Texas electricity overcharge estimate reduced to $3.2B, no benefit for electric customers

There’s been a dramatic reduction in the $16 billion electricity overcharge estimate from last month’s winter storm. And consumers shouldn’t expect to see any benefit on their electricity bill.

The Electric Reliability Council of Texas, the state’s electric grid operator, reduced the estimated overcharge from $16 billion to $3.2 billion.

That overcharge happened over two days when wholesale prices spiked and utility companies had to pay exorbitant rates for electricity.

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Even if electric companies are able to get some of their money back, the head of the Texas Public Utility Commission said it won’t help consumers.

"Because the retail electric companies are the ones that take the risk and hedge and the customers, their customers have a fixed rate. Or even if they have a variable rate contract with them, that variable rate is set ahead of time. So that money is not going to flow to the customers," PUC Chairman Authur D’Andrea said.

D'Andrea also told state lawmakers he believes it will be difficult for electric companies to increase their rates.

He said several companies did not take on debt from the overcharge and will compete for new customers with lower rates.