Trial over Texas co-op’s $2 bln power invoice paused for mediation

Ice hangs from a automobile license plate in Dallas, Texas REUTERS/Jeff Mitchell

  • Chapter trial on maintain for now
  • Choose urges negotiations to resolve dispute

(Reuters) – The most important electrical cooperative in Texas and the state’s power grid operator on Thursday agreed to mediate their dispute over an almost $2 billion invoice stemming from final 12 months’s historic winter storm that knocked out energy for tens of millions of Texans.

Brazos Electrical Energy Cooperative contends that the Electrical Reliability Council of Texas violated the phrases of their contract when it charged $9,000 per megawatt hour throughout a lot of the storm, which lasted a few week. A trial that started on Feb. 22 over ERCOT’s $1.9 billion declare in Brazos’ chapter shall be paused on account of the mediation.

The cooperative filed for chapter in March 2021 on account of the invoice from the storm. It had requested U.S. Chapter Choose David Jones in Houston, who’s overseeing its Chapter 11 case, to drastically scale back ERCOT’s declare. Brazos, which had one other $2 billion in funded debt on the time it filed for chapter, says the quantity it owes ERCOT is nearer to $770 million.

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The result of the trial, or any decision reached in mediation, will decide how Brazos strikes ahead in its chapter. It has mentioned it could actually’t develop a reorganization plan till it is aware of precisely how a lot it owes ERCOT.

Jones mentioned throughout Thursday’s listening to that the events ought to “sit in a room and perceive what the choices are.”

U.S. Chapter Choose Marvin Isgur, who can also be primarily based in Houston, will oversee the mediation.

The case is In re Brazos Electrical Energy Cooperative Inc, U.S. Chapter Court docket, Southern District of Texas, No. 21-30725.

For Brazos: Lou Strubeck and Nick Hendrix of O’Melveny & Myers; Jason Boland, Paul Trahan and Steve Peirce of Norton Rose Fulbright US; and Lino Mendiola, Michael Boldt and Jim Silliman of Eversheds Sutherland (US)

For ERCOT: Kevin Lippman, Deborah Perry, Jamil Alibhai and Ross Parker of Munsch Hardt Kopf & Harr

Learn extra:

Texas chapter trial begins over $2 bln power invoice after 2021 winter storm

One 12 months after an epic storm, Texas’ largest electrical co-op takes on grid operator

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Maria Chutchian

Maria Chutchian studies on company bankruptcies and restructurings. She could be reached at [email protected]

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