The Texas energy crisis has morphed from a power grid failure to a humanitarian emergency to a credit crisis as billions of dollars in power bills come due.
According to FT, electricity retailers, municipal utilities, and power generation companies were purchasing wholesale energy during the crisis when rates surged to a cap of $9,000 a megawatt-hour last week, owe a whopping $50 billion.
ERCOT, the state's grid operator, warns that some market participants have yet to post collateral to cover some of the bills as defaults begin.
Kenan Ogelman, ERCOT's vice-president of commercial operations, said market participants who buy power from them have to post collateral as a down payment on energy purchases. He said some entities have "failed to deliver it."
"Defaults are possible, and some have already happened," Ogelman warned.
Read this CAREFULLY!