ERCOT Regulatory Changes Begin to Appear on Customers’ Bills
In response to the events surrounding Winter Storm Uri and its impact on Texas’ electric grid, the Texas Public Utility Commission and ERCOT have implemented several regulatory changes to improve grid reliability and minimize price volatility. It’s important to highlight what impact the changes will have on the average Texan electricity bill going forward.
These costs are being recovered by ERCOT by allocating them to Load Serving Entities and, ultimately, their customers on a load-ratio-share basis. At the start of 2022, customers can expect to see two to three additional line items on their power bill (1):
- Non-Bypassable Securitization Cost – Default Charge: Effective January 2022, costs will be allocated to customers and market participants over a 30-year period. Costs are estimated to be $0.00001-$0.00002/kWh (less than 0.1% increase in the customer’s total cost of electricity).
- Non-Bypassable Securitization Cost – Uplift Charge: Effective Q2 2022, costs will be allocated to customers over a 30-year period. Transmission-voltage ESIDs that have opted out of the uplift portion of securitization will be exempt from this cost increase. Costs are estimated to be $0.0003-$0.0006/kWh (0.4-0.6% increase in the customer’s total cost of electricity).
- ERCOT Ancillary Services Uplift Charge – Effective July 2021 (depending on retail supplier and date customer signed contract), increased costs will impact customer bills through at least 2022. Costs are currently estimated to be $0.001-$0.002/kWh (1.5-2.3% increase in the customer’s total cost of electricity).
(1) Estimates are for informational purposes only, based on most recent market projections, and are subject to change
