South Texas Electric Cooperative Inc. (STEC) submitted a proposal to the Public Utilities Commission (PUC) of Texas requesting modification of the RFP to allow other proposals, including cost allocations for wind and solar sources.
In a proposal published last month, STEC requested modification of the RFP and noted that the organization wishes to continue to use the market-based framework that is already in place. This would be alongside a reliability service to ensure that the grid functions reliably regardless of harsh weather, maintain "adequate generation in times of low non-dispatchable generation" and cost allocation that is non-discriminatory.
"Comes now, South Texas Electric Cooperative, Inc. ('STEC') and provides the following information regarding, and including, its proposed Reliability Service, attached hereto, for review by the Public Utility Commission of Texas ('PUCT' or 'Commission') in an effort to continue to work toward resolution of the reliability problems in the Electric Reliability Council of Texas, Inc. ('ERCOT') market," STEC said in their official proposal.
A letter sent from Gov. Greg Abbott to the PUC in 2021 instructed the commission to streamline incentives within ERCOT in order to support the development and upkeep of proven sources of power including natural gas, coal and nuclear power while also requesting directives that would allocate reliability costs to energy producers that cannot guarantee availability, such as wind or solar power, according to Houston Daily.
Senate Bill 3 defined a Reliability Service targeted to "ensure appropriate reliability during extreme heat and extreme cold weather conditions and times of low non-dispatchable power production in the power region."
The Texas Public Policy Foundation submitted its own comments to the PUC providing support for the proposal put forth by STEC. The TPPF focused primarily on cost allocation being the most important inclusion in STEC's proposal, mentioning that none of the current proposals have successfully addressed the issue. While they are not endorsing a certain reliability standard at this time, TPPF believes it to be absolutely essential "the PUC define a quantifiable and transparent standard," according to the proposal.
STEC has been in operation for over 75 years as a Generation and Transmission Cooperative for nine member cooperatives of South Texas.