Linemen work on electric power distribution lines on East 7th Street in Austin on Tuesday, Sept. 30, 2025.
Jay Janner/Austin American-Statesman
When many Austinites get their utility bill this month, they might notice it’s higher than normal.
Rates for almost all of Austin’s municipal utilities are rising starting this month. The average bill for customers who utilize all of the city’s utilities will jump by $9.54 per month, an email sent out to Austin utility users said. The Austin City Council approved the new rates in August with the Fiscal Year 2026 budget.
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The Austin Energy portion of the average bill is set to decrease by about $5, but a typical Austin utility user will see increases of $8.71 for Austin Water, $2.90 for Austin Resource Recovery (trash), $8.04 for Austin Watershed Protection (drainage), $2.06 for the Transportation User Fee and 10 cents for the Code Compliance charge.
Austin Energy credits decreasing electricity costs for the cheaper electricity bills, but infrastructure costs are skyrocketing, utility spokesman Matt Mitchell said. Austin Energy’s base rate and fees will increase to cover the increased input costs, but the dropping cost of power itself will offset rising expenses to create an overall decrease.
“While inflation has increased by about 5% year-over-year, we’ve seen increases in electrical equipment and components go up between 100 and 200% in cost,” Mitchell said, adding that similar rate increases have impacted utilities across Texas.
Mitchell said Austin Energy is facing a budget shortfall next year and the 5% increase to the utility’s base rate is part of a 5-year plan to close the gap and recoup costs. The base rate factors in the costs to operate “the poles and trucks and wires and everything that it takes to run the utility,” he said.
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“We are a not-for-profit, cost-based utility. It’s incumbent upon us to recover the costs of being a public power entity,” Mitchell said.
Widespread billing error not related to rate hike
Mitchell said a recent billing error that resulted in thousands of customers receiving duplicate bills with discrepant balances was not related to rate changes and has since been resolved.
About 12,000 Austin utility customers received the errant bills in recent weeks, including Paul Williams, who lives in North Austin. Williams received his usual utility bill on Oct. 20. Then last week, he received a second bill showing he owed $753 dollars more. He was confused.
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“I got something, and it’s another bill, but I’m not supposed to be getting a bill,” Williams said. “It was identical in almost every respect to the first bill, except for the amount due.”
Then, on Tuesday, Williams received a letter from the city notifying him of the mistake.
“Two billing statements were recently mailed to you in error — one correct and one incorrect,” the letter reads. “We apologize for any confusion regarding these two bills.”
Mitchell said the mix-up was isolated and caused by a software test as Austin Energy — which handles billing for city utilities — upgrades its systems this month.
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“As part of that upgrade, we are running tests on different groups of customers,” Mitchell said. “For some reason, that particular instance — which we’ve not been able to duplicate after that, by the way — printed two sets of bills, causing understandable confusion.”
Mitchell said any customer that overpaid because of the issue will receive a bill credit.