The URL can be used to link to this page

Home My WebLink AboutOrdinance 3757 ORDINANCE NO. 3757 AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF NORTH RICHLAND HILLS, TEXAS, APPROVING A NEGOTIATED SETTLEMENT BETWEEN THE ATMOS CITIES STEERING COMMITTEE ("ACSC") AND ATMOS ENERGY CORP., MID-TEX DIVISION REGARDING THE COMPANY'S 2022 RATE REVIEW MECHANISM FILING; DECLARING EXISTING RATES TO BE UNREASONABLE; ADOPTING TARIFFS THAT REFLECT RATE ADJUSTMENTS CONSISTENT WITH THE NEGOTIATED SETTLEMENT; FINDING THE RATES TO BE SET BY THE ATTACHED SETTLEMENT TARIFFS TO BE JUST AND REASONABLE AND IN THE PUBLIC INTEREST; APPROVING AN ATTACHED EXHIBIT I ESTABLISHING A BENCHMARK FOR PENSIONS AND RETIREE MEDICAL BENEFITS; REQUIRING THE COMPANY TO REIMBURSE ACSC'S REASONABLE RATEMAKING EXPENSES; DETERMINING THAT THIS ORDINANCE WAS PASSED IN ACCORDANCE WITH THE REQUIREMENTS OF THE TEXAS OPEN MEETINGS ACT; ADOPTING A SAVINGS CLAUSE; DECLARING AN EFFECTIVE DATE; AND REQUIRING DELIVERY OF THIS RESOLUTION TO THE COMPANY AND THE ACSC'S LEGAL COUNSEL. WHEREAS, the City of North Richland Hills, Texas ("City") is a gas utility customer of Atmos Energy Corp., Mid-Tex Division ("Atmos Mid-Tex" or "Company"), and a regulatory authority with an interest in the rates, charges, and services of Atmos Mid-Tex; and WHEREAS, the City is a member of the Atmos Cities Steering Committee ("ACSC"), a coalition of similarly-situated cities served by Atmos Mid-Tex ("ACSC Cities") that have joined together to facilitate the review of, and response to, natural gas issues affecting rates charged in the Atmos Mid-Tex service area; and WHEREAS, ACSC and the Company worked collaboratively to develop a Rate Review Mechanism ("RRM") tariff that allows for an expedited rate review process by ACSC Cities as a substitute to the Gas Reliability Infrastructure Program ("GRIP") process instituted by the Legislature, and that will establish rates for the ACSC Cities based on the system-wide cost of serving the Atmos Mid-Tex Division; and WHEREAS, the current RRM tariff was adopted by the City in a rate ordinance in III' 2021; and WHEREAS, on about April 1, 2022, Atmos Mid-Tex filed its 2022 RRM rate request with ACSC Cities based on a test year ending December 31, 2021; and Ordinance No.3757 Page 1 of 4 WHEREAS, ACSC coordinated its review of the Atmos Mid-Tex 2022 RRM filing through its Executive Committee, assisted by ACSC's attorneys and consultants, to resolve issues identified in the Company's RRM filing; and WHEREAS, the Executive Committee, as well as ACSC's counsel and consultants, recommend that ACSC Cities approve an increase in base rates for Atmos Mid-Tex of $115 million on a systemwide basis with an Effective Date of October 1, 2022; and WHEREAS, ACSC agrees that Atmos' plant-in-service is reasonable; and WHEREAS, with the exception of approved plant-in-service, ACSC is not foreclosed from future reasonableness evaluation of costs associated with incidents related to gas leaks; and WHEREAS, the attached tariffs (Attachment 1) implementing new rates are consistent with the recommendation of the ACSC Executive Committee, are agreed to by the Company, and are just, reasonable, and in the public interest; and WHEREAS, the settlement agreement sets a new benchmark for pensions and retiree medical benefits (Attachment 2); and WHEREAS, the RRM Tariff contemplates reimbursement of ACSC's reasonable expenses associated with RRM applications; NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF NORTH RICHLAND HILLS, TEXAS, THAT: Section 1. The findings set forth in this Ordinance are hereby in all things approved. Section 2. That, without prejudice to future litigation of any issue identified by ACSC, the City Council finds that the settled amount of an increase in revenues of $115 million on a systemwide basis represents a comprehensive settlement of gas utility rate issues affecting the rates, operations, and services offered by Atmos Mid-Tex within the municipal limits arising from Atmos Mid-Tex's 2022 RRM filing, is in the public interest, and is consistent with the City's authority under Section 103.001 of the Texas Utilities Code. Section 3. That despite finding Atmos Mid-Tex's plant-in-service to be reasonable, ACSC is not foreclosed in future cases from evaluating the reasonableness of costs associated with incidents involving leaks of natural gas. Ordinance No.3757 Page 2 of 4 Section 4. That the existing rates for natural gas service provided by Atmos Mid-Tex are unreasonable. The new tariffs attached hereto and incorporated herein as Attachment 1, are just and reasonable, and are designed to allow Atmos Mid-Tex to recover annually an additional $115 million on a systemwide basis, over the amount allowed under currently approved rates. Such tariffs are hereby adopted. Section 5. That the ratemaking treatment for pensions and retiree medical benefits in Atmos Mid-Tex's next RRM filing shall be as set forth on Attachment 2, attached hereto and incorporated herein. Section 6. That Atmos Mid-Tex shall reimburse the reasonable ratemaking expenses of the ACSC in processing the Company's 2022 RRM filing. Section 7. That to the extent any resolution or ordinance previously adopted by the Council is inconsistent with this Ordinance, it is hereby repealed. Section 8. That the meeting at which this Ordinance was approved was in all things conducted in strict compliance with the Texas Open Meetings Act, Texas Government Code, Chapter 551. Section 9. That if any one or more sections or clauses of this Ordinance is adjudged to be unconstitutional or invalid, such judgment shall not affect, impair, or invalidate the remaining provisions of this Ordinance, and the remaining provisions of the Ordinance shall be interpreted as if the offending section or clause never existed. Section 10. That consistent with the City Ordinance that established the RRM process, this Ordinance shall become effective from and after its passage with rates authorized by attached tariffs to be effective for bills rendered on or after October 1, 2022. Section 11. That a copy of this Ordinance shall be sent to Atmos Mid-Tex, care of Chris Felan, Vice President of Rates and Regulatory Affairs Mid-Tex Division, Atmos Energy Corporation, 5420 LBJ Freeway, Suite 1862, Dallas, Texas 75240, and to Thomas Brocato, General Counsel to ACSC, at Lloyd Gosselink Rochelle & Townsend, P.C., 816 Congress Avenue, Suite 1900, Austin, Texas 78701. AND IT IS SO ORDAINED. PASSED AND APPROVED on this 12th day of September 2022. Ordinance No.3757 Page 3 of 4 CITY OF RT HLA HILLS By: 0 ar Trevino, yor ATTEST: \� " �. •4404 b h Alicia Richardson nt City Secretary/Chief Governa �,� �� r ��`\\` APPROVED AS TO FORM: Maleshia B. McGinnis, City Attorney APPROVED AS TO CONTENT: Karen Manila, Assistant City Manager Ordinance No.3757 Page 4 of 4 Ordinance No.3757 Attachment 1 Page 1 of 8 MID-TEX DIVISION ATMOS ENERGY CORPORATION RATE SCHEDULE: R—RESIDENTIAL SALES APPLICABLE TO: ALL CUSTOMERS IN THE MID-TEX DIVISION UNDER THE RRM TARIFF EFFECTIVE DATE: Bills Rendered on or after 10/01/2022 Application Applicable to Residential Customers for all natural gas provided at one Point of Delivery and measured through one meter. Type of Service Where service of the type desired by Customer is not already available at the Point of Delivery, additional charges and special contract arrangements between Company and Customer may be required prior to service being furnished. Monthly Rate Customer's monthly bill will be calculated by adding the following Customer and Ccf charges to the amounts due under the riders listed below: 'Charge Amount Customer Charge per Bill $21.55 per month Rider CEE Surcharge $ 0.05 per month' Total Customer Charge $21.60 per month Commodity Charge—All Ccf $0.36223 per Ccf Gas Cost Recovery: Plus an amount for gas costs and upstream transportation costs calculated in accordance with Part(a) and Part(b), respectively, of Rider GCR. Weather Normalization Adjustment: Plus or Minus an amount for weather normalization calculated in accordance with Rider WNA. Franchise Fee Adjustment: Plus an amount for franchise fees calculated in accordance with Rider FF. Rider FF is only applicable to customers inside the corporate limits of any incorporated municipality. Tax Adjustment: Plus an amount for tax calculated in accordance with Rider TAX. Surcharges: Plus an amount for surcharges calculated in accordance with the applicable rider(s). Agreement An Agreement for Gas Service may be required. Notice Service hereunder and the rates for services provided are subject to the orders of regulatory bodies having jurisdiction and to the Company's Tariff for Gas Service. 'Reference Rider CEE-Conservation and Energy Efficiency as approved in GUD 10170. Surcharge billing effective July 1,2022. Ordinance No.3757 Attachment 1 Page 2 of 8 MID-TEX DIVISION ATMOS ENERGY CORPORATION RATE SCHEDULE: C—COMMERCIAL SALES APPLICABLE TO: ALL CUSTOMERS IN THE MID-TEX DIVISION UNDER THE RRM TARIFF EFFECTIVE DATE: Bills Rendered on or after 10/01/2022 Application Applicable to Commercial Customers for all natural gas provided at one Point of Delivery and measured through one meter and to Industrial Customers with an average annual usage of less than 30,000 Ccf. Type of Service Where service of the type desired by Customer is not already available at the Point of Delivery, additional charges and special contract arrangements between Company and Customer may be required prior to service being furnished. Monthly Rate Customer's monthly bill will be calculated by adding the following Customer and Ccf charges to the amounts due under the riders listed below: Charge Amount Customer Charge per Bill $63.50 per month Rider CEE Surcharge ($ 0.01) per month' Total Customer Charge $63.49 per month Commodity Charge—All Ccf $0.14137 per Ccf Gas Cost Recovery: Plus an amount for gas costs and upstream transportation costs calculated in accordance with Part(a) and Part(b), respectively, of Rider GCR. Weather Normalization Adjustment: Plus or Minus an amount for weather normalization calculated in accordance with Rider WNA. Franchise Fee Adjustment: Plus an amount for franchise fees calculated in accordance with Rider FF. Rider FF is only applicable to customers inside the corporate limits of any incorporated municipality. Tax Adjustment: Plus an amount for tax calculated in accordance with Rider TAX. Surcharges: Plus an amount for surcharges calculated in accordance with the applicable rider(s). Agreement An Agreement for Gas Service may be required. Notice Service hereunder and the rates for services provided are subject to the orders of regulatory bodies having jurisdiction and to the Company's Tariff for Gas Service. 1 Reference Rider CEE-Conservation and Energy Efficiency as approved in GUD 10170. Surcharge billing effective July 1,2022. Ordinance No.3757 Attachment 1 Page 3 of 8 MID-TEX DIVISION ATMOS ENERGY CORPORATION RATE SCHEDULE: I—INDUSTRIAL SALES APPLICABLE TO: ALL CUSTOMERS IN THE MID-TEX DIVISION UNDER THE RRM TARIFF EFFECTIVE DATE: Bills Rendered on or after 10/01/2022 Application Applicable to Industrial Customers with a maximum daily usage(MDU) of less than 3,500 MMBtu per day for all natural gas provided at one Point of Delivery and measured through one meter. Service for Industrial Customers with an MDU equal to or greater than 3,500 MMBtu per day will be provided at Company's sole option and will require special contract arrangements between Company and Customer. Type of Service Where service of the type desired by Customer is not already available at the Point of Delivery, additional charges and special contract arrangements between Company and Customer may be required prior to service being furnished. Monthly Rate Customer's monthly bill will be calculated by adding the following Customer and MMBtu charges to the amounts due under the riders listed below: Charge - Amount ,. Customer Charge per Meter $ 1,204.50 per month First 0 MMBtu to 1,500 MMBtu $0.4939 per MMBtu Next 3,500 MMBtu $0.3617 per MMBtu All MMBtu over 5,000 MMBtu $0.0776 per MMBtu Gas Cost Recovery: Plus an amount for gas costs and upstream transportation costs calculated in accordance with Part(a) and Part(b), respectively, of Rider GCR. Franchise Fee Adjustment: Plus an amount for franchise fees calculated in accordance with Rider FF. Rider FF is only applicable to customers inside the corporate limits of any incorporated municipality. Tax Adjustment: Plus an amount for tax calculated in accordance with Rider TAX. Surcharges: Plus an amount for surcharges calculated in accordance with the applicable rider(s). Curtailment Overpull Fee Upon notification by Company of an event of curtailment or interruption of Customer's deliveries, Customer will, for each MMBtu delivered in excess of the stated level of curtailment or interruption, pay Company 200% of the midpoint price for the Katy point listed in Platts Gas Daily published for the applicable Gas Day in the table entitled"Daily Price Survey." Replacement Index In the event the "midpoint" or "common" price for the Katy point listed in Platts Gas Daily in the table entitled"Daily Price Survey" is no longer published, Company will calculate the applicable imbalance fees utilizing a daily price index recognized as authoritative by the natural gas industry and most closely approximating the applicable index. Ordinance No.3757 Attachment 1 Page 4 of 8 MID-TEX DIVISION ATMOS ENERGY CORPORATION RATE SCHEDULE: I—INDUSTRIAL SALES APPLICABLE TO: ALL CUSTOMERS IN THE MID-TEX DIVISION UNDER THE RRM TARIFF EFFECTIVE DATE: Bills Rendered on or after 10/01/2022 Agreement An Agreement for Gas Service may be required. Notice Service hereunder and the rates for services provided are subject to the orders of regulatory bodies having jurisdiction and to the Company's Tariff for Gas Service. Special Conditions In order to receive service under Rate I, Customer must have the type of meter required by Company. Customer must pay Company all costs associated with the acquisition and installation of the meter. Ordinance No.3757 Attachment 1 Page 5 of 8 MID-TEX DIVISION ATMOS ENERGY CORPORATION RATE SCHEDULE: T—TRANSPORTATION APPLICABLE TO: ALL CUSTOMERS IN THE MID-TEX DIVISION UNDER THE RRM TARIFF EFFECTIVE DATE: Bills Rendered on or after 10/01/2022 Application Applicable, in the event that Company has entered into a Transportation Agreement, to a customer directly connected to the Atmos Energy Corp., Mid-Tex Division Distribution System (Customer) for the transportation of all natural gas supplied by Customer or Customer's agent at one Point of Delivery for use in Customer's facility. Type of Service Where service of the type desired by Customer is not already available at the Point of Delivery, additional charges and special contract arrangements between Company and Customer may be required prior to service being furnished. Monthly Rate Customer's bill will be calculated by adding the following Customer and MMBtu charges to the amounts and quantities due under the riders listed below: Charge Amount Customer Charge per Meter $ 1,204.50 per month First 0 MMBtu to 1,500 MMBtu $0.4939 per MMBtu Next 3,500 MMBtu $0.3617 per MMBtu All MMBtu over 5,000 MMBtu $0.0776 per MMBtu Upstream Transportation Cost Recovery: Plus an amount for upstream transportation costs in accordance with Part(b) of Rider GCR. Retention Adjustment: Plus a quantity of gas as calculated in accordance with Rider RA. Franchise Fee Adjustment: Plus an amount for franchise fees calculated in accordance with Rider FF. Rider FF is only applicable to customers inside the corporate limits of any incorporated municipality. Tax Adjustment: Plus an amount for tax calculated in accordance with Rider TAX. Surcharges: Plus an amount for surcharges calculated in accordance with the applicable rider(s). Imbalance Fees All fees charged to Customer under this Rate Schedule will be charged based on the quantities determined under the applicable Transportation Agreement and quantities will not be aggregated for any Customer with multiple Transportation Agreements for the purposes of such fees. Monthly Imbalance Fees Customer shall pay Company the greater of(i) $0.10 per MMBtu, or(ii) 150% of the difference per MMBtu between the highest and lowest "midpoint" price for the Katy point listed in Platts Gas Daily in the table entitled "Daily Price Survey" during such month, for the MMBtu of Customer's monthly Cumulative Imbalance, as defined in the applicable Transportation Agreement, at the end of each month that exceeds 10% of Customer's receipt quantities for the month. Ordinance No.3757 Attachment 1 Page 6 of 8 MID-TEX DIVISION ATMOS ENERGY CORPORATION RATE SCHEDULE: T—TRANSPORTATION APPLICABLE TO: ALL CUSTOMERS IN THE MID-TEX DIVISION UNDER THE RRM TARIFF EFFECTIVE DATE: Bills Rendered on or after 10/01/2022 Curtailment Overpull Fee Upon notification by Company of an event of curtailment or interruption of Customer's deliveries, Customer will, for each MMBtu delivered in excess of the stated level of curtailment or interruption, pay Company 200% of the midpoint price for the Katy point listed in Platts Gas Daily published for the applicable Gas Day in the table entitled "Daily Price Survey." Replacement Index In the event the "midpoint" or "common" price for the Katy point listed in Platts Gas Daily in the table entitled "Daily Price Survey" is no longer published, Company will calculate the applicable imbalance fees utilizing a daily price index recognized as authoritative by the natural gas industry and most closely approximating the applicable index. Agreement A transportation agreement is required. Notice Service hereunder and the rates for services provided are subject to the orders of regulatory bodies having jurisdiction and to the Company's Tariff for Gas Service. Special Conditions In order to receive service under Rate T, customer must have the type of meter required by Company. Customer must pay Company all costs associated with the acquisition and installation of the meter. Ordinance No.3757 Attachment 1 Page 7 of 8 MID-TEX DIVISION ATMOS ENERGY CORPORATION RIDER: WNA—WEATHER NORMALIZATION ADJUSTMENT I'I APPLICABLE TO: ALL CUSTOMERS IN THE MID-TEX DIVISION UNDER THE RRM TARIFF EFFECTIVE DATE: Bills Rendered on or after 10/01/2022 Provisions for Adiustment The Commodity Charge per Ccf(100 cubic feet) for gas service set forth in any Rate Schedules utilized by the cities of the Mid-Tex Division service area for determining normalized winter period revenues shall be adjusted by an amount hereinafter described, which amount is referred to as the "Weather Normalization Adjustment." The Weather Normalization Adjustment shall apply to all temperature sensitive residential and commercial bills based on meters read during the revenue months of November through April. The five regional weather stations are Abilene,Austin, Dallas, Waco, and Wichita Falls. Computation of Weather Normalization Adiustment The Weather Normalization Adjustment Factor shall be computed to the nearest one-hundredth cent per Ccf by the following formula: (HSFi x (NDD-ADD)) WNAFi = Ri (BLi + (HSFi x ADD) ) Where i = any particular Rate Schedule or billing classification within any such particular Rate Schedule that contains more than one billing classification WNAFi = Weather Normalization Adjustment Factor for the ith rate schedule or classification expressed in cents per Ccf Ri = Commodity Charge rate of temperature sensitive sales for the ith schedule or classification. HSFi = heat sensitive factor for the ith schedule or classification divided by the average bill count in that class NDD = billing cycle normal heating degree days calculated as the simple ten-year average of actual heating degree days. ADD = billing cycle actual heating degree days. Bli = base load sales for the ith schedule or classification divided by the average bill count in that class The Weather Normalization Adjustment for the jth customer in ith rate schedule is computed as: WNA = WNAFi x q;; Where q;; is the relevant sales quantity for the jth customer in ith rate schedule. Ordinance No.3757 Attachment 1 Page 8 of 8 MID-TEX DIVISION ATMOS ENERGY CORPORATION RIDER: WNA—WEATHER NORMALIZATION ADJUSTMENT APPLICABLE TO: ALL CUSTOMERS IN THE MID-TEX DIVISION UNDER THE RRM TARIFF EFFECTIVE DATE: Bills Rendered on or after 10/01/2022 Base Use/Heat Use Factors Residential Commercial Base use Heat use Base use Heat use Weather Station Ccf Ccf/HDD Ccf Ccf/HDD Abilene 10.58 0.1422 88.85 0.6666 Austin 9.90 0.1372 233.56 0.7819 Dallas 14.17 0.1938 186.38 0.9394 Waco 10.07 0.1308 140.10 0.7170 Wichita 11.43 0.1398 131.57 0.5610 Falls Weather Normalization Adjustment(WNA) Report On or before June 1 of each year, the company posts on its website at atmosenergy.com/mtx-wna, in Excel format, a Weather Normalization Adjustment(WNA) Report to show how the company calculated its WNAs factor during the preceding winter season. Additionally, on or before June 1 of each year, the company files one hard copy and an Excel version of the WNA Report with the Railroad Commission of Texas' Gas Services Division, addressed to the Director of that Division. 1,- (N1- C- .0 O M N o o• La) u. @ a) 0I C as oo COO cp co C Mr a N Q £ la co N M N CD C V) O d1 co- .- Y 3F- a) 'O E C O Q .0 69 69 E9 U Q. N_ o M o C+) o C) Ui -0 @ w C a0 01 0 O) 0 CO M w a) co W V O V CD Cl. C`) _C T N A a V CD CND 0 CND CO O O as c aaC ? @ £ m z W 00 U v E9 De 69 69 69 2 c w o 0 0 0 a ..— w yr? C MOMOM 0 VV .2 a- C a) M 0 M 0 CO- .a V C a a m co co s_ CO co >, coaco co9 N m m > co v w F- O.;,, a a)w a o 2y m ao W 69 E9 69 E9 E9 m mu, N o N o N OR O O F. N CO CO 0 W O O O U Q O Co co O co co Ca ISO - O� CO M� O CO r 0 CO M M �i a. •N C-p v v O) W O.Et c O" co- N N LLIL O. a C, aw Z W Q 69 69 69 69 E9 C N• O F- N W o co o co o CD CD @ `Q f/�V N N r V O V co E. O co cii Q@ C]OM N Aa UNO V M OM r U7 U) LLI@w u. N O _O ° C) V V M M a W(A W a)a Q C... ? p"O F; , 0 c) £ a) c E a m W w a) C9 co-c W m E9 CA E9 E9 C- 53 �W W 'O M o op o co o O 0 0 E -0 f@i) amC] a R N � 0 ro w= n 0 a roo re co s � rr r N N as Nsv C0000 r �r O O C c N a 0C) @ >- OC C O O C) 0) C O C EZwQ Q @ aa W CO E9 v) E9 E9 •p a) @ ill CCU C O t-° m w 0)OI- °- o0 I- H CA c z G w X a i Z J v mwtF' N N w O O 3 o .w y 0 0 C a) 3 - @ @ @ w .co ~ x UN _y p Q U 0. M =v COZ5 a). N C O a) CnW7 'O N@OO N @ O a) N Z� O C m a O a)r C @ fs O Q N co a) @'0 U L -• @ Ta Q O N a u2 >- m U 3 TU.". U @ W C t`.. O@ N 2 co N N N N J co =C@ X N a),N O U p U N CO a) @.@ U Y Y @ - @ @ .c W Q+.+ l0 v l6 CD @ > a C> U O U p E E O E Q 0I @ m O .t.+ O ° U.N.. U U Cl a J a) O U @- @ a) p@ ¢ C co W + ea •C .2--a O m X m m O O 7 E p y O V N I- N Q@ N U CoC� T R p_p_a) o@ 4= O w@ w C) @ U O C C a O j 9 @ Cn "0 @ @ O LL Q a @ J @ w C z 2 C O_C 0 0 c E E + o O Ca C a)'O a) @ a) QS co co P. m ULb O N N LLl Q- C •X O C a) @ O@ C N Z. C2 a) O 7- c CD@ co 0@ o m o @o co u'� aaCO � N » C ED o 6 o o 2 o E M a m m m °= in ° a@)co ace ¢ aOa cnn O F°- F°- FH z° .= ci aFri C Z - N CO 'I"U) CD N CO O) O N c") V N CO I"- UO O) N N 1.. J