Dominoes: Fallout From Texas Fiasco Just Getting Started

March 1, 2021

Reuters:

Texas’s largest and oldest electric power cooperative on Monday filed for bankruptcy protection in federal court in Houston, citing a disputed $1.8 billion bill from the state’s grid operator. 

Brazos Electric Power Cooperative Inc is one of dozens of electricity providers facing enormous charges for power and fees during a severe cold snap last month. The fallout threatens utilities and power marketers who collectively face billions of dollars in blackout-related charges, executives said. 

Unusually frigid temperatures knocked out nearly half of the state’s power plants in mid-February, leaving 4.3 million people without heat or light for days and bursting water pipes that damaged homes and businesses. Brazos and others that committed to provide power to the grid and could not, were required to buy replacement power at high rates. 

The state’s grid operator, Electric Reliability Council of Texas (ERCOT), on Friday said $2.1 billion in initial bills went unpaid, underscoring the financial stress on utilities and power marketers. More providers likely will reject the bills in coming days, executives said.

But not everyone was a loser.

I know you won’t believe this, but although the Texas legislature set up ERCOT rules to come down hard on single mothers in Dallas, electric coops, and some small cities, who are being swamped with unaffordable and extravagant power bills, some fat cats did very well – notably, Dallas Cowboys owner Jerry Jones got a huge bump when prices soared during the blackout. This article published at the height of the crisis.

Dallas Morning News:

The Frisco-based natural gas producer owned by Dallas billionaire Jerry Jones is cashing in on a surge in prices for the fuel as a brutal freeze grips the central U.S., leaving millions without power.

Comstock Resources Inc. has been able to sell gas from its Haynesville Shale wells in East Texas and northern Louisiana at premium prices since Thursday. As demand jumps amid the cold, gas at some regional hubs has soared past $1,000 per million British thermal units.

Gas from Comstock’s Haynesville wells was sold on the spot market for between $15 and $179 per thousand cubic feet, chief financial officer Roland Burns said Wednesday on an earnings call. That translates to between $15.55 and $186 per million British thermal units.

“This week is like hitting the jackpot with some of these incredible prices,” Burns said. “Frankly, we were able to sell at super premium prices for a material amount of production.”

Gas production has tumbled to a four-year low as a polar blast triggers blackouts across Texas and other central U.S. states, freezes liquids inside of pipes and forces wells to shut. Producers may take until March to fully restore supplies due to equipment damage, according to Charles Nevle, senior director for North American gas at IHS Markit.

UPDATE:

Damages? 195 BILLION on the LOW end. Below.

One Response to “Dominoes: Fallout From Texas Fiasco Just Getting Started”

  1. rhymeswithgoalie Says:

    Resolution: SYSTEM WORKS AS DESIGNED

    Bug report status: CLOSED


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