Dan Patrick pressures Greg Abbott to change the price of electricity in Texas

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Lt. Gov. Dan Patrick called Thursday that Gov. Greg Abbott take executive action to reverse billions of dollars in wholesale electricity charges during last month’s deadly winter storm after the Texas House of Representatives suspended the week without broach the subject.

“The Governor of Texas is a very powerful person,” Patrick said at a news conference on Capitol Hill, stepping up his one-day campaign for Abbott to intervene. “He can do whatever he wants”.

After the Senate moved at breakneck speed Monday to pass Senate Bill 2142, storm-driven electricity price modification legislation, the House indicated it would not act on the proposal. Instead, the lower house emphasized that it planned to take a more deliberative approach. And, while the bill was referred to a House committee Thursday morning, the House relented until Monday afternoon.

The bill would have forced the state’s power grid operator, the Texas Electrical Reliability Council, to reverse approximately $ 4.2 billion in charges after an independent market monitor found that ERCOT artificially inflated prices. and overbilled energy companies by $ 16 billion. And the legislation included a March 20 deadline for the Public Utilities Commission, which oversees ERCOT, to take action to reverse those charges.

Patrick said Thursday that Abbott could, using its emergency powers, order the commission to tell ERCOT to correct the charges or that the charges are under investigation, which, according to the lieutenant governor, will extend the timeframe.

“The House said they wanted more time, that would give them more time,” Patrick said.

Patrick told reporters he met “extensively” Thursday with House Speaker Dade Phelan, R-Beaumont, and they had a “good discussion.” Referring to members of the House, Patrick said he thought the Senate “could get there faster than they could” – passing an electricity price change bill – “because we can act quickly” by suspending the rules in the Senate. .

After the Senate passed the price review legislation, Phelan had expressed skepticism toward reversing such charges, saying in a statement that doing so “based on disagreement with PUC and ERCOT management decisions is extraordinary government intervention in the free market. ” Phelan also said there was “no error” in the operator’s pricing, in contrast to Patrick, who has repeatedly referred to those billions of dollars in charges as an error.

Despite Patrick’s pleas, Abbott still had not clearly taken sides in the debate as of Thursday night. In response to Patrick’s press conference, an Abbott spokesperson released a statement that did not address Governor Patrick’s latest requests, but reiterated the emergency items Abbott announced after the storm, including “inaccurate and excessive charges.” The statement also signaled a movement in the House on Abbott’s emergency articles, noting that a lower house committee was expected to vote Thursday night on multiple proposals related to the power grid.

The House State Affairs Committee did just that Thursday, passing a series of bills that would address power grid vulnerabilities and change ERCOT’s governance structure, among other things. But lawmakers admitted that those bills were still in the works. And none of them addressed ERCOT’s billing dispute.

While the statements suggest that Abbott is more aligned with the House, it has yet to reject the Senate bill and has avoided explicitly endorsing either house’s strategy. When asked on Wednesday if he agreed with the House or Senate approach to the electricity price review, Abbott said he “had already made several comments on it.”

It wasn’t entirely clear what previous comments Abbott was referring to, but on Monday, as the Senate prepared to swiftly pass SB 2142, Abbott appeared to urge a more deliberative approach, and it was left to the Legislature.

Texas is currently under multiple disaster declarations, including one Abbott issued on February 12 in response to the winter storm. For more than a year, the state has also been under a disaster declaration due to the coronavirus pandemic, and Abbott has received criticism from some in his own party about how he has exercised his emergency powers during that time.

Winter weather last month caused power failures of all types, creating an electricity crisis during which nearly 4.5 million Texas homes and businesses were without power. For days, ERCOT charged the maximum allowed amount for wholesale electricity – $ 9,000 per megawatt-hour – in order to incentivize generators to send power to the grid.

It’s still unclear how much the current billing dispute will affect average Texans. At least some of the additional costs incurred by retail electricity providers would likely be passed on to customers through rate increases. But the impact varies by company, and those who sent power to the grid while rates were inflated can lose money if ERCOT reprices.

Abbott said the Legislature needed to look into the issue and “remove all these complexities,” specifically if the price change conflicted with two sections of the Texas Constitution.

On Wednesday, however, Attorney General Ken Paxton issued an opinion that said the PUC has “complete authority” to change prices and downplayed the exact same constitutional issues that Abbott raised.

“A court would likely find that such corrective action by the Public Utilities Commission” would not conflict with the state constitution “as long as such regulatory action promotes an overriding public interest,” Paxton wrote in the non-binding opinion, which Patrick requested. two days before.

Patrick also scored a victory Tuesday night, when Abbott announced the resignation of Arthur D’Andrea, who had recently been appointed by the governor to serve as commission chairman. The governor said he had asked for D’Andrea’s resignation, which is effective with the appointment of a successor. Abbott said it would name D’Andrea’s replacement “in the next few days,” an appointment that, if made during the 2021 legislative session, will need to be confirmed by the Senate led by Patrick.

Abbott, whose office had defended D’Andrea on Friday, did not provide a reason why it had requested D’Andrea’s resignation. But the news came hours after Texas Monthly published an article Tuesday saying D’Andrea had told out-of-state investors in a call that he would work to shed “the weight of the commission” behind stopping the review calls. of prices.

At a press conference in Dallas the next day, Abbott did not offer many new details when asked why he had wanted D’Andrea to resign.

“We want to make sure we show the vision to our fellow Texans that we are charting a fresh new course for the Public Utilities Commission, and the action I took is one of many steps that will be taken to achieve those goals,” said Abbott.

Despite the House’s difference in focus, which includes a package of proposals that the House State Affairs Committee was considering Thursday, some House lawmakers indicated this week that they would have at least liked to have a conversation about the price modification.

While the House was in session Wednesday, State Representative Trey Martinez Fischer, D-San Antonio, asked Phelan if the House could meet as a committee of the whole the next day to consider SB 2142. Phelan said he would not recognize Martínez Fischer for such a move.

And when asked at Thursday’s press conference if he had spoken to members of the House who were sympathetic to his position on the price change, Patrick said, “Yes, I’ll leave it at that.”

Disclosure: Texas Monthly has been a financial sponsor of The Texas Tribune, a non-profit, non-partisan news organization that is funded in part by donations from members, foundations, and corporate sponsors. Financial supporters play no role in Tribune journalism. Find a complete list of them here.


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