Connect with us

Hi, what are you looking for?

Stock

Exclusive: Texas power regulator, under pressure to roll back storm prices, huddles with Wall Street

Stock Markets35 minutes ago (Mar 10, 2021 01:35PM ET)

2/2

(C) Reuters. FILE PHOTO: Winter weather caused electricity blackouts in Houston

2/2

By Gary McWilliams

HOUSTON (Reuters) – The chairman of the Public Utility Commission of Texas huddled with Bank of America (NYSE:BAC) utility analysts on Tuesday as pressure mounted on him to reverse about $16 billion in emergency power pricing that would hurt power plant operators.

The meeting came two days before PUC Chairman Arthur D’Andrea was due to rule on rescinding billions of dollars in charges levied on electricity marketers. If he reverses those charges, it would help retail marketers and hurt traders and power generators that stand to collect the money.

The state’s power grid operator raised power prices sharply during a February freeze to induce more power during a blackout. However, prices were left at about 450 times their usual level long after the emergency passed, moves that benefited traders and generators.

Bank of America has market analysis and power and gas trading arms deeply tied to the Texas crisis. Securities analysts on the call with D’Andrea give investors advice in whether to purchase securities in publicly traded utilities that could lose from any repricing.

D’Andrea was not available for comment. PUC spokesman Andrew Barlow rejected any conflict of interest in the meeting, saying it was routine and did not reveal confidential information. The call was “a rehash of previously openly discussed information,” he said.

Barlow said he had no transcript of the call, and Bank of America also declined to make a recording or a transcript of the call available.

On Thursday, D’Andrea, as the sole PUC commissioner, will consider clawing back power price that hit $9,000 per megawatt hour, about $16 billion in all, and another $1.5 billion in fees tied to those prices.

Citing grid rules, a state market adviser has recommended the pricing and related fees to be cut. Top state officials this week also called on the PUC and grid operator to “correct” the pricing and rescind about $16 billion in charges.

Previously, D’Andrea rejected a rollback, arguing “it is impossible to unscramble the egg,” insisting the decision to raise prices during the cold snap was known to all grid users.

The need to settle electricity trades that same day on the Intercontinental Exchange Inc (NYSE:ICE), ruled out any change, D’Andrea said last week. Since that decision, the governor, lieutenant governor and 28 of 31 Texas state senators have demanded a rollback.

“These corrections are squarely within your authority, whether by your own action or an order to ERCOT,” the senators told D’Andrea in a letter on Tuesday.

ICE this week indefinitely delayed settling power trades tied to grid operator Electric Reliability Council of Texas (ERCOT).

In a note on Wednesday, analyst Julien Dumoulin-Smith wrote since D’Andrea’s rejection of repricing “recent days have seen greater uncertainty reemerge,” citing the governor and lieutenant governor’s comments.

Exclusive: Texas power regulator, under pressure to roll back storm prices, huddles with Wall Street

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.

Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

You May Also Like

Uncategorized

Neque porro quisquam est, qui dolorem ipsum quia dolor sit amet, consectetur, adipisci velit, sed quia non numquam eius modi tempora incidunt.

Uncategorized

Nemo enim ipsam voluptatem quia voluptas sit aspernatur aut odit aut fugit, sed quia consequuntur magni dolores eos qui ratione.

Uncategorized

Quis autem vel eum iure reprehenderit qui in ea voluptate velit esse quam nihil molestiae consequatur, vel illum qui dolorem eum.

Uncategorized

Neque porro quisquam est, qui dolorem ipsum quia dolor sit amet, consectetur, adipisci velit, sed quia non numquam eius modi tempora.

Disclaimer: Buzzclever.com it's managers and its employees (collectively "The Company") do not make any guarantee or warranty about what is advertised or above. Information provided by this website is for research purposes only and should not be considered as personalized financial or health advice. Copyright © 2021 Buzz Clever. All Rights Reserved