As Texas officials continue to unravel the myriad issues that led to a February power outage in many parts of the state, the Texas Public Utility Commission and the Electric Reliability Council of Texas (ERCOT) are promising changes to the electricity market in the state.
While few plans have been unveiled, officials hope changes will lead to a stronger electric grid. Consumers are concerned that changes could result in higher electric bills. Houston Chronicle energy reporter Shelby Webb told Texas Standard that pricing may be a part of the wholesale changes in the works, noting the goal is to have enough energy in reserve to operate without missing a beat during periods of extreme heat and cold.
“That sort of model where you can make just a windfall when grid conditions are tight, that’s sort of what they call the ‘crisis model,’ and that’s what they’re trying to move away from,” Webb told the website.
A group of renewable energy experts held a virtual webinar to discuss the planned redesign of the state’s power grid. With a goal of overhauling the ERCOT electric market by the end of the year, Doug Lewin, president of Stoic Energy, LLC, told KXAN TV that it is a daunting task.
“The commission is pushing to have a complete overhaul and redesign of the ERCOT electric market before the end of the year,” he told the station. “It is an incredibly aggressive timeline. These are very important decisions that will have long-lasting impacts.”
The Energy Alliance’s Bill Peacock, a veteran Texas analyst, has prepared a series of reports focusing on the state’s electricity market, including outlining the impact that renewable energy subsidies have had in Texas. However, some officials want natural gas to be put on the same level as renewable energy when it comes to subsidies. Natural Gas World reported that Jim Wright, a member of the Texas Railroad Commission, is making that case.
“Equalizing these incentives could assist with necessary infrastructure investments that guarantee ample supplies of this important Texas resource are available whenever they are needed,” he told the website.
However, the importance of renewable energy in the Lone Star State cannot be dismissed. The Dallas Federal Reserve reported that renewable energy accounted for a quarter of the power consumed in the state in 2020, up from just 8% in 2010. Solar capacity also continues to rise over the next three years.
In his report, Peacock noted that wind and solar power comprise the majority of new generation available for ERCOT, with wind up 44.3% since 2016 and solar generation up 425.7% during the same period. While natural gas increased by a little more than 18%, all other sources of power generation slipped, according to Peacock’s report.
Amid these competing interests, the overhaul of Texas’ energy market will move forward. EnergyWire reported that ERCOT last month unveiled details of how to make the grid more reliable, including 20 points that are already finished and another 40 it said are on track for completion. Among the finished points are a new market rule requiring generators to provide more frequent operational updates and revised grid operations.