Gov. Abbott to Blame for Billions in High Electric Prices, Former Grid CEO Says

It’s Texas Governor Greg Abbott’s fault that energy costs in the course of the state’s lethal 2021 winter storm shot by way of the roof even because the disaster was ending, a former prime official with the state’s energy grid testified Wednesday. This declare contradicts the official line from the governor’s workplace, which has maintained that Abbott had nothing to do with the choice that value ratepayers billions of {dollars}.

Bill Magness, the previous President and CEO of the Electric Reliability Council of Texas (ERCOT), which runs the state’s energy grid, took the stand this week in chapter courtroom as a part of a listening to introduced by Brazos Electric, an electrical co-op based mostly in Waco. At the middle of the mess is a key choice made by ERCOT throughout final yr’s historic winter storm to maintain electrical energy costs excessive, at the same time as outages had been ending throughout the state, for greater than a day after issues began to return to regular.

That transfer finally value energy suppliers an additional $16 billion in prices; Brazos, for its half, is claiming that the choice value it $1.9 billion alone, which dragged it out of business. (Power firms, after all, aren’t the one ones who acquired the quick finish of the stick on this transfer. Some prospects additionally noticed astronomical energy payments following the storm.)

After final yr’s lethal storm left tens of millions of Texans with out warmth for days and uncovered huge, underlying issues with the state’s electrical grid, ERCOT cleaned home. While a number of the group’s officers went gracefully, Magness dug in, defending ERCOT’s choice to selectively minimize energy for some prospects in the course of the chilly snap earlier than finally being given the boot by the board.

But Magness’s testimony on Wednesday shed new gentle on how these fated days could have really gone down. During the ultimate days of the storm in mid-February, energy costs had been capped at greater than 150 instances regular at $9,000 per megawatt hour. Magness is now saying that the choice to maintain these charges at the same time as energy crops had been coming again on-line got here from the governor. He testified that the now former Public Utility Commission Chairwoman instructed him that “the governor had conveyed to her if we emerged from rotating outages it was imperative they not resume. We needed to do what we needed to do to make it happen.”

The choice to maintain costs excessive within the ultimate days of the disaster, Magness stated, was an try by the PUC to encourage energy crops to return again on-line and to maintain large energy customers like industrial amenities offline, with a purpose to preserve emergency energy reserves. However, the transfer to maintain costs so excessive for therefore lengthy and the big ensuing value to the system has been extensively criticized by watchdogs as ill-advised and exceeding the scope of the Commission’s energy—and, it appears, nobody desires to step as much as the plate to take the blame. (By the best way, large out-of-state banks, together with Bank of America, Morgan Stanley, and Goldman Sachs did revenue from the inflated costs, and had been caught on a recorded name final yr with a former Public Utility Commission worker who assured them he was working to assist them maintain their income.)

At a gathering final yr on ERCOT’s function within the mess, a spokesperson for Abbott stated the governor’s workplace had nothing to do with the decision—regardless of an aide from Abbott’s workplace being at ERCOT headquarters on the time the choice to maintain costs excessive was made.

“As Texans would expect, Governor Abbott instructed everyone involved that they must do what was needed to keep the power on and to prevent the loss of life,” a spokesperson for Abbott instructed the Houston Chronicle Wednesday. “This is the same instruction Governor Abbott gave to the PUC and ERCOT (during a cold snap) earlier this year: Do what needs to be done to keep the power on.”

Democratic candidate Beto O’Rourke, an opponent for Abbott in Texas’ upcoming gubernatorial election has lengthy been campaigning on the federal government’s failures in the course of the blackout. O’Rourke released several tweets blasting Abbott’s involvement within the choice. Given how simply Abbott threw round falsehoods about wind vitality’s function within the blackouts and has constantly overpromised on the grid’s solidity, we wouldn’t be stunned if he was fudging the reality in terms of this too.