{"id":282832,"date":"2026-05-07T13:41:07","date_gmt":"2026-05-07T13:41:07","guid":{"rendered":"https:\/\/www.newsbeep.com\/us-tx\/282832\/"},"modified":"2026-05-07T13:41:07","modified_gmt":"2026-05-07T13:41:07","slug":"austin-considers-new-contract-with-texas-gas-service","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/us-tx\/282832\/","title":{"rendered":"Austin considers new contract with Texas Gas Service"},"content":{"rendered":"

The Austin City Council is scheduled to vote Thursday on a plan to continue partnering with Texas Gas Service for another next 10 years. That’s even though the council and residents have had plenty of complaints about the cost of the service being provided.<\/p>\n

Two years ago, renewing the contact felt less guaranteed. <\/p>\n

The relationship between the city and Texas Gas Service, the for-profit utility that provides the city with natural gas, was in a bad place<\/a>.<\/p>\n

Repeated rate hikes angered customers, and plans for another increase had City Council members suggesting they had reached a breaking point.<\/p>\n

They discussed finding another utility to work with when Austin\u2019s contract expired in 2026, or even buying out the local distribution system entirely and creating a public gas service.<\/p>\n

\u201cPlease, work with the city, our representatives and the outside stakeholders to meet the moment,\u201d Council Member Ryan Alter asked representatives for the utility in 2024, \u201cand not motivate us two years from now to really question whether this is a good partnership.\u201d<\/p>\n

Two years later, gas bills have kept going up<\/a>, public anger persists, but a new contract appears inevitable.<\/p>\n

The question is under what terms.<\/p>\n

\u201cThis [contract] is going to be well discussed before we reach the finish line. And we’ll hopefully have a product in place that protects customers and limits these rate increases,\u201d Alter said.<\/p>\n

The vote Thursday is over a proposed agreement drafted by city staff in negotiations with Texas Gas Service, that would allow the utility to continue as the the primary provider of gas for Austin homes and businesses.<\/p>\n

Under such agreements local governments rent out their land for a “franchise fee,\u201d and in return utilities become the sole gas service in that area. <\/p>\n

Ahead of the Thursday vote, some council members said earlier proposals to terminate the city\u2019s relationship with the utility quickly appeared unworkable.<\/p>\n

For example, buying out the utility and making it publicly owned \u201cwould be an incredibly expensive proposition,\u201d Council Member Marc Duchen told KUT News.<\/p>\n

While Duchen said he would prefer a publicly owned utility, he believed the cost of buying Texas Gas Service\u2019s local pipeline distribution system could run into the billions.<\/p>\n

\u201cI don’t know where that money comes from,\u201d he said.<\/p>\n

Alter said he did not think city staff had explored signing a franchise agreement with one of the other for-profit utilities in the region. But he thought such a process may have also become prohibitively expensive.<\/p>\n

\u201cSo instead, what we wanted to do was see how far we could push [Texas Gas Service] in this franchise agreement to get some of the stuff that we wanted to see,\u201d he said. \u201cAnd I’d say we’ve gotten some of that.\u201d<\/p>\n

He pointed to increased bill assistance for low income bill ratepayers, improved leak detection reporting and greater oversight on how the gas service is spending money on capital projects as significant improvements to the contract.<\/p>\n

Some still hope for better deal<\/p>\n

While a 10 year franchise renewal with the gas service appears to be a done deal, some ratepayer advocates hope City Council will postpone voting on the proposed agreement.<\/p>\n

They believe further negotiations between the city and the utility may yield more favorable terms.<\/p>\n

A list of recommendations<\/a> sent to City Council members by Austin\u2019s Resource Management Commission last week outlined ways commissioners thought the contract could be improved.<\/p>\n

Among other things, they urged City Council to demand more money for low income bill assistance, a more ambitious conservation program, and major changes to the way Texas Gas Services finances its own system growth.<\/p>\n

\u201cThe idea is the existing gas customers are subsidizing the company’s expansion into new areas,” Commissioner Raphael Swartz said. \u201cWe are asking here that the company does in fact collect full contribution [from developers] for new hookup and development.\u201d <\/p>\n

Duchen said he agreed with many of those recommendations.<\/p>\n

On Monday representatives from Duchen’s office said he would support postponing the vote if enough of council agreed.<\/p>\n

Alter said he was considering it. But he worried the move could alienate the gas utility and result in a worse deal than city staff already negotiated.<\/p>\n

\u201cDid we get as far as we wanted? No.\u201d Alter said. \u201cBut we’ve got things in this franchise agreement that you won’t find anywhere else in the state of Texas, which is a pretty meaningful win.\u201d<\/p>\n

In a statement emailed to KUT News, Texas Gas Service said: \u201cTexas Gas Service believes the current franchise framework provides a strong foundation for delivering safe, reliable service to Austin residents.\u201d<\/p>\n

Regardless of what happens Thursday, Alter said he believes there will be more time for City Council and the public to weigh in.<\/p>\n

Under city rules, franchise ordinances require three readings at council and cannot be finalized until 30 days after the initial vote.<\/p>\n","protected":false},"excerpt":{"rendered":"The Austin City Council is scheduled to vote Thursday on a plan to continue partnering with Texas Gas…\n","protected":false},"author":2,"featured_media":282833,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[132,134,133,4566,3759,104161,451,11310,29681],"class_list":["post-282832","post","type-post","status-publish","format-standard","has-post-thumbnail","category-austin","tag-austin","tag-austin-headlines","tag-austin-news","tag-bills","tag-city-of-austin","tag-cost-of-energy","tag-energy","tag-natural-gas","tag-texas-gas-service"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/us-tx\/wp-json\/wp\/v2\/posts\/282832","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/us-tx\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/us-tx\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-tx\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-tx\/wp-json\/wp\/v2\/comments?post=282832"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/us-tx\/wp-json\/wp\/v2\/posts\/282832\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-tx\/wp-json\/wp\/v2\/media\/282833"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/us-tx\/wp-json\/wp\/v2\/media?parent=282832"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-tx\/wp-json\/wp\/v2\/categories?post=282832"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-tx\/wp-json\/wp\/v2\/tags?post=282832"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}