Former Texas power grid chief says governor ordered him to overcharge for electricity during winter storm

Former Texas power grid chief says governor ordered him to overcharge for electricity during winter storm
Gov. Greg Abbott of Texas

The former chief of the Texas power grid testified under oath on Wednesday that Republican Governor Greg Abbott ordered him to charge residents the maximum rates for energy during the massive winter storm that knocked out electricity to millions of customers in 2021.

Bill Magness, the ex-chief executive officer of the Electric Reliability Council of Texas (ERCOT), told a court that former Public Utility Commission Chairman DeAnn Walker, at the behest of Abbot, instructed him “to do whatever necessary to prevent further rotating blackouts that left millions of Texans without power,” The Houston Chronicle has reported.

“She told me the governor had conveyed to her if we emerged from rotating outages it was imperative they not resume,” Magness recalled. “We needed to do what we needed to do to make it happen.”

Instead of easing the strain, however, the astronomical $9,000 per megawatt-hour surcharge led to a staggering $1.9 billion in outstanding bills being owed to utility providers, forcing one of them into bankruptcy.

“Magness's decision to keep power prices at the maximum cap for more than 24 hours after conditions on the power grid began to improve is now at the center of a bankruptcy trial waged by the Waco-based electric co-op Brazos Electric,” the Chronicle explained.

“It did nothing at all to cause more generation to come online,” Lino Mendiola, an attorney representing Brazos, revealed to the Chronicle. “It was an attempted remedy that didn’t solve any of the problems caused by the winter storm.”

The Chronicle noted that “the original order to raise power prices to the cap was made by the Public Utility Commission on Feb. 15, to try to get power plants back online and encourage large power users like factories and petrochemical plants to stay offline. ERCOT elected to keep prices at the cap until Feb. 19, a decision that the Texas Independent Market Monitor criticized in a report last year as having, ‘exceeded the mandate of the Commission.’”

And although he has in the past defended the move Magness “explained in detail how Walker had come to ERCOT's operations center in the middle of the crisis and relayed to him Abbott's demand that rotating blackouts come to an end" during the bankruptcy proceedings on Tuesday and Wednesday, according to the Chronicle.

Magness also “described how after so many hours of power outages, there was a risk that Texas's problems could cascade, explaining how water plants that had been relying on backup generation would have soon run out of fuel if rotating blackouts resumed,” per the Chronicle.

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