Members of bankrupt Brazos Electric question strategy amid ERCOT dispute
(Reuters) – Members of wholesale power supplier Brazos Electric Power Cooperative Inc are challenging its bankruptcy strategy following the Texas winter storm that knocked out power for millions and left Brazos with a $2 billion energy bill.
Tri-County Electric Cooperative, one of Brazos’s largest members, filed papers on Wednesday accusing Brazos of pursuing a restructuring proposal that would place the financial burden on the backs of retail and commercial ratepayers. Its statements came in an objection to Brazos’ request to extend its control over the bankruptcy process until March 28, 2022.
Brazos, the largest electric coop in Texas, filed for Chapter 11 protection in March after it was hit with a $2 billion energy bill from the state’s electric markets operator, the Electric Reliability Council of Texas (ERCOT). The bill for the seven-day storm is nearly three times the co-op’s total power cost from 2020, which was $774 million, according to court papers. For several days during the storm, ERCOT set electricity prices at $9,000 per megawatt hour, around 500 times the usual rate.
Brazos and ERCOT have since been in litigation in bankruptcy court over the bill.
Now, Brazos says it needs more time to file a reorganization plan with the court. But Tri-County and another major member, CoServ Electric, say Brazos has not seriously considered options that they say would bring in more money to the estate without sticking ratepayers with the bill.