Vistra Says 70% of Gas Force Majeures Preceded Texas Blackouts
(Bloomberg) -- Vistra Corp. pushed back on the widespread narrative that power outages fueled natural-gas supply disruptions during the Texas energy crisis, saying that most of their suppliers cut off deliveries before blackouts even began.
About 70% of force majeure claims Vistra received from gas providers occurred before Texas’s grid operator began ordering power outages on Feb. 15, Chief Executive Officer Curt Morgan said during a conference call with analysts Monday. He added that some suppliers voluntarily curtailed electricity consumption during the storm and resold that power so they could capitalize on elevated prices.
The company’s claims run counter to those of Texas’s top energy regulator, the Texas Railroad Commission, whose chair told lawmakers in February that two-thirds of gas curtailments were caused by the blackouts. The gas industry has largely escaped scrutiny from state leaders working to uncover the root causes of the catastrophe, even as some suppliers reaped unprecedented profits from the event. Kinder Morgan Inc. last week reported a $1 billion windfall.
Meanwhile, power providers have incurred huge losses related to the crisis. Vistra on Monday raised its estimated losses to $1.6 billion from $1.3 billion. The biggest driver was sky-high natural gas costs after suppliers reneged on deliveries, the company said in a statement.
Vistra fell as much as 4.9% and has lost 20% of its market value since the February storm.
“What is frustrating is that a confluence of events during the storm changed our risk position without any ability to defend against these events,” Morgan said during the call.
Vistra reiterated its estimate for full-year 2021 earnings before interest, taxes, depreciation, and amortization of $1.457 billion to $1.875 billion.
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