More than 78 years ago, San Antonio’s leaders had the foresight to invest $34 million to purchase a local and privately owned electric and gas utility company to take control of our city’s energy future. Today, that company is known as CPS Energy. Rather than paying huge dividends to private investors who may not be beholden to this community, CPS Energy is a city-owned utility with an established revenue-sharing agreement that has to date infused more than $8 billion into the city’s general fund. The phenomenal success of this arrangement is what I like to call the “CPS Energy Miracle.”
As a former chair and current trustee of the CPS Energy board, I’m known for my position that the utility should always operate using proven business principles. As with any reputable and successful business, we must balance what our customers want and what is fair for our owners. In this case, our customers and owners are one and the same, and we work hard to achieve the right balance.
The CPS Energy team of 3,100 dedicated employees, led expertly by President and CEO Paula Gold-Williams, has continued putting people first to serve our city. Our customers consistently tell us reliability and affordability are by far their most important energy considerations. CPS Energy ranks in the top 6% for reliability among 2,000 American Public Power Association companies. As to affordability, our standard, non-promotional bills are among the lowest in the state. In fact, our customers pay some of the lowest utility bills of any major city in the country. Driven by our leadership team’s careful management and hard work to keep budgets tight and costs under control, we have been able to achieve an outstanding level of return on the city’s investment without – for the past six years – the need to raise established customer rates, and with only obtaining one small increase of 4.25% in the past 10 years. I suspect that very few businesses of any type can match this record.
We are also thoughtful and objective environmental leaders. We have invested in renewable energy for 20 years, and we are proud to be an industry leader in renewables. We are No. 1 in Texas and No. 5 in the country for solar, and No. 2 in Texas for wind capacity. Currently, 22% of our energy generation capacity comes from renewables, and our 1,614 megawatts of renewable capacity is among the highest in the country.
Through the Flexible Path strategy, we continue working toward a goal of net carbon neutrality by 2050. This aligns with the City of San Antonio’s Climate Action and Adaptation Plan (CAAP), which the CPS Energy board of trustees endorsed in 2019. Some would like to see us move faster, but we must maintain reliability and affordability while moving as quickly as proven technology allows to meet our environmental responsibility goals. Others have tried to move too rapidly and without proper planning, which has proven to be a huge mistake – the latest example being the state of California.
Our owners (the citizens of San Antonio) and our customers should be extremely proud of CPS Energy for delivering exactly what they want, world-class affordability and reliability. CPS Energy also delivers an incredible benefit that is known to only a few people. The company shares its gross revenue with the City of San Antonio, and in the latest fiscal year, this totaled over $345 million, meaning almost $1 million every day is transferred from CPS Energy to the city. This contribution helps keep property taxes low. If our community wanted to keep the city’s budget at the same level without the CPS Energy contribution, San Antonio would need to almost double property taxes or find another way to raise approximately 30% of the city’s general fund.
CPS Energy has helped make San Antonio an attractive and stable place to live and do business, which creates jobs and drives economic growth. The company operates in the best interest of its customers, employees, this community, and our future.
In summary, we are extremely fortunate that CPS Energy provides (1) outstanding affordability, (2) excellent reliability, and (3) at the same time funding of approximately 30% of the city’s general fund. Thus, “The CPS Energy Miracle.”