Texas PUC Orders Rate Reduction

Texas PUC Orders Rate Reduction

The Texas Public Utility Commission (PUC) reprimanded Entergy Gulf States, the electric utility serving southeast Texas, by ordering a rate reduction for poor service. The commission specifically cited performance problems that occurred during the ice storm that battered the region a year ago.

The PUC`s order was unusual, since quality of service is typically not an issue in rate cases. The last order of this type in Texas came in 1982 against Houston Lighting & Power Co. for deteriorating management.

The commission found that the service problems in this instance were so severe, they had to be addressed. Entergy Gulf States had argued it was only facing a “customer perception” problem. According to testimony given by A.R. Kimler, Port Neches city manager, volunteer firefighters were called by the municipality to disconnect live electric wires because the company`s personnel were not available. “It is hardly a perception problem,” Kimler said.

The PUC blamed the performance problems on Entergy Gulf States` laying off of experienced personnel following the merger of Entergy and Gulf States in 1993. The final amount of the rate reduction has yet to be calculated, but it could amount to as much as $4 million a year.

Entergy Gulf States` 318,297 customers will not begin seeing the rate reduction on their bills until a final order is filed, which will probably be in the next three to six months.

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