Company: SREA
Filing Date: 2025-08-07
Form Type: 10-Q
Source: 0001032208-25-000048
Chunk: 127

Company: SEMPRA
Filing Date: 2025-08-07
Form: 10-Q
Item: Item 1
Chunk 127
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 request for an interim revenue requirement increase of $360 million over current adjusted rates, which excludes certain requested adjustments in the pending base rate proceeding, including the requested modifications to Oncor’s regulatory capital structure, authorized return on equity, and self-insurance reserve accrual. PUCT rules provide that interim rate relief may be granted upon the agreement of all parties to the proceeding, and that absent such agreement the administrative law judge administering the proceeding may grant interim rate relief upon a showing of good cause. If they become effective, such interim rates would be subject to refund or surcharge to the extent the rates ultimately established in the base rate proceeding are different from the interim rates.

Appeal of 2023 Comprehensive Base Rate Review Order. The PUCT issued a final order in Oncor’s comprehensive base rate proceeding in April 2023, and rates implementing that order went into effect on May 1, 2023. In June 2023, the PUCT issued an order on rehearing in response to the motions for rehearing filed by Oncor and certain intervening parties in the proceeding. The order on rehearing made certain technical and typographical corrections to the final order but otherwise affirmed the material provisions of the final order and did not require modification of the rates that went into effect on May 1, 2023. In September 2023, Oncor filed an appeal in Travis County District Court seeking judicial review of certain rate base disallowances and related expense effects of those disallowances in the PUCT’s order on rehearing. In February 2024, the court dismissed the appeal for lack of jurisdiction. In March 2024, Oncor appealed the court’s dismissal, which is currently with the Fifteenth Court of Appeals in Texas. Oral argument on the appeal was held on April 15, 2025.

Unified Tracker Mechanism. In June 2025, Texas House Bill 5247 was signed into law and became effective. The bill establishes what is known as the UTM, which creates an alternative method, available through 2035, for qualifying electric utilities to apply for interim rate adjustments once annually using a comprehensive regulatory filing for cost recovery of certain transmission and distribution capital expenditures.

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A qualifying utility electing to use the UTM is permitted to defer all or a portion of the costs associated with its eligible transmission and distribution capital investments placed into service during the period covered by the UTM, including depreciation expense and carrying costs, as a regulatory asset. Texas House Bill 5247 provides