(Reuters) – The Texas state Senate approved a bill on Monday to cut about $5.1 billion in disputed electricity and service fees levied on power marketers during a winter freeze that sent the state’s power market into financial crisis.
Last month’s cold snap pushed up normal electricity costs by nearly 10 times to about $47 billion. Those costs led three companies to seek bankruptcy and sparked a battle between lawmakers and the state’s power regulator over the handling of the crisis.
The Senate overwhelmingly approved a measure directing the Public Utility Commission chairman and grid operator Electric Reliability Commission of Texas (ERCOT) to correct 32 hours of emergency prices and roll back service fees. If approved by the Texas House of Representatives, it would go to the governor’s desk for his review.
Both legislative chambers are controlled by Republicans, and Governor Greg Abbott is also a Republican.
Lieutenant Governor Dan Patrick, who challenged the PUC to order the revisions, said after the vote that he had not spoken with the head of the House on Monday. Abbott is in favor of correcting pricing, said Patrick, a fellow Republican.
Abbott and the rest of the state’s Republican leadership have drawn fire for their handling of the weather crisis, which cut power to some 4.3 million in the state and contributed to the deaths of more than 56 people.
“There has been conflicting testimony throughout this process,” said the speaker of the House, Dade Phelan, signaling he would not be rushed. “There must be additional review on this consequential issue.”
A PUC spokesman declined to comment, citing the legislation. Chairman Arthur D’Andrea rejected prior Senate requests to order the change, saying he did not have the authority to act.
The Senate bill directed D’Andrea and ERCOT to “follow the law” and make requested rate and fee changes by Saturday, said Republican state Senator Bryan Hughes.
“Those 32 hours resulted in inaccurate and excessive charges to the tune of billions of dollars,” Hughes said.
The state’s market adviser said last week that ERCOT improperly held charges at $9,000 per megawatt hour, about 400 times the usual rate, and that its rules allowed for pricing errors to be corrected within 55 days.
On Monday, power marketer Griddy Energy LLC became the third Texas power provider to seek protection from creditors from the storm. It owes ERCOT $29 million and listed assets of less than $10 million, according to a filing with the U.S. Bankruptcy Court in Houston.
(Reporting by Gary McWilliams; Editing by Peter Cooney and Leslie Adler)