On June 23, the Texas Supreme Court ruled that the Electric Reliability Council of Texas (ERCOT), responsible for managing the state power grid, can’t be sued for grid-related problems during the winter storm of 2021.
According to the Texas Supreme Court, two lawsuits, one filed by CPS Energy, the municipal utility provider in San Antonio, and the other by Panda Power Funds, a private power plant developer located near Dallas, were dismissed by the justices.
The 5-4 ruling from the Court granted ERCOT immunity from the lawsuits seeking compensation for fatalities, injuries and damages from the winter storm unless legal representatives discover alternative avenues to pursue.
CPS Energy alleged that it incurred losses of at least $18 million due to the high power prices set by ERCOT during the February 2021 storm. On the other hand, Panda Power sought a sum of $2 billion to mitigate the financial damage caused by inaccurate demand reports from ERCOT.
"ERCOT is pleased with the Texas Supreme Court’s decision, which recognizes the Public Utility Commission’s exclusive jurisdiction and that ERCOT is entitled to sovereign immunity," the grid operator said in a statement. "The Court’s careful consideration of these significant legal issues allows us to continue to focus on our core state responsibilities on ensuring a reliable grid for Texans.”
The 2021 winter storm subjected the state to freezing temperatures, leading to severe strain on the power supply. To prevent a grid failure, ERCOT issued directives to curtail power to millions of residences and establishments. But the harsh conditions resulted in the loss of over 200 lives. Post-storm assessments conducted by experts estimated the overall financial impact to range between $80 billion and $130 billion, encompassing physical damages and missed economic prospects.
In 2022, ERCOT reportedly completed onsite inspections to ensure that their recent “mandatory winterization efforts” prepared the state adequately in the event of another big freeze, Local Profile previously reported. ERCOT assured the Texas Public Utilities Commission that the grid was prepared for the upcoming winter seasons.
