Energy Conservation Programs are a relatively new regulatory scheme for gas utilities that allow the companies to collect additional money in rates for implementing energy-saving measures.
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Two Conservation Energy Program applications submitted by the Texas Gas Service utility have been rejected by state regulators over their potential cost to ratepayers.
Energy Conservation Programs are a relatively new regulatory scheme for gas utilities that allow the companies to collect additional money in rates for implementing energy-saving measures. Under state law, gas utilities can submit Energy Gas Conservation portfolios to the Texas Railroad Commission for approval.
However, on Aug. 19, the agency rejected applications from TGS for Texas Conservation Program portfolios for the utilities North Service and Central-Gulf Service areas. In both instances, the Railroad Commission cited the utility’s lack of cost sharing between ratepayers and shareholders for the rejections. That is, the utility had proposed that ratepayers absorb 100 percent of program costs, while shareholders would pay none.
In both instances, TGS proposed programs included three components: a Rebate & Incentive program for residential customers, a Rebate & Incentive Program for Commercial Customers, and an Income Qualifying Program for Residential Customers. The total 2025 budgets for each application would have been $2,586,152 apiece. For the Central-Gulf Service area, this would have resulted in a $.02000 increase to the residential per Ccf customer charge. For the North Service territory, the increase would have been $.01725.
The programs were made possible through the adoption in 2023 of House Bill 2263. Rules adopted by the Railroad Commission to implement HB 2263 called for utilities to submit an initial application and then resubmit applications every three years for re-approval.
Find more information on the Railroad Commission website, under Case No. 00018221 and 00019028.