The savings from not having to buy those Commie Masks should more than make up for your $13,000 energy bill.

Texas electric industry financial crisis to grow as more costs surface
[www.reuters.com]

(Reuters) - The Texas electricity market faces “insurmountable distress” as more gas and service bills come due, power industry officials said on Thursday at a hearing into financial fallout from the state’s February blackout.

High prices for emergency fuel and power saddled the companies that sell, transmit and generate electricity in the state with about $47 billion in storm-related costs. Those costs have led to one bankruptcy and put two retail providers out of business in the state.

Consumers facing bills for broken water pipes and food losses will see higher prices as costs get passed down through rate increases or fewer choices in providers, officials said. Future spending on weather defenses and grid linkages could add billions of dollars to the recovery. San Antonio’s city-owned utility expects about $1 billion in extra costs.

“The market is facing a financial crisis and it’s a very severe financial crisis,” Catherine Webking, executive director of an industry lobby group told state lawmakers at a hearing in Austin on Thursday. “You’ll see more and more financial distress that is insurmountable,” as bills for natural gas and financial collateral come due in coming weeks, she testified.
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On Wednesday, grid operator Electric Reliability Council of Texas (ERCOT) disclosed 12 energy companies and two municipal utilities were overdue on $2.21 billion for power and services during February.

Part of the deficit was covered by tapping internal grid accounts, but the rest eventually will be passed along to all grid users, straining those that have covered their initial bills, an official said.
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ERCOT normally uses a bid system to set prices but officials decided to set a $9,000 per megawatt hour charge that was about 450 times the price before the storm. It held at that $9,000 level for about 90 hours, leading to 10s of billions of dollars in charges over five days.



Edited 1 time(s). Last edit at 03/04/2021 06:47PM by Steve G..

“ Electric Reliability “ my butt.

I'm still trying to understand the genius idea of increasing the charge so high in an effort to reduce demand. It obviously didn't work at all.

It’s not like the providers of fuel for the generators had any increased costs, just increased demand. So in Texas in an emergency crisis, price gouging is perfectly legal. It’s a feature, not a bug.

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Saint Cloud, Minnesota, where the weather is wonderful even when it isn't.

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deckeda
I'm still trying to understand the genius idea of increasing the charge so high in an effort to reduce demand. It obviously didn't work at all.

It's almost like the system was set up such that competitive (looking for maximum profit) market forces were thought to be the optimum method for distributing electricity. Except maybe that doesn't take into account disasters where what is needed is cooperation rather than competition to effectively deal with the disaster. And such a system probably isn't even an optimum one when not in a disaster situation.

So who "made" all the money on this? The power producers?

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C(-)ris
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Throwback Thursday Signature:

profiteer: one who makes what is considered an unreasonable profit especially on the sale of essential goods during times of emergency

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DeusxMac
profiteer: one who makes what is considered an unreasonable profit especially on the sale of essential goods during times of emergency

But in this case someone else set the rate...someone who didn't directly profit from it. Very strange situation.

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C(-)ris
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Throwback Thursday Signature:

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C(-)ris
So who "made" all the money on this? The power producers?

No one - yet. The bills have gone out, but if all of the coops go bankrupt, there is nothing there, there.

Who made all the money? The unregulated generators who remained online and the natural gas suppliers. The transmission and distribution companies are more or less regulated.

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Saint Cloud, Minnesota, where the weather is wonderful even when it isn't.

So if the coop goes bankrupt, do people lose power until they can locate another provider?

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“No persons are more frequently wrong, than those who will not admit they are wrong.”
-- François de La Rochefoucauld

Growing older is mandatory. Growing up is optional.

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Ombligo
So if the coop goes bankrupt, do people lose power until they can locate another provider?

No, the coop files chapter 11. Operations continue until a judge rules on the exit from chapter 11. If there is no compromise, then the coop could close, in which case the customers would need a different supplier. But they would have all of this time to get an alternative in place.

Texas will be forced to overturn these bills, by correcting the rates that were illegally set in the first place.

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rj
AKA
Vreemac, Moth of the Future

One massive problem is a fairly high percentage of people have direct pay and already have had thousands of dollars deducted from their bank accounts. It's going to take years for people to claw back these gigantic overpayments in class action lawsuits. By the time they get a judgement, the producer will have gone through bankruptcy two or three times with the owners siphoning off assets each time. The customers will be lucky to get ten cents on the dollar back six years from now.

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In tha 360. MRF User Map

At least in Texas you can count on no investigations to see who was profiteering because there was no profiteering, just profiting, business as usual.

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Saint Cloud, Minnesota, where the weather is wonderful even when it isn't.