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Transmission Cost of Service FAQ

What is the Transmission Cost of Service Charge (TCOS)?

It is a pass through charge levied on utilities to cover the cost of transmission infrastructure investment in the ERCOT (Electric Reliability Council of Texas) energy market.  This fee is paid to ERCOT who then distributes the funds to transmission companies participating in ERCOT.

How is this affecting me, the customer?

You will see an increase of $0.0019 per kilowatt hour based on your monthly usage amount.  These charges will begin in February for monthly usage in January.

What is the average customer increase?

Usage LevelsCurrent BillIncluding Proposed            TCOSBill Impact
500 kwh$68.34$69.31$0.97
1100 kwh$125.87$128.00$2.13
1500 kwh$164.22$167.13$2.91
2500 kwh$260.10$264.95$4.84


Why are we being charged this?

When we do a rate study the cost of transmission is calculated in the rate, and typically we would do a rate study about every three to four years.  The City made a concerted effort to not complete a rate study until we are drawing energy from our solar and wind power contracts.  The transmission costs go up whenever additional transmission is added to the ERCOT energy grid.  Since 2011 we have absorbed these costs and are now are passing them through to the customer base.

Is this increase related to revenue requirements?

No, we had very little variance between budgeted and actual revenues in 2016.  The TCOS charge is a charge by ERCOT that allows it to recover the cost of additional transmission investments within the ERCOT energy market.