AUSTIN — Texas lawmakers have ordered an overhaul of the state’s electricity market in response to blackouts during February’s deadly winter 2021 storm that contributed to the deadly calamity.
But some experts are troubled that the weather surrounding the near grid collapse was not taken into account in a government report released on Thursday that could be instrumental in restructuring the way power plants and utilities utilities buy and sell electricity in Texas.
The Public Utility Commission, Texas’ energy regulator, commissioned the report in May from consulting firm E3. The report evaluated several proposed market designs to move Texas away from its current deregulated energy market, which PUC Chairman Peter Lake called a “crisis-based market.”
In analyzing energy demand peaks during the winter, the report looked at weather data from 1980 to 2019.
Using this data from the winter storm was “beyond the scope of this study,” the report says in a methodological explanation that recommended network operator ERCOT to include the 2021 freeze, which killed more than 200 people. , in a future analysis.
The report also did not include data from this year’s summer heat wave in which statewide electricity demand records were repeatedly broken and led the ERCOT issue multiple retention warnings.
“They ignored real life, extreme weather and the fact that weather could get worse,” said Alison Silverstein, an energy consultant who previously worked for the Federal Energy Regulatory Commission and the Public Utility Commission. “Recent real extreme weather conditions have stressed the grid.”
The report says it ignored the winter storm of 2021 because the Public Utilities Commission has taken steps since then to improve the resilience of power plants.
“… [T]The consulting team does not expect the same levels of outage to be seen in similar weather conditions due to improvements made by the PUCT, such as weatherization rules and firm fuel supply” , the report says, referring to the new extreme weather requirements. incentives for on-site emergency preparedness and fuel.
Lake, the commission’s chairman, said the consultants recognized there was no “silver bullet” to deal with extreme winter weather events like the 2021 storm.
“The range of other reforms we have put in place – from winterization to better coordination with the natural gas industry to the new natural gas supply chain – combined will mitigate the impacts of future disaster events. Uri type,” Lake said of the storm. .
The report recommends that Texas pursue a market structure similar to a capacity market, which pays power generators even when their generators are offline in order to subsidize their operations and keep an adequate supply of electricity available during peak times. demand and emergencies.
But the Public Utilities Commission has signaled it wants to pursue a different structure, one it calls the “performance credit mechanism,” which is a hybrid between the preferred proposition and the deregulated market, according to a staff memo.
“It’s fascinating to see the PUC go against the consultants’ recommendation,” said Austin-based energy consultant Doug Lewin.
The ins and outs of the performance credit mechanism will be debated over the next two months.
Lake said he aims to get a new market structure approved before the Legislature begins its next legislative session on January 10.
In the meantime, the public and stakeholders will have until noon on December 15 to submit their comments on the proposal.
“Once we get all of that feedback, our staff, our commissioners will analyze it all, take that feedback and listen to what the public thinks is working, what isn’t working and adjust course if necessary,” Lake said.
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