July 24, 2012, FREDERICKSBURG, TX- Judge Scott Jenkins of the 53rd Civil District Court in Travis County denied LCRA’s motion for a temporary restraining order against Central Texas Electric Co-op (CTEC) and six other utilities. CTEC, along with the other six utilities, agreed to an expedited hearing, scheduled to begin on August 27, to determine whether a temporary injunction should be granted in LCRA’s favor. CTEC also agreed to wait until August 13 to deliver a letter to LCRA that would terminate the Wholesale Power Agreement.
“We are hopeful that there could be a resolution to this matter shortly,” commented CTEC Board President Gerald Kaspar, who attended the Tuesday court hearing. “We believe that the sooner we can resolve this issue, the better it is for our members.”
LCRA has claimed that there has been no breach of contract or discrimination between wholesale customers, but the facts tell a different story. The Wholesale Power Agreement (contract), first signed in 1974, and extended in 1987, guarantees uniform rates and pricing alternatives for all wholesale customers for the duration of the contract.
Starting in 2008, LCRA offered its wholesale customers an amended and restated wholesale contract that extended the contract term to 2041. CTEC declined, choosing instead to secure competitive power contracts on the open wholesale market after the contract expires in 2016. “LCRA has breached the uniform rate provision of the contract by offering additional pricing options only to those customers that chose to sign the extension,” claims CTEC CEO Bob Loth.
“For months LCRA has refused to negotiate, mitigate, or cure this breach,” stated Loth. “We are looking forward to our day in Court. In the meantime, we hope LCRA will begin to come forward with some solutions.”