Two years after Winter Storm Uri wreaked havoc across Texas, CPS Energy (formerly City Public Service Board of San Antonio) customers are still in the dark as to how much of CPS’s storm-related debt and legal fees the electric provider has accrued. Rather than working with suppliers to find solutions, CPS has chosen to take a controversial legal position that has cost ratepayers millions in legal fees and may have caused its top in-house counsel to leave. As a municipal utility that opted not to deregulate when ERCOT was created, current and future ratepayers will ultimately have to pay the price of questionable decision making as the utility company continues to use the courts to delay payments to suppliers, calling into question the wisdom of this legal strategy.

Immediately after the record-shattering storm, CPS began filing lawsuits. First, they sued the Electric Reliability Council of Texas (ERCOT) and then filed contract claims against natural gas suppliers, seeking injunctions to prevent defaults and arguing the legal defense of unconscionability of energy prices it claims were counter to public policy. Though CPS’s leadership has repeatedly expressed confidence in their legal strategy, unconscionability claims are generally disfavored, particularly when the parties to the contract in question are as sophisticated as those involved here.

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