Texas Democratic Governor-elect Gina Hinojosa is promising to use emergency powers to freeze residential electricity rates on her first day in office, a plan that is already drawing sharp pushback from energy policy analysts who say the move collides with Texas' competitive electricity market and could lead to shortages.
In an interview with the Texas Tribune, Hinojosa said, "Within an hour of taking the oath of office, I will declare a high-cost emergency in the state of Texas and issue an emergency executive order to … freeze electricity rates." She has also pledged to suspend the state gas and diesel tax as part of the same emergency declaration.
The incoming governor defended the plan as a response to what she calls an affordability crisis. "On Day One as governor, I'll freeze residential electricity rates and make corporations finally pay their fair share," Hinojosa told a local energy data group, according to Fox News.
But Nick Loris, president of C3 Solutions, a conservative coalition focused on energy and environmental policy, told Fox News Digital that the emergency declaration will likely face immediate legal challenges from energy providers. "The Texas Disaster Act lets the governor declare disasters and suspend the regulatory laws and statutes that are in existence. But I think there is a high degree of skepticism, both from courts but also from state policymakers, that this warrants such a claim—and that it is such a disaster," Loris said.
Loris added, "I would imagine if there were legal challenges, it would come from those affected parties."
At the heart of the dispute is Texas' uniquely decentralized electricity market. In 1999, the state passed Senate Bill 7, which opened most of the state to retail choice and allowed customers to pick their preferred retail electric providers beginning in 2002. That means retail providers—not regulators—set electricity prices, leaving the governor with very little direct authority over residential rates.
According to Fox News, Hinojosa's plan is raising concerns that such a freeze will clash with Texas' competitive energy sector and could inadvertently create energy shortages as suppliers are prevented from adjusting their prices to match supply and demand.
Other outlets covering the story have drawn comparisons to New Jersey, where Democratic Gov. Mikie Sherrill signed an executive order declaring a state of emergency and freezing rate hikes by the state's utilities. That effort has reportedly failed to meaningfully lower electricity prices, because freezing rates does not erase the underlying supply and transmission costs that drive them.
Hinojosa's campaign tied rising property taxes and electricity bills to Republican Gov. Greg Abbott's policies. According to the Texas Tribune, the state saw a 3.3 percent increase in the average residential electricity price between August 2025 and August 2026, roughly in line with the national increase.
The governor-elect has also promised to direct the Public Utility Commission to freeze rates until the legislature passes laws ensuring data centers and other high-load users pay for themselves.
It is not yet known whether Hinojosa's office has prepared a legal defense for the anticipated challenges, or whether the Republican-controlled legislature would move to block the order. The Texas Disaster Act's scope, and whether an affordability crunch qualifies as a disaster under its terms, is likely to be the central question in any courtroom fight.
Hinojosa is set to be sworn in in January.
Our Take
Let's be clear about what Gina Hinojosa is actually proposing. She wants to declare a fake emergency, seize control of prices in a market that has been deliberately built on competition, and dare the courts to stop her. This isn't affordability policy—it's a power grab dressed up as compassion.
Texas didn't stumble into its retail choice market by accident. Lawmakers opened the grid to competition because they understood a simple truth: when government fixes prices, it distorts the signals that tell producers when to build and suppliers when to sell. Freeze rates below what it costs to keep the lights on, and the people who can't recover their costs stop showing up. That's how you get shortages—not from a hurricane, but from a politician with a pen.
Loris is right to be skeptical. The Texas Disaster Act was written for floods, fires and freezes—not for the inconvenience of a modest rate increase. And notice the other half of her plan: suspending the gas and diesel tax. That's not an energy policy; that's a revenue hole she'll have to fill somewhere, likely from the same taxpayers she claims to be rescuing.
New Jersey already ran this experiment. Governor Sherrill froze the hikes, and the rates didn't come down because the costs didn't go away. Texans should ask Hinojosa one simple question before January: if you can override the market with the stroke of a pen, what stops the next governor from doing the same thing for a cause you don't like?
The answer, folks, is the Constitution and the courts. And if Hinojosa's order survives, every Texan who values free enterprise should be paying very close attention.
