The Gist

Due to Rayburn and Brazos having large (around $3B in total) default in the aftermath of Winter Storm Uri, ERCOT determined that it was probably not a good idea to offer unsecured credit to anyone anymore, even public power.  This NPRR removes unsecured credit from the ERCOT market.  It has received significant push back from public power (munis/co-ops, the main recipients of unsecured credit).  A compromise of a reduction of unsecured credit from the current amount of (up to) $50M to some lower amount seems possible.

Important Actions

• 1/13/22 NPRR1112 introduced at PRS and tabled for discussion ate the Credit Working Group.
• 1/19/22 CWG meeting sees significant pushback on the elimination of unsecured credit.
• 2/2/22 Munis and Co-ops file comments changes “elimination of unsecured credit” to “reduction of unsecured credit to $27.5M, corresponding to reduction of HCAP from $9000 to $5000”
• 2/16/22 Desktop edits in CWG meeting raise maximum unsecured credit limit back to $30M.
• 3/9/22 PRS approves CWG edits on the combo ballot
• 3/14/22 CWG does not endorse their own edits.
• 4/6/22 NPRR1112 ($30M version) passes PRS

Reference

NPRR1112 (ERCOT)

Muni/co-op comments

Meeting Notes

4/6/22 PRS

3/14/22 CWG MCWG

3/9/22 PRS

2/16/22 CWG MCWG

2/2/22 WMS

1/13/22 PRS

1/19/21 CWG MCWG

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