In the aftermath of record electricity demand events, the Texas legislature and the Electricity Reliability Council of Texas (ERCOT) have enacted laws and authorized financial mechanisms that provide needed funds to stabilize the Texas electricity market and grid.

House Bill (HB) 4492

House Bill (HB) 4492 authorizes all Texas electricity providers to bill customers Securitization charges for the next 30 years in the aftermath of Winter Storm Uri. Securitization measures are effective after a catastrophe because they spread the cost over many years and minimize the impact on customers.

Securitization uplift charges are designed to preserve market stability. Securitization default charges allow for electricity providers to continue offering competitive rates while recovering the cost of defaults resulting from Winter Storm Uri over an extended period of time. These charges are directly passed through from the Electricity Reliability Council of Texas (ERCOT) as a mechanism to repay the bond.

Senate Bill (SB) 3

(SB) 3 authorizes all Texas electricity providers to bill customers Firm Fuel Supply charges from November 15th through March 15th of each year. Firm Fuel Supply Service allows for the funding necessary to ensure grid stability during extreme cold weather conditions. These charges are directly passed through from the Electricity Reliability Council of Texas (ERCOT).

ERCOT’s Nodal Protocol Revision Request (NPRR) 863

NPRR 863 created a new ancillary service, ERCOT Contingency Reserve Service (ECRS). ECRS will support grid reliability and mitigate real-time operational issues to balance supply and demand. These charges are directly passed through from the Electricity Reliability Council of Texas (ERCOT).

All Retail Electricity Providers (REPs) are billed the legislature approved Securitization and Firm Fuel Supply Charges by ERCOT. Some REPs may choose to include these components into the energy billing rate or charge as a separate line item(s) on monthly bills.

For more information, please review ERCOT’s informational page
HB 4492 Securitization.
Firm Fuel Supply.
ERCOT Ancillary Services.

Last Update: July 13, 2023