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Sun Feb 28, 2021, 12:22 AM

The Quiet Winner of the Texas Energy Crisis

Macquarie, an Australian investment bank, is poised to profit heavily off Texasís briefly surging energy prices during the snowstorm. The Biden infrastructure program could be its next conquest.

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Texas officials are devising ways to bail out these consumers, which is an indirect bailout for companies like Griddy (as long as it dodges a $1 billion class action lawsuit for exorbitant charges). And the overall system has been transferring wealth from consumers to electricity companies for two decades. Customers buying their electricity from a menu of companies rather than local utilities paid $28 billion more over the past 20 years.

Thatís good news for Griddy, and itís really good news for a powerful yet obscure Australian investment bank that staked Griddy with an undisclosed amount of capital late last year. Itís called Macquarie Group, and perhaps no other business expects such rewards from the Texas energy mess.

Macquarie, which trades in commodities like electricity and natural gas, has already announced that it would get up to a $215 million boost from the run-up in spot prices. That was enough to increase full-year profit expectations for the bank by 5 to 10 percent, just from this one action.

Other energy traders enjoyed similar windfalls to Macquarie, literally gloating about their ďjackpotĒ at the expense of Texas consumers. But few companies are as well positioned to profit from two interconnected challenges America will soon embark on: modernizing the energy mix and rebuilding crumbling infrastructure. In addition to energy trading, Macquarie owns controlling stakes in utilities and pipelines. Plus, itís a major player in infrastructure privatization projects like highways, and could stand to benefit from a large-scale infrastructure bill being discussed in Congress. Macquarie is the next corporate giant we have to all learn about, and its recent history should not inspire confidence.

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Macquarie has operated numerous toll roads over its life span, from the Chicago Skyway to the South Bay Expressway in San Diego to the Indiana Toll Road. Those last two ended in bankruptcy, which Macquarie blamed on the Great Recession. The company still managed to profit off running those projects into the ground, despite bad traffic projections and mismanagement. It employs a byzantine ownership structure that allows it to sever bad investments easily and move on. And it continues to win more bids, like a partnership with Australia-based Transurban to build toll lanes for the Washington Beltway. Macquarie also won a recent contract to install broadband throughout Kentucky, which came in $93 million over budget.

These projects are often flawed by their very design. Because the private company needs to earn a profit in ways a public provider doesnít, it can only succeed by gouging customers, cutting labor or safety costs, or both. Cities and states jump at the lure of an up-front payout, but then lose democratic control over a public asset like a road.

https://prospect.org/environment/macquarie-quiet-winner-of-the-texas-energy-crisis/



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Reply The Quiet Winner of the Texas Energy Crisis (Original post)
Klaralven Feb 28 OP
uriel1972 Feb 28 #1
rampartc Feb 28 #2
uriel1972 Feb 28 #3
rampartc Feb 28 #4
uriel1972 Feb 28 #5

Response to Klaralven (Original post)

Sun Feb 28, 2021, 12:27 AM

1. Macquarie, Rupert Murdoch and Ken Ham...

I would like to say bow sorry I sm to see my country produce such horrors.

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Response to uriel1972 (Reply #1)

Sun Feb 28, 2021, 02:29 AM

2. who did their majesties send to settle your country?

i suppose convicts were a better population than our religious fanatics.

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Response to rampartc (Reply #2)

Sun Feb 28, 2021, 08:09 AM

3. Not all settlers were convicts...

We had an aristocracy of wealth and privilege transplanted here as well and our fair share of religious ratbags too.

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Response to uriel1972 (Reply #3)

Sun Feb 28, 2021, 08:21 AM

4. i know. just pulling 'yer leg.

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Response to rampartc (Reply #4)

Sun Feb 28, 2021, 09:42 AM

5. 😎

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