Oncor Seeks $834 Million Rate Hike in Texas

The company is also pursuing interim rate relief as regulators begin reviewing its request, with a final decision expected by early 2026.

June 27, 2025

Oncor Proposes 13% Revenue Boost to Fund Self-Insurance and Capital Structure Changes

Oncor is making a move to reset its rate structure. On June 26, the company announced plans to file a comprehensive base rate review with the Public Utility Commission of Texas (PUCT) and 210 cities across its service area. If approved, the request would increase Oncor’s annual revenue requirement by $834 million—about 13% over current adjusted levels.

That proposed increase is designed to keep pace with the rising cost of doing business. Oncor is asking regulators to approve a revised capital structure with a higher equity ratio—moving from 42.5% equity to 45%. It’s also targeting a return on equity of 10.55%, up from the current 9.7%, along with a modest rise in its authorized cost of debt.

What’s behind the numbers?

Four core drivers are fueling the rate request:

• $230 million increase to the annual self-insurance reserve to align with recent storm-related losses.


• $200 million tied to changes in capital structure, return on equity, and average depreciation rates.


• $170 million in higher operating costs, including:
  
  
  
  • $50 million from increased insurance premiums, and
  
  
  • A net $40 million in other operating costs—mostly labor and contractor-related.
  
  
  
  


• $150 million in unrecovered self-insurance losses from 2022 through 2024.

Next Steps: Interim Relief and Timeline

While the formal review process unfolds, Oncor isn’t standing still. It plans to file for interim rate relief in the coming weeks—an option allowed under PUCT rules. That request will leave out some of the more complex adjustments, including capital structure changes and increased self-insurance accruals.

If all parties agree, interim relief can be granted quickly. If not, the administrative law judge overseeing the case can approve it for good cause. Once in place, interim rates would be subject to adjustment depending on the outcome of the final ruling.

The PUCT has 185 days to review the full proposal, so a final decision is expected by the end of 2025 or early 2026. Oncor is preparing for all scenarios, knowing that both regulators and stakeholders will closely examine every part of its request.

This filing is about setting up the company to handle rising costs, storm risks, and long-term infrastructure demands. Oncor is pushing forward with a plan that aims to balance financial resilience with the evolving needs of its Texas service territory.