By Emily Banks Wooten
A growing group of citizens – both residents and business owners – have met several times and have formed a coalition called “Citizens of Livingston for Fair and Equitable Rates.” Spearheaded by Joshua Grant, the group is gathering signatures to petition the Public Utility Commission of Texas for a rate review of the City of Livingston’s electric service.
“We’re seeking a remedy for the ongoing lack of transparency from our city officials and the outrageous electric rates assessed on City of Livingston electric customers,
“Our aim is to see the city succeed by ensuring rates are beneficial for both the customers and the city. As citizens of the City of Livingston, we want to see our city be a success. A municipality’s utility should be able to make a profit and use those profits for the city’s operational needs,” Grant said. “What we will no longer tolerate is a city that knowingly overcharges its rate payers, hides behind its lack of transparency, and justifies its actions by referring to its lack of an ad valorem tax.”
Sam Rayburn Municipal Power Agency (SRMPA) is a municipal power agency formed under the Texas Utilities Code for the purpose of supplying the wholesale electrical energy needs of its member cities, Livingston, Jasper and Liberty. Bruce Mintz is the executive director of SRMPA and has served in that capacity since 2012.
SRMPA is governed by a board of directors that consists of six directors – two from each member city – who serve without compensation. The board sets the agency’s policies and administrative procedures which are administered by the executive director at the direction of the board.
“In 2011, SRMPA entered into a new purchase power agreement with Entergy, binding for 30 years, to serve the needs of its three member cities. The capacity charge in the power agreement is $9.75 per kilowatt-hour month but the market price for capacity is below $6 per kWh month,” he said.
Grant explained that there are three components to an energy bill – base rate, capacity charge and actual fuel cost which is supposed to be a pass-through.
“Base rate is what the city should be setting every year, based off of cost of services to customers – salaries, operations and maintenance, trucks, other depreciated assets, capital investment for utility. The city can say we need to make a rate of return on our investment.
“The fuel component, the fuel that Entergy burns, makes up about 70% of your bill. In October 2022, fuel prices were really, really high, However, in February, those prices dropped about 300%. SRMPA went from $80 per megawatt to $70 to $60 to $50 to $40. But the City of Livingston is still charging $80 per mW even though the price they’re paying is $40 per mW,” Grant said.
“The bill only shows usage and the amount you owe. That’s a problem with me because it’s a lack of transparency. It does fluctuate, but most utilities will attach a rider over a long period.
“At some point, SRMPA under-collected from its member cities. The actual price of fuel is $20 per mW right now. It should be a pass-through cost. Normally, commercial is cheaper than residential, but not here and not in Jasper,” Grant said.
The rate breakdown in October 2022 reflected that 29% of the electric bill was base rate, 17% was capacity and 54% was fuel. The rate breakdown in July 2023, according to SRMPA charges, reflects 29% is base rate, 15% is capacity, 27% is fuel and 29% is overcollection. The rate breakdown in Jule 2023, according to market fuel price, reflects 14% is capacity, 14% is fuel, 29% is base rate and 43% is overcollection.
“The overcollection is the highest portion of the bill at this time. We’re still being seriously overcharged for fuel. The other two member cities are adjusting this rate,” he said.
“City officials continue to point to the lack of an ad valorem tax as justification for its electrical rates. At least an ad valorem tax is capped, it’s regulated, it can be voted on. I’m not here to run the city down. I own a home here. I run a business. I work from home. Talk to people about this. Most people don’t know about this. The city council sets our rates but they’re doing it on what I think is a lack of knowledge,” Grant said.