Brazos Electric Cooperative Files Chapter 11

[RPM 26,321]

 

[XYZ 2,154]

So, like, they weren’t hedged? There is a futures market for electricity in Texas, isn’t there?

[TwiceHorn 31,483]

They own 40GW of power generation capacity.  They cover a bunch of mostly ruralish counties.  I'm not sure how they got to be a net consumer of electricity.  Maybe they got gouged by gas prices.

[PenelopeWitherspoon 19,101]

So, like, they weren’t hedged? There is a futures market for electricity in Texas, isn’t there?

Probably not if I had to guess.

[swraith 347]

7 hours ago, TwiceHorn said:

They own 40GW of power generation capacity.  They cover a bunch of mostly ruralish counties.  I'm not sure how they got to be a net consumer of electricity.  Maybe they got gouged by gas prices.

Uh.  I think its 4GW of power generation. 

 

 

Per their website

Brazos Electric is a 3,994 megawatt generation and transmission cooperative whose members' service territory extends across 68 counties from the Texas Panhandle to Houston.

 

I'm assuming they had generation trip offline...leading to these invoices from ERCOT. Could be any of these

Jack County (1 and 2) - 1240 mw gas fired combined cycle plant

Johnson County - 258mw gas 1x1 combined cycled plant

RW Miller - 576 mw gas/diesel plant

Sandy Creek - 1000mw coal plant (brazos has 25% offtake)

 

 

They had an RFP for energy in 2020.

https://aces-wpengine.netdna-ssl.com/wp-content/uploads/2020/09/Brazos-Electric-Cooperative-2020-RFI-for-ERCOT-Energy-Resources-.pdf

 

According to Fitch....BPEC has been "short" and taking advantage of lower ERCOT pricing in recent years

https://www.fitchratings.com/research/us-public-finance/fitch-affirms-brazos-electric-power-cooperative-inc-tx-idr-at-a-outlook-positive-18-06-2020

 

So its possible BPEC was "short" and had units trip offline...which would be a double whammy.  Just speculation on my part.

[Pato del Muerto 52,501]

So the state or county picks up the business and it’s back to a good old boring public utility again?

[Nice Guy Eddie 13,512]

Major flaw of deregulation if providers start to run to bankruptcy when the max prices are hit.

Who is left holding the bag when a provider fails to pay? I assume ercot makes up the difference because we would never expect a private business like a power generation company to take on that risk. Which in turn, we all make up the difference so the generation companies can make their profits.

Edited March 2, 2021 by Nice Guy Eddie