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Business

NBU To Receive $20.5 Million from LCRA in Breach of Contract Lawsuit

New Braunfels Utilities has agreed to a $20.5 million payment from LCRA to settle a lawsuit it won earlier this year against the energy provider.

The settlement comes several months after a jury found the Lower Colorado River Authority had breached its contract with NBU.

The jury in July found that LCRA, the wholesale power provider for NBU and others, had been giving more favorable rates to its customers who had agreed to long-term extensions of their contracts through 2041.

NBU did not extend its contract and began experiencing rate hikes, ultimately taking the LCRA to court.

Spokeswoman Gretchen Reuwer says when NBU learned LCRA was charging discriminatory rates, it cancelled its contract effective January 1, 2013.

“We’ve been very successful out on the open market since we no longer were under contract with LCRA with obtaining much lower power costs, and we have passed those savings on to our customers,” she said.

Reuwer calls the settlement favorable. She says NBU leadership plans to hammer out details for use of the money, which she expects to include minimizing pass-through costs for customers into the future and investing in capital improvements.