In Tuesday’s Board meeting, SBEC Board and staff held a long discussion on how we move forward with several options to pay the wholesale power bill associated with February’s winter event. By now, most of you have heard about the $9.00 per kilowatt hour (kWh) ERCOT market pricing that was used during the Winter Storm Uri event. San Bernard’s blended wholesale power rate for the whole month of February was calculated to be $1.25 per kWh. With that said, our total invoice cost came to $85,123,127.17 while SBEC’s normal bill for this month has averaged around $5 million in years past. While I had hoped for some sort of legislative intervention, I was highly disappointed that the Texas House of Representatives and Texas Governor Greg Abbott failed to act on Senate Bill 2142 introduced by 28 of the 31 members of the Texas Senate. SB 2142, as proposed, called for an adjustment to market pricing during the winter storm event and could have reduced the amount of ERCOT market charges to SBEC by approximately $30 Million.
SBEC Management and the Board of Directors agreed to start recouping this massive cost difference in a way that our membership could bear at this time. Starting with April billing cycles and continuing forward, SBEC members will see that the Generation and Transmission (G&T) portion of your SBEC bill will be raised from $0.0765 to $0.0825. Simply stated, this will add $6.00 per every 1000-kilowatt hours (kWhs) you use. Please see the attached chart below showing examples of different kWh usages and the comparison effect you should expect.
Now, this is where it is hard to explain - even though we have the invoice we must pay, there could be adjustments made later. The reason for that is because ERCOT gives all companies 90 days to ensure that the billing is correct, and we wait for a certified market settlement called “finals” to clear. I do not anticipate changes but, I did not expect to be “holding the bag” that the Texas House and Governor handed me either. But to the best of my knowledge and with the information that I have currently, I DON’T anticipate us going up any further on this adjustment. I cannot promise it will go down either. Once all billing matters with this event are final, we will identify the charge on your billing as a separate line item. I am trying to be as transparent as possible, and I will make this promise to each of you. Once we have the complete picture in front of us-I will make myself available to any member (individually or collectively) to discuss this face to face or by phone. Never in my wildest nightmare did I ever think I would have to go through an issue such as this-and I’m betting you are feeling the same way.
Also, the state legislature is discussing bills that would create Securitization Loans for utilities to utilize for long term/low interest rate financing of these unprecedented power invoices. This can have an impact on the bottom-line figure.
I’ve had some input from the membership on how we should go about this collection and we honestly have looked at several ways. We still have lots of things that we must decide on, and each decision will have a bearing on the eventual outcome. The bottom line is that this amount will have to be collected at some point and I submitted to the board (and they agreed) the sooner we tackle it-the better. We will continue to concentrate our efforts on how to lessen the impact to each of our members and you will be notified of any progress we make. But again, we need to start the process going forward.