in Houston, Texas
Texas lawmakers target Austin Energy following City Council’s rate hike approval
Wednesday, Jul 11, 2012, 03:52PM CST
By Curt Olson

Austin Energy’s highest rate hike in history has landed the utility in the crosshairs of different elected officials who could change the way it does business.

Leaders at Austin’s monopolized electricity provider could be taking marching orders at some point in 2013 from Texas lawmakers.

This strategy could be more difficult than one thinks.

State Sen. Kirk Watson, D-Austin, now calls for a separate board to oversee Austin Energy, the Austin American-Statesman reports. Austin City Council oversees the utility now.

The former Austin mayor hedged on Texas lawmakers doing too much, calling Austin Energy’s structure a local government issue.

Meanwhile, state Rep. Paul Workman, R-Austin, says he will sponsor legislation to prohibit Austin City Council from supplementing its operations from excessive profits from customers who can’t vote for City Council.

These customers live in unincorporated areas served by Austin Energy. The newspaper reports about 13 percent of Austin Energy's 417,000 customers live outside the city’s boundaries.

Workman wants this to affect only Austin, not the 71 other municipally-owned utilities in Texas.

Austin Energy’s suburban customers have already stated they will fight the rate hike, approved by the City Council in June. They contend they will be hit with the greatest burden of the new tiered rate structure. Customers will see on average a 7 percent increase.

Austin Energy says residents should see an increase of no more than $10 a month, and no higher than $24 a month during the summer. For commercial users, the utility says the hike will be $18 a month, although it could rise much higher depending on the size of a business.

Along with potential action by Texas lawmakers in 2013, this additional round of wrestling with the utility includes the gathering of signatures for a petition to the Public Utility Commission of Texas.

The rate hike is bad enough, but it comes on the heels of multiple other revelations of spending at the utility:

Spending $123,065 in a two-and-a-half year period on employee parties and food.

National recognition for spending on solar art that won a prize for 4th most bizarre display of public art in the country.

Austin Energy customers subsidizing the utility’s push for more solar energy when there are less expensive options such as natural gas.

And if Austin Energy’s spending of its customer’s money doesn’t set off alarms, perhaps this will: When Texas Watchdog checked in on Texas’ federal stimulus programs to weatherize homes in 2010, Austin Energy was among the poorest performers in the state.

Contact Curt Olson at or 512-557-3800. Follow him on Twitter @olson_curt.

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