During Winter Storm Uri in February 2021, indexed-rate Texas customers received bills as high as $9,000 for a single month as ERCOT wholesale prices hit the $9 per kWh emergency cap. Fixed-rate customers paid normal bills. Their REP absorbed the wholesale spike because the supply rate was contractually locked at signing. Post-Uri PUCT reforms tightened disclosure on indexed plans but did not ban them. For residential customers in 2026, fixed-rate is strongly recommended.
What happened during Winter Storm Uri
February 14 to 20, 2021. Deep cold-air mass moved into Texas. ERCOT generation began failing as gas wells froze and gas-fired plants lost fuel supply. ERCOT initiated rotating blackouts then sustained outages across the state.
Wholesale electricity prices hit the $9 per kWh emergency cap. Indexed-rate customers (whose retail rate tracks wholesale) saw their bills explode. Some households received bills over $9,000 for a single billing cycle. Fixed-rate customers were insulated because their supply rate was locked at signing.
Indexed vs fixed customer outcomes
Indexed-rate residential customers paid $3,000 to $16,000 in extra bill cost during the 1-week Uri event. The bills were technically valid under the indexed-plan contract terms; the wholesale price they tracked spiked to the cap.
Fixed-rate customers paid their contracted rate (typically 10 to 14 cents per kWh) through the entire event. The fixed-rate REP absorbed the wholesale spike because they had hedged the contract at signing in the futures market.
Post-Uri PUCT reforms
The 2021 Texas legislature passed reforms requiring stronger disclosure on indexed plans. Indexed plans must now show worst-case pricing scenarios on the EFL. Some additional protections were added for low-income customers.
Indexed plans remain legal in Texas in 2026. The PUCT did not ban them but tightened the disclosure rules. For residential customers, fixed-rate is the structurally safer choice.
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