board meetings and public notices for further updates.
Original reporting: San Antonio Report — read the source article.
