Certificate of Convenience and Necessity (CCN)
Chapter 13 of the Texas Water Code requires:
- A water utility providing retail water service to the potential for 15 or more customers for compensation to obtain a water CCN.
- A sewer utility providing retail sewer service to one or more customers for compensation to obtain a sewer CCN.
Prior to changing rates, an IOU must submit a rate application for review, approval, and/or modification by the PUC.
The challenge for IOUs is to design rates that cover their regular expenses and that allow for the opportunity to earn a reasonable rate of return on their investment without undercharging or overcharging customers.