TX Senate scrambles to advance bill forcing ERCOT to reprice winter storm energy charges

Monday, March 15, 2021
TX Lt. Gov. Dan Patrick discusses ERCOT winter storm pricing bill
The move is the latest escalation in a growing divide between Lt. Gov. Da Patrick and Gov.Greg Abbott on the pricing issue and the leadership of the PUC.

AUSTIN, Texas -- Lt. Gov. Dan Patrick hastily convened a session of the Texas Senate on Monday as members suspended their own rules and took highly unusual steps to push through a bill that would force the state's utility regulator to reverse billions of dollars in charges for wholesale electricity during last month's winter storm.

Senate Bill 2142, sponsored by state Sen. Bryan Hughes, R-Mineola, had not even been filed when the day started Monday - and the full Senate hadn't been scheduled to convene. But the bill was quickly read on the Senate floor and referred to the Senate Jurisprudence Committee for a hearing on Monday morning. With no questions from members and no public comment, the committee passed the bill in a matter of minutes by a vote of 3-1. State Sen. Brandon Creighton, R-Conroe, was the lone no vote in the committee meeting.

The full Senate reconvened midday Monday and passed the measure by a vote of 27-3, with one member absent.

SEE ALSO: Texas lawmakers grill ERCOT and power companies

"These charges, if they're allowed to stand because of this mistake, will be excessive," Hughes said on the Senate floor. "But it's important: they're not just excessive, they're wrong, they're inaccurate, that's not the accurate price."

The bill states that the Texas Public Utility Commission "has all necessary authority" to order the Electric Reliability Council of Texas to reprice billions in charges after the state's power grid operator imposed a cap on electricity prices during the winter storm. The measure says the PUC "shall" order ERCOT to correct the pricing and gives the PUC a deadline of March 20 to act.

The filing of SB 2142 came after Friday's bill-filing deadline, but the Senate found a way around that rule in one of its bolder procedural moves Monday. The chamber brought back up its motion to adjourn Thursday and withdrew it, essentially going back in time on the legislative calendar and allowing Hughes to file his legislation before the Friday deadline.

SEE ALSO: Gov. Abbott names ERCOT $16 billion billing error correction as legislative emergency item

The move is the latest escalation in a growing divide between Patrick and Gov. Greg Abbott on the pricing issue and the leadership of the PUC. Patrick and most senators believe the prices should retroactively be brought down, and they have asked the PUC to do so. PUC and ERCOT leaders say the prices were intentionally left high to incentivize generators to send power during widespread outages. The PUC's chair has said he doesn't have authority to retroactively change the market price and has warned of unforeseen consequences of meddling in an electricity market that has already been settled.

State Sen. Joan Huffman, R-Houston, who chairs the committee that approved the bill earlier Monday, rebuffed the idea that repricing lies outside the PUC's authority.

"Though this is a non-amendatory legislation - which means we're not changing statutes and so-forth - it does have the force of law," she said. "So by us enacting this legislation, we are telling the PUC this is not illegal."

SEE ALSO: Will lawmakers really change the Texas grid?

Abbott had previously named an investigation into "billing errors" as an emergency item for the Legislature. An independent market monitor estimated that ERCOT overbilled power companies by $16 billion dollars, but the PUC refused to order ERCOT to adjust prices. The watchdog later revised its estimate of the overcharges to $4.2 billion, but that did not dampen Patrick's wrath.

The PUC's sole serving member, Arthur D'Andrea, told the state Senate last week that he does not have the authority to retroactively adjust prices. The other two spots on the PUC are vacant because their prior occupants resigned after the winter storm. Patrick has also called on D'Andrea to step down or for Abbott to remove him.

Abbott has continued to stand behind D'Andrea, writing in a Friday letter to Patrick that "the only entity that can authorize the solution you want is the legislature itself."

SEE ALSO: Texplainer: Why does Texas have its own power grid?

It's unclear how the bill will fare in the Texas House. While most senators have signaled an appetite to move quickly on the issue, members of the lower chamber have so far taken a more measured approach. If passed, it's unclear if Abbott would sign the bill.

"The Senate has acted," Patrick said after Monday's vote. "We are asking the governor to join us. And I think if he will say he'll sign this bill, it may help us get this bill through the House."

Earlier Monday, Abbott again put the onus of responding to winter storm fallout squarely on the Legislature.

"These are very complex issues and that's exactly why the Legislature is the right body to investigate this, to weed through all these complexities, and to make sure that if legislation is passed, it will satisfy the requirements of the Texas Constitution," Abbott said at a press conference in Houston.

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