Austin Energy Rate Update – November 2023
Austin Energy again surprised us with two commercial customer rate changes announced over the past two months. On 9-7-2023, we received notice that effective 10-1-2023, Austin Energy would increase the Power Supply Adjustment (AKA fuel cost) rate by 5%. You may recall, that the Power Supply Adjustment (PSA) is intended to be a “pass-through” cost covering AE’s fuel cost and “net purchased power cost”. Apparently, AE is still trying to catch up to the “under-recovered” from various winter storms as well as the high wholesale electricity prices during the exceedingly hot summer of 2023. For those reasons “Austin Energy is exercising its administrative authority to increase the PSA rate at this time“, as they stated in their notice. The second set of rate changes were announced on 10-9-2023, and will be effective 11-1-2023. In the table below, the various rate changes can be seen, as well a summary of the rates effective 11-1-2023 for AE’s customers on the 300kW rate plan:
It is not clear to Blue Ocean if Austin Energy will implement other rate changes in 2024. The impact of the announced rate changes mentioned above will vary depending on actual kWh and kW usage. We anticipate that the net increase on energy cost in 2024 will be in the 2.5% to 3.5% range for most commercial customers. Unfortunately, Austin Water and waste water rates will also increase, effective 11-1-2023. The impact of the water rate increases will depend of usage and size of water meter/pipe. For more information regarding water cost increases, follow the link: https://www.austintexas.gov/sites/default/files/files/Water/Rates/CommercialPublicRates_2024.pdf.
Although rate increases are never pleasant, at least it seems the Austin Energy electricity rate increases are relatively modest, and certainly a far cry from the budget shattering increase of last November. If you would like assistance estimating the impact of the various rate increases for your particular building(s), please feel free to reach out. Energy and Water management remains, in our view, the best approach to mitigating increasing cost.