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The
storm temporarily knocked out up to half the state's generating
plants last month, triggering outages that killed dozens and
pushing up power prices to 10 times the normal rate. About $47
billion in higher costs is threatening the companies that sell,
transmit or generate electricity in the state. Consumers will
see higher prices as the costs are passed along.
Power marketers that sell electricity want the state's Public
Utility Commission to reduce, suspend or rescind fees for
ancillary services such as standby power that they are required
to pay, though in some cases the services were not provided
during the blackout. According to one power marketer, those fees
ballooned from $37,000 to $19 million for the week of the storm.
The Independent PUC adviser Carrie Bivens this week recommended
cuts that could shave about $2 billion from service fees, though
she provided no estimate of the total.
Rules designed to encourage more power during emergencies pushed
wholesale prices to $9,000 per megawatt hour (mwh) and led to
$25,000 per mwh service fees. The average U.S. home uses about
900 kilowatt hours per month.
One of Bivens' recommendations would shave two-thirds off the
fees charged marketers for the routine services. Another would
reverse the fees paid to the generators that failed to provide
services during the storm. If left in place, the fees could
force out a quarter of the state's about 100 providers and
concentrate up to 80% of the market among three large utilities.
"There could be a number of retail service providers who aren't
able to remain in business if ERCOT does not relent on the
demand for payment," said Catherine Webking, an attorney who
represents companies seeking fee cuts.
It is unclear how the PUC will act. It supervises grid operator
Electric Reliability Council of Texas (ERCOT), which acts as a
clearinghouse, collecting money from electricity sellers and
paying those that produce the electrons. It is facing a $2.46
billion shortfall from companies that have not paid their bills.
ERCOT on Monday said it would begin naming businesses that have
failed to pay and disclose the amounts each owed.
ERCOT's plan to name and shame scofflaws "is perfectly fair
game," said Patrick Woodson, chief executive of ATG Clean
Energy, who said his company is unscathed. However, he added: "I
hope they will apply the same standards to identifying the
market participants who made massive profits during this
disaster."
The crisis claimed its first victim Monday when Brazos Electric
Power Cooperative Inc, whose members provide power to about
660,000 in the state, filed for bankruptcy after receiving bills
for $2.1 billion from ERCOT.
(Reporting by Gary McWilliams; Editing by Leslie Adler)
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