DALLAS (WBAP/KLIF News) – A report commissioned by the Texas Public Utility Council says ERCOT, the Electric Reliability Council of Texas, overcharged utility companies to the tune of $16 billion for two days after widespread power outages ended last month.
Potomac Economics, the independent market monitor for the PUC, has confirmed what some independent power companies have been claiming, that the overcharge was a mistake that threatens the companies’ viability. Some are passing along the extra charges to retail customers who have been wondering why their February electric bills were higher than usual despite long term power outages during the historic winter freeze.
The Texas Tribune explains that electricity is priced according to supply and demand in Texas. The wholesale price reached $9 thousand per kilowatt hour during the freeze but that price was kept in place for two days after the power crisis ended. That resulted in wholesale electric provider Griddy being banned from operating in the state after they passed along the entire charge to their customers. Other operators that provide power to most consumers on an annual average cost passed along some of the price spike to their customers.
Cathy Webking of the Texas Energy Association for Marketers told lawmakers during a Texas Senate Committee on Business and Commerce meeting Thursday that prices should be set back to what the market value would have been.
“There are more defaults imminent. Immediate action is required,” Webking said.
Brazos Electric has already filed bankruptcy after incurring $2.1 billion in combined charges. Other retail providers have complained to regulators about the error that forced them to scramble for power during the storm and are left to figure out how to stay in business.
A spokesperson for ERCOT declined to comment on the matter.