New Braunfels
5:54 pm
Wed July 23, 2014

NBU Wins $29.7 Million Lawsuit Against LCRA

Credit New Braunfels Utilities

A jury in Comal County has found in favor of New Braunfels Utilities in a lawsuit against the Lower Colorado River Authority.

The verdict could mean a nearly $30 million judgment against the LCRA for violating its contract with the local utility.

In returning the verdict in favor of NBU, the jury found that LCRA had breached its 1974 Wholesale Power Agreement with the utility and violated state law by charging excessive and discriminatory rates.

NBU CEO Paula DiFonzo said NBU was one of several companies that could not come to terms with LCRA over contract extensions, and the jury ruled that the wholesale provider gave more favorable rates to utilities that agreed to extend their contracts through 2041.

“We had a contract that began in 1974 and was scheduled to end in 2016," DiFonzo said. "During this time over the last 10 years or so, LCRA has been negotiating contracts for extension."

DiFonzo said although rate payers have overpaid over the years, the money NBU will realize from the verdict will not be directly refunded to consumers:

“We don’t have a way to actually look through and find out how to make that match," DiFonzo said. "These are damages over different periods of time and over long periods of time, so there’s not a real way to go back and identify that. So this will come back into our community in the form of lower power costs."

LCRA issued a statement saying it is studying the verdict and analyzing its next steps. A final judgment in the case will be handed down at a later date.