CPS Energy accuses natural gas suppliers of price gouging during winter storm, files lawsuits

Utility claims some natural gas suppliers charged up to 15,000% more for natural gas

CPS Energy CEO says the company is facing $1 billion in charges after winter storm

SAN ANTONIO – CPS Energy has filed lawsuits against many of its natural gas suppliers for “unlawful and unconscionable price gouging” during the February winter storm.

According to a news release, certain natural gas suppliers charged CPS Energy up to 15,000% more for natural gas. The utility said the price hike came during a time when 52% of the electricity generated was from natural gas. CPS Energy claims that Comstock Resources, a natural gas producer from Texas, stated that the natural gas prices they were able to charge during the winter storm were “…like hitting the jackpot...” the release said.

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“The lawsuits are designed to ensure that San Antonio residents get fair treatment instead of price gouging and gross overcharging by natural gas suppliers during last month’s weather emergency,” said San Antonio Mayor Ron Nirenberg. “We will not tolerate suppliers hitting the jackpot by exploiting average customers.”

“We filed the suits to protect our customers from unlawful, excessive, and exorbitant prices charged by certain natural gas suppliers during a state and federally declared disaster,” said Paula Gold-Williams, president & CEO of CPS Energy. “Imagine going to the gasoline pump during a natural disaster and seeing the price of a gallon of gas at about $348 or about $7,000 for a full tank. That is essentially what happened with natural gas prices during the storm. On behalf of our customers, we cannot, and we will not stand for that. What is worse, certain suppliers have already discontinued gas supply, which is a hardball tactic in the extreme.”

Earlier this month, the utility also took similar legal action against Electric Reliability Council of Texas (ERCOT), accusing it of overcharging the power company during the winter storm.

CPS Energy is asking a Bexar County district court to take the following actions to prevent harm to the utility and its customers. Among other things, CPS Energy petitioned the court:

  • To declare that any excessive charges are unlawful; and
  • In some cases, to grant a temporary restraining order and temporary injunction to prevent the gas suppliers from wrongfully declaring a default under the gas contracts

You can view a copy of the lawsuit below:

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CPS Energy faces $1 billion bill for winter weather power crisis

CPS Energy will withhold winter storm charges while seeking funds to alleviate costs

About the Author:

David Ibañez has been managing editor of KSAT.com since the website's launch in October 2000.