Washington.- Brazos Electric, the company of electric power oldest and largest of Texas, announced this Monday that it has resorted to bankruptcy because its debts amount to 10 billion dollars and its assets are only one billion dollars.
The firm, which provides power to 16 distribution cooperatives and serves more than 1.5 million residents, was hit by two winter storms in February that left some 4.3 million businesses and homes without power for several days in the state.
“Before the harsh winter weather, Brazos Electric was a financially robust company, “the firm said in a statement, in which it indicated that, under the bankruptcy, will initiate a financial restructuring.
During the emergency Brazos and other energy supplying companies had to purchase replacement supplies at higher rates and had to pay other companies’ rates.
Last Friday Electric Reliability Coucil of Texas (ERCOT), the entity that operates the state’s electrical grid, indicated that there were about $ 2.1 billion in initial unpaid bills.
“As a result of catastrophic failures during storms, ERCOT I present Brazos excessively high bills for collateral costs, requiring payment in a few days, “according to the power company.
“As a cooperative whose costs are passed on to members and ultimately charged to minority consumers served by member cooperatives, Brazos Electric determined that it cannot unload this catastrophic financial event on its members and those consumers, “the statement added.
Last week, Denton Township in northern Texas, sued ERCOT in state court to prevent you from being charged fees not paid by other network users.
Denton Electric could face a claim of tens of millions of dollars for fees not paid by other users of the network, according to the lawsuit.
The financial debacle of Brazos and, eventually, other electricity companies in Texas, is the result of the decision of ERCOT which raised its rates to $ 9,000 per megawatt / hour for more than four hours and charged heavy fees for its services.
Industry sources indicated that this increase raised rates 500 times above their usual level.
The communiqué of Brazos Electric notes that the company will implement a financial restructuring and, meanwhile, “remains committed to providing affordable and reliable electricity service to its member cooperatives.”
“This action was necessary to protect cooperatives and more than 1.5 million retail members against unaffordable electricity bills,” said Clifton Karney, vice president of the firm, in a statement.