Item 7- RCA: Repealing City Code 15-9-5 (Large Loads) — original pdf

Backup

Posting Language ..Title Approve an ordinance repealing Section 15-9-5 of City Code relating to deposit or bond for infrastructure improvements. Funding: This item has no fiscal impact. ..De Lead Department Austin Energy Fiscal Note This item has no fiscal impact. Prior Council Action: For More Information: Amy Everhart, Director, Local Governmental Relations (512) 322-6087; Stephanie Koudelka, Acting Senior Vice President and Chief Financial Officer (512) 322-6373 Council Committee, Boards and Commission Action: February 9, 2026- To be reviewed by the Electric Utility Commission. Additional Backup Information: Section 15-9-5 of City Code, adopted in 2003, requires the director of the Electric Utility to assess a deposit or impose a bond requirement for 50% of the cost of infrastructure improvements or additions for loads over four megawatts, in addition to any contribution in aid of construction (CIAC) payment required by a service contract. Requiring only partial and not full recovery of costs is inconsistent with current policy. In 2014, Council adopted Resolution 20140612-057, which requires full cost recovery of line extensions from the requesting customer. Recent growth in large electric load development has raised concerns across the industry about cost allocation for infrastructure improvements and additions. Electric industry practice for large load customers is to impose a requirement for 100% of the cost of infrastructure improvements or additions. For example, the Texas Legislature adopted Senate Bill 6 in 2025 providing that large loads greater than 75 megawatts pay for the infrastructure necessary to serve them. Repealing this Code provision ensures consistency with current policy and allows Austin Energy to require 100% cost recovery. This repeal does not impact the utility’s authority to assess a deposit or other security as necessary. This action protects existing customers by requiring all customers, including large load customers, to pay for the costs to serve them. Item 7