Texas Legislature Should Help Taxpayers Weather Storm


Total bill: $ 800 million.

This is what CPS Energy, the largest state-owned utility, owes natural gas suppliers, thanks to a 1,600% price increase during winter storm Uri.

On April 26, Enterprise Products Partners announced that it was suing CPS Energy for an unpaid bill totaling $ 99.7 million. Three days later, CPS amended its lawsuit against the Electric Reliability Council of Texas “to protect customers from excessive, illegitimate and illegal electricity prices” and requested a temporary restraining order to further protect its customers against ERCOT’s attempts to transmit “illicit”. charges.

The two lawsuits came just days after CPS Energy announced that 10% of its customers were late enough on their bills to risk having their electricity cut when the utility restarts disconnections. As of March 31, the utility owed about $ 100 million in unpaid bills.

Since the freeze, a wave of electricity providers in Texas have declared bankruptcy, and several more are on the brink of collapse. Unless members move quickly to embrace full, market-wide securitization, debt collectors will quickly come after electric utilities and taxpayers, further hampering Texas’ economic recovery.

When temperatures dropped during the February frost and the generators were taken offline, the Texas Utilities Commission, or PUC, asked ERCOT to set prices at the maximum amount to entice generators to switch on. online. None did. Instead, lives were lost and Texans suffered. When power returned, heads of state were given the opportunity to reset the price during the blackout period, essentially wiping out the debt. While Texas Lieutenant Governor Dan Patrick and the Texas Senate supported the price change, the House took no action.

Energy retailers in Texas owe $ 46 billion. It is too late to get rid of this debt, but it is not too late for the Legislature to cushion the economic blow.

To ease the debt burden on taxpayers, the legislator is considering a mechanism called securitization. Essentially, the state government would create an organization to finance emergency debt and provide longer-term, lower-cost loans, which would allow it to be repaid over decades.

Senate Bill 2227, introduced by State Senate Speaker Bryan Hughes, R-Mineola, wisely provides for large-scale securitization. By quickly passing this bill, the legislature can protect taxpayers, businesses and the economy from sky-high energy costs.

If the Legislature does not act, taxpayers statewide will see their energy bills increase by hundreds over the next several months. And it’s not just individuals; commercial real estate companies have millions of additional costs that will be passed on to customers in the next billing cycle. Restaurants, small businesses, and even manufacturers will be forced to pay out of pocket or go to bed due to rising costs.

Like CPS Energy, Texas suppliers have felt the crippling impact of COVID-19 on the Texas economy. Passing on billions of unpaid bills to taxpayers in the wake of a pandemic one in a century would be the last straw for many Texas businesses that have clung to threads. This would ensure Texans – especially low and middle income consumers – will pay their Uri bills for years to come.

To avoid further lawsuits and save the Texas economy, our elected officials must pass a full-scale securitization bill before it’s too late.

Brandon Young is a member of Texans for Fair Energy Billing, a statewide consumer coalition, and CEO of Payless Power, an energy company.

Leave A Reply

Your email address will not be published.