Oncor credited the $62 million year-over-year increase to additional customer consumption due to warmer weather, transmission and base rate hikes, and interim Distribution Cost Recovery Factor (“DCRF”) adjustments.
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Oncor Electric Delivery Company received net income of $380 million during the three months ending September 30, as compared to net income of $318 million during the corresponding period in 2022, according to a Nov. 3 company report to investors.
Oncor credited the $62 million year-over-year increase to additional customer consumption due to warmer weather, transmission and base rate hikes, and interim Distribution Cost Recovery Factor (“DCRF”) adjustments.
Oncor also reported that its distribution revenues in the three months ending September 30, as compared to the three months during the previous-year period, increased by 18.5 percent – or 11.9 percent on a weather-normalized basis. Oncor said the change included a 28.1 percent increase in distribution base revenues from residential customers (15.7 percent increase on a weather-normalized basis), and a 10.9 percent increase in distribution base revenues from large commercial and industrial customers.
Capital Expenditure Plans
Oncor expects to soon announce a new five-year capital plan for the 2024-2028 period, and anticipates that it will reflect significantly increased spending as compared to its previously announced $19.2 billion capital plan for the 2023-2027 period. Officials said that continued growth in its service territory, increases in borrowing costs, increases in the cost of materials and increased labor costs will drive the spending increases. Oncor also anticipates additional capital spending related to transmission and distribution system resiliency investments pursuant to recently enacted Texas House Bill 2555. The PUC’s rules for HB 2555 are expected to be finalized during the fourth quarter of 2023.
Oncor’s board of directors previously approved a 2023 capital expenditures budget of $3.6 billion.
Growth Within Oncor’s Service Territory
The company noted that it connected approximately 20,000 new premises to the ERCOT grid as compared to approximately 14,000 during the corresponding three-month period in 2022. In addition, Oncor may soon set a company record for annual new and active generation and retail transmission point-of-interconnection (“POI”) requests in queue. As of September 30, it had 755 active generation and retail transmission POI requests in queue, representing a 34 percent increase from the corresponding prior-year period. Of the 447 active generation POI requests in queue, 47 percent were solar, 41 percent were storage, 9 percent were wind and 3 percent were gas, Oncor reported.
Regulatory Updates
On September 22, Oncor filed an appeal in Travis County District Court relating to its recent comprehensive base rate review proceeding. The appeal seeks judicial review of certain of the rate base disallowances. On September 15, Oncor filed its second application this year for an interim DCRF rate adjustment to recover additional distribution investments that went into service in the period January 1, 2023, through June 30, 2023. Oncor estimates that its interim DCRF rate adjustment would result in an annual revenue impact of approximately $56 million if approved as requested.
About Oncor
Headquartered in Dallas, Oncor (together with its subsidiaries) operates the largest transmission and distribution system in Texas, delivering power to more than 3.9 million homes and businesses and operating more than 141,000 miles of transmission and distribution lines in Texas. Oncor is owned by two investors — California-based Sempra and minority owner, Texas Transmission Investment LLC.