Appeals court says state agency set electricity prices too high during 2021 winter storm
The Austin-based court found that the utility commission’s actions resulted in billions of dollars in overbilling charges. It is unclear whether the ruling will affect consumers.
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Austin (texas tribune) — A Texas appeals court shocked the electric world by ruling on Friday that the utility commission overstepped its authority to raise electricity rates by as much as $9,000 a megawatt-hour during a deadly February 2021 winter storm.
The commission that oversees electricity in Texas set prices so high on Feb. 15 and Feb. 16 that it was trying to tell the market that more generation was desperately needed. The ruling explained that its leadership believed that a financial instrument designed to adjust the cost of electricity had failed as generators went offline and grid operators cut power to homes and businesses.
Electricity prices in Texas are volatile; they rise when demand is high to incentivize more production and prevent grid overload.But the state’s electricity market monitor said after the storm that Texas Overcharging retail electricity suppliers by $16 billion They then pass power to residents and businesses across the state.
Power company Luminant appealed its pricing decision within a month of the storm. It argued, among other things, that the commission exceeded its authority to set the price at a maximum price. The Austin-based Third Court of Appeals agreed in a ruling issued Friday. But the ramifications of its decision were unclear, as the court sent the case back for retrial.
The Public Utilities Commission declined to comment.
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this Article originally appeared in The Texas Tribune at www.texastribune.org. The Texas Tribune is a nonprofit, nonpartisan media organization that informs and interacts with Texans on public policy, politics, government and statewide issues.
