![]() ![]() Simpson, owner of the Houston data company Circles X and a former trading director at Enron. When gas prices then climbed to hundreds times normal levels, the complaint alleges, a number of companies informed clients with whom they had contracts to sell gas at a fixed price that they could not make delivery, allowing them to sell their gas into spot markets and reap billions of dollars in profits. In a lawsuit filed in Harris County District Court last month, CirclesX Recovery, which represents thousands of Texas energy customers, claims firms including Energy Transfer, Kinder Morgan, BP, Conoco Phillips and CenterPoint Energy engaged in an Enron-style scheme to cut off gas production or divert supplies into storage days ahead of freezing temperatures that would eventually cripple the Texas power grid. Energy Transfer posted its highest quarterly net income on record, more than three times its previous best quarter.A former Enron trader is suing some of the nation’s largest energy and financial firms, claiming they diverted natural gas supplies and cut off production in a scheme to artificially drive up prices ahead of the 2021 winter storm that left about 200 dead and millions of Texans without power. What Abbott didn't mention was the massive windfall key industry players made during the freeze. Even though gas failed in its role as a reliable backup fuel during the freeze, Abbott pushed regulators in a letter to strengthen incentives for fossil fuel and nuclear generators while increasing "reliability costs" for intermittent renewable power sources. ![]() This week, Governor Greg Abbott appeared to double down on his early assessment that wind and solar were prime culprits of the freeze. Texas lawmakers have set aside $10 billion to help natural gas utilities cover their natural gas costs from the storm through low-interest, state-backed bonds.Ī special legislative session convened Thursday but the agenda did not include any measures to fix the power grid. Millions of Texans are now faced with the prospect of paying higher gas prices for years as utilities seek to spread the cost over a decade or more. The BNEF estimate is based on spot prices at major hubs assessed by S&P Global Platts rather than private contracts, so is likely an upper limit of the total cost. A further $3 billion was spent by utilities providing gas for cooking, heating and fireplaces. The cost of gas for power generation alone was about $8.1 billion, or 75 times normal levels. Soon customers will be saddled with the bill.Īnd it's a big one: The total comes to about $11.1 billion for a storm that lasted for just five days, according to estimates by BloombergNEF analysts Jade Patterson and Nakul Nair. Power producers were forced to pay top dollar in the spot market for whatever gas they could find. ![]() As the flow of gas cratered, everyone scrambled to secure enough supply, sparking one of the wildest price surges in history. From a report: Interviews with energy executives and an analysis of public records by Bloomberg News show that natural gas producers in the Permian shale basin began to drastically reduce output days before power companies cut them off. It's now becoming clear that while millions of Texans endured days of power cuts, the state's gas producers contributed to fuel shortages, allowing pipelines and traders to profit handsomely off them. The official autopsy of the great Texas winter blackout of February 2021 quickly established a clear timeline of events: Electric utilities cut off power to customers and distributors as well as natural gas producers, which in turn triggered a negative feedback loop that sunk the state deeper and deeper into frigid darkness. ![]()
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