04-A TXU Gas Rate Case Summary - Laserfiche WebLink

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TARIFF IMPROVEMENTS We are requesting, in addition to a rate increase, a number of other changes to our tariff. The two most important are to provide a capital investment adjustment factor (CIAF) and we are also seeking to revise the gas cost recovery mechanism. Both of these proposals are meant to reduce furore rate case expenses and to provide more timely recovery of costs, thus reducing regulatory expenses and improving the Company's financial future. As our service area grows and our facilities continue to age, we expect that our investment in the system will continue to exceed depreciation for the foreseeable future. This will make it highly likely that we will have to continue to file rote cases on a regular basis if the CIAF is not approved. We are also proposing changes in the gas cost recovery procedures, which will limit future rate- case expenses while enhancing the TRC's and City's ability to monitor and review those costs. Rate cases are expensive for all concerned, especially for our ratepayers. A broad consensus exists that steps should be taken to limit those costs. We believe our proposals will accomplish that end. CONCLUSION TX'U Gas is proud of its achievements since 1909, and especially in the last five years. We have maintained a safe and reliable gas system through the hard work of our employees and the investment of a tremendous amount of capital. Reducing our field operating expenses has not been easy but we have done it. Through our rate activities of the last few years we have gained a better understanding of what the Cities and TRC want to see in a rate filing. While areas of disagreement may remain over policy, we are confident that our hard work in preparing this package will allow the process to focus on those policy differences. We expect the result of this effort to produce a fair treatment of our request that will allow us to continue to provide safe and reliable service to our customers. Page 4 of 4