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87th Legislature – Week 10

We decided to hold yesterday’s update pending action yesterday in the Senate on the ERCOT pricing error during Winter Storm Uri (see below). Here’s this week’s update …


“Repricing” the cost of electricity becomes focus of Senate. Following the independent market monitor’s finding that ERCOT mistakenly held electricity prices at the statutory cap for too long, costing ratepayers billions of dollars, both the House and the Senate held further hearings with clear focus on the ability of the Public Utility Commission’s ability to “reprice” this “error.” The hearings came on the heels of a letter – signed by 28 of 31 Senators – to the PUC asking it to reverse the billing error, and the Governor’s decision to make repricing the error a legislative emergency item.

  • Lieutenant Governor plays the role of Senator. In a highly unusual step during Chairman D’Andrea’s testimony before Senate Jurisprudence Committee, the Lieutenant Governor joined the Committee to grill the Chairman. The questioning focused on the PUC’s authority to unilaterally fix the error – something the Chairman has denied and also likened to “unscrambling an egg.” The Chairman denied having the ability to unilaterally correct the error.

  • Lieutenant Governor and Governor spar with dueling letters. Following the highly unusual move from the Lt. Governor, he sent a letter to the Governor late on Friday afternoon that asked the Governor to intercede and replace Chairman D’Andrea. Within the hour, the Governor rebuffed the Lieutenant Governor, underscoring the PUC’s position that it lacked the authority to fix the error and saying that instead it was Legislature’s prerogative to fix the issue if they wished. Just this morning, the Lt. Governor has requested an opinion of the Office of the Attorney General regarding the PUC’s authority.

  • Senate passes bill to give PUC authority to reprice. In response to the action late last week, the Senate filed, referred, passed out of committee, and finally passed a bill that would give the PUC the authority to fix the billing error. The bill would still need to pass the House – something the Speaker has said would require more debate and fact-finding. The House Committee on State Affairs is hearing invited testimony on the bill errors today, Tuesday, March 16.


Griddy files for bankruptcy, offers to forgive customer debt. The financial fallout from the pricing error continues, as Griddy Energy filed for bankruptcy on Monday. Griddy took the remarkable step of offering to forgive the debt of all customers, an unusual plan component in a bankruptcy that still requires court approval. The ultimate consequence of ERCOT’s market intervention meant sky-rocketing electricity bills for ratepayers. Those bills were collected in real-time from retail electric provider Griddy, whose innovative app charges consumers daily for their electricity usage while allowing them to see the real-time price of electricity. Griddy had saved customers money prior to the market intervention, as unlike other retailers it does not mark-up the price of wholesale electricity. The company sells itself as an important tool in balancing the Texas grid by influencing demand or load to lessen in response to price signals. In periods of peak demand, load response is much more elastic than new generation, but consumers often lack the information and incentive to react.


Tensions rise between President Biden and the Governor over the border. The migrant crisis at the border continues to intensify, creating pressure on the Biden Administration from both sides of the political aisle. In response, the Governor has increased both his focus and rhetoric towards the Biden Administration, criticizing the Administration’s “open border” policies for creating the humanitarian crisis and for enriching the cartels who profit off the human trafficking. With border patrol agents foreshadowing that the number of migrants is only going to increase, we expect this to remain a significant point of disagreement between Texas and the Administration.


Gaming bills filed. Long-awaited gaming bills have been filed. The bills include both casino gaming and sports betting. The primary bills to watch, which provide for a ballot resolution to amend the Texas Constitution are: HJR 133 and SJR 49 (casino gambling), SJR 39 and HJR 97 (sports betting)

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