As rapid growth projection for Denton continues, Denton Municipal Electric is seeking to expand its campus on Spencer Road by raising rates in 2025.
DME General Manager Antonio Puente Jr. went before City Council members last week to receive direction for either renovating the existing DME campus or expanding it, as city staff recommended.
Council members unanimously approved city staff’s recommendation to expand the DME campus at a cost that could reach $75 million.
“The current campus as it’s configured will certainly not meet our needs,” Puente told council members. “Past the next five years, we will be really out of space.”
The proposed expansion will also cause rates to increase 1.5% as part of a planned 12% rate increase over a four-year period beginning in 2025.
Part of the 12% rate increase, according to DME, is related to the $210 million that DME had to pay ERCOT for a week of electricity during Winter Storm Uri in 2021.
Currently, DME has 187 employees budgeted with only 175 in kind of a rotation but project that number to grow to 333 employees in 20 years. Puente said they are only utilizing about 81% of their current space, though some of those spaces don’t meet the recommendations for city facilities.
Puente said he hopes the expansion will bring in additional covered parking and better training facilities, as well as move inventory space, and other items he didn’t discuss at the meeting. He also said adding solar paneling to the roof would be part of the renovation plan.
They also plan to demolish some of the buildings and keep one for inventory space.
Puente pointed out that if they don’t expand now, it could be more expensive to do so in the future due to construction costs.
DME spokesperson Stuart Birdseye said they plan to finance it with certificates of obligation — also known as COs — or council-approved bonds instead of voter-approved ones. DME would then use revenue from the electric utility to pay it over a 30-year period.
Council member Chris Watts was the only council member to question why $75 million was needed and thought that a lower amount had previously been proposed. He pointed out that construction costs, like home prices, fluctuate.
Puente said that their internal assessment of what was needed was closer to $50 million but then they realized it might not be enough.
“$75 million more than adequately addresses all the needs that we have,” Puente said. “Once we have a design we can give council, there is an option to pull back on items [to save money].”
CHRISTIAN McPHATE can be reached at 940-220-4299 and cmcphate@dentonrc.com.