CPS Energy appears to realize that shoveling huge bonuses into the pockets of utility executives right before asking for a substantial rate increase from it's customers qualifies as the dumb public relations move of the year.
But 1200 WOAI news reports the jury is still out on whether changes made in the utility's bonus program will be enough to calm what one council member openly described as 'anger' over the payments, and convince council to approve CPS Energy's proposed 4.75% rate increase request.
"I believe that they hear loudly and clearly that the public does not stomach both the bonuses and a rate increase request," Mayor Julian Castro said.
The utility made its first pitch for the rate hike on Wednesday, telling council that the growth of the city, including expansion on the north and south sides, make a rate increase necessary. Utility executives say it is a myth that hook up fees and bills paid by new ratepayers cover the costs of expansion, pointing out that it takes years to make up for the expense of new substations, light poles, and connections.
"To the extent that we have a growing demand for electricity and we are in a growing city, I believe a rate increase is necessary," Castro said.
Council will take a final vote on the proposal next month. This is set to be the first of three annual rate hikes. The one currently on the table would increase the average family's electric bill by about $5.15 a month.
The utility has proposed a new incentive pay structure that would pump some $4 million previously earmarked for executive bonuses to the REAP program to benefit low income customers.
Will it be enough? Mayor Castro isn't certain.
"How much that rate increase is, and what we do about the issue of those bonuses, I believe is where there is room for negotiation," he said.