Texas governor, Greg Abbott, said on Tuesday he has called out to correct inaccurate and excessive charges of the Electric Reliability Council of Texas (ERCOT), after the cold snap in the state. The matter is already a concern of the state legislature.
Firstly, Abbott send the message for immediate consideration of the Senate and the House of Representatives of the state Legislature; saying they have to correct “any billing errors, including any inaccurate excessive charges and any issues regarding ancillary service prices.”
Secondly, Abbott’s declaration came just a day after the state Lieutenant Governor Dan Patrick called ERCOT to correct its $16 billion pricing error.
Thirdly, as we reported previously; Potomac Economics, an independent market monitor, published a report in which said ERCOT have made a $16 billion mistake in pricing, as it kept prices intervened for more than a day.
Moreover, Potomac said on a filling ERCOT should have immediately ended the prices intervention. Nevertheless, ERCOT kept prices at volume of lost load (VOLL) high; “by inflating the Real-Time On-Line Reliability Deployment Price Adder for an additional 32 hours; through the morning of February 19.”
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Companies affected after Texas storm and ERCOT’s pricing error
Soon after the report by Potomac, ERCOT’s board ousted its chief executive Bill Magness; increasing their vacancies, after more than seven directors resigned to the grid operator. In fact, after Potomac’s report, Moody’s, the rating agency, downgraded the Texas grid operator from an A1 to an Aa3. Also, company’s outlook got a “negative” label.
In addition, the winter storm provoked not only an energy crisis, but left millions in the dark, with no electricity or gas supply. Around 22 people died. And neighbor countries, like Mexico, also faced supply disruptions.
Indeed, the energy crisis escalated to the point that the Federal Energy Regulatory Commission (FERC) initiated an investigation to see if there were any frauds committed; or any artificial intervention of the prices.
Moreover, some companies got seriously affected by the boost in prices, like Just Energy. A Toronto-based energy retailed, early in February said it was under risk of not being able to keep as a going concern.
However, thus Tuesday, the company said it sought financial relief from the Canadian and American government; and that it had secured its financial future, with no risk to its customers.
