Congressman Castro Introduces Bill to Prevent Natural Gas Price Gouging During Emergencies
WASHINGTON – Today, Congressman Joaquin Castro (TX-20) introduced the Gas Consumer Emergency Market Protection Act in the House of Representatives to address the dramatic increase in natural gas prices in relation to Winter Storm Uri as well as establish a federal circuit breaker – which would impose natural gas trading limits during national emergencies.
Congressman Lloyd Doggett is an original cosponsor.
“While Texas families faced life or death situations and struggled to stay warm amid freezing temperatures, natural gas sellers raked-in over $10 billion in profits by raising prices as much as 10,000-percent," said Congressman Castro. "This bill will identify those who have unfairly profited from the Texas winter storm and put in place safeguards to prevent any future entity from price gouging Americans during an emergency. Texans in need should not pay for the greed of oil and gas corporations trying to profit off of their misery."
“After struggling through a deadly winter storm without power, running water, or heat—thanks to the avoidable failures of the Abbott Administration—so many Texan families endured the additional insult of being blindsided with outrageous energy bills,” said Congressman Doggett. “Profiteering insult to greed-caused injury. The Gas Consumer Emergency Market Protection Act takes a strong step forward to protect Texan lives and life savings by laying key groundwork for delivering accountability and action to protect consumers from price gouging in the natural gas market during future emergencies, and any future Republican failures during those emergencies.”
In February 2020, Winter Storm Uri was a devastating weather event that caused at least 200 deaths in Texas, $300 billion dollars in economic damages in the state, and has burdened millions with heightened gas and electric bills.
The natural gas energy commodity market underwent violent price fluctuations without any mitigation, spiking over 10,000-percent. Additionally, natural gas pricing for retail consumers is not subject to discovery and consumers are often unaware until receiving a bill.
The Gas Consumer Emergency Market Protection Act would:
- Direct the Commodity Futures Trading Commission (CFTC) to undertake an inquiry into the beneficiaries of the commodity price escalation during Uri and report to Congress with recommendations on how to address future events.
- Direct the CFTC to conduct a rulemaking requiring natural gas markets to implement trading ceilings during declared emergency events.
- Establish a federal fine for entities that engage in price distortion activities during times of emergency.
Quotes from supporters:
“While our friends and neighbors across Texas struggled together to withstand an unprecedented challenge, certain natural gas suppliers were busy making profits at the public’s expense,” said Paula Gold-Williams, President & CEO, CPS Energy. “Such behavior is wrong and must be stopped. CPS Energy believes that current Texas law already renders the outrageous and excessive prices that certain suppliers charged CPS Energy unenforceable, as they are violations against public policy. Since not all market participants have the ability and will to mount legal challenges against such predatory behavior, we feel it would be very helpful to establish additional statutory standards to protect more consumers from future attempts to excessively profit from declared natural disasters. Fortunately, Congressman Joaquin Castro’s bill would do just that by imposing limits on natural gas trading during emergencies, thereby insulating consumers from future exploitation. CPS Energy remains committed to protecting our customers from unconscionable prices, and thanks Mr. Castro for his work on their behalf. With this legislation, we take another step toward ensuring the wellbeing of our customers.”
“If enacted, Congressman Castro’s bill would provide lawmakers with more information about what happened to the natural gas market during Winter Storm Uri in order to learn from this experience and avoid repeating the same mistakes in the future,” said Dave Schryver, President and CEO, American Public Gas Association. “The bill also offers meaningful solutions to protect consumers and ensure access to energy that is both reliable and affordable during extreme weather events.”
“The cold weather events of last winter were a threat to life, property, and the economy of the affected regions,” said Joy Ditto, President & CEO, of the American Public Power Association. “While inquiries as to the causes of these devastating effects continue, it is clear that natural gas price increases were abnormal. We appreciate Congressman Castro’s efforts to prevent these damaging economic results from Winter Storm Uri from happening again. We also look forward to working with him and the rest of Congress to find ways to prevent unnecessary financial harm to consumers during future extreme weather events.”
“The Large Public Power Council (LPPC) supports the goals of Congressman Castro’s Consumer Emergency Market Protection Act to mitigate extreme price fluctuations in natural gas markets when natural disasters occur,” said John Di Stasio, President, Large Public Power Council. “All LPPC members strive to provide reliable, resilient, and affordable electricity and to protect their communities during times of extreme weather. A circuit breaker for market pricing during such events can help protect consumers.”
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