By statute, the city, as the regulatory authority, has a legal obligation to set rates that are just and reasonable. If the utility or any other party to the proceeding at the city is not satisfied with the rates set by the city, that aggrieved party may appeal the city’s rate ordinance to the Railroad Commission, where rates will be determined through a formal evidentiary rate case proceeding. The city has standing to participate in this appeal as a party. An appeal by any party of the rates set by Railroad Commission order would go to Travis County District Court.
The Railroad Commission monitors the overall quality of service and rates provided to a city by an investor owned utility. Through regular audits, the Railroad Commission assures, among other service issues, that the utility charges its customers the rates which have been formally authorized, and orders refunds if customers have been overcharged.