ERCOT Winter Storm Uri Charge Explained

ERCOT Winter Storm Uri Charge is an additional fee implemented by ERCOT to recoup unpaid balances left by the electric companies that are no longer in operation.

What is the ERCOT Winter Storm Uri Charge?

The new ERCOT Winter Storm Uri Charge is a fee that ERCOT is implementing to collect the money that they billed to electric companies that have gone out of business due to the February 2021 storm, thus leaving an unpaid balance. ERCOT is passing on the unpaid charges (the debt) to all Texas retail electric providers who remain in business and to their customers.

Why is there an ERCOT Winter Storm Uri Charge?

In February 2021, the extreme temperatures of Winter Storm Uri caused a surge in the demand for electricity across Texas.

ERCOT kept the price of electricity at $9,000 per megawatt-hour in place throughout the demand causing companies to accrue astronomical costs. The unprecedented cost triggered a series of financial defaults for power companies across the Texas electricity market and many of those companies ended up going out of business as they were unable to pay ERCOT.

To address the financial defaults the Texas Legislature passed House Bill (HB) 4492 in June 2021. HB 4492 added Subchapters M and N to Chapter 39 of the Public Utility Regulatory Act (PURA) and granted authority to the Public Utility Commission of Texas (PUCT) to approve two debt financing mechanisms. One of which is the “ERCOT Winter Storm Uri Charge” that is passed on to Texas customers.

ERCOT charge

Are all electric companies adding an additional charge?

We believe that all energy providers and customers in the state of Texas are being made to pay ERCOT additional money to cover their loss. If you would like further information about Subchapters M and N to Chapter 39 of the Public Utility Regulatory Act, read about it on ERCOT’s website.

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