Texas’ two newest utility regulators met with ERCOT staff and market participants for the first time on Monday, albeit virtually, as they discussed grid preparations for the upcoming summer season.
Peter Lake, recently installed as the Public Utility Commission’s chairman, said little in his introductory comments. However, he did appear to recognize the gravity of the moment, saying, “Nothing is more important than summer readiness.”
In the wake of the grid’s disastrous response during February’s winter storm and last month’s conservation call that increased the general public’s anxiety, the workshop drew a large audience that numbered in the hundreds. Among those listening in were members of the Texas Railroad Commission, which regulates the state’s oil and gas industry.
“The entire world will be watching Texas this summer. All eyes will be on us like never before,” Lake said, promising that the commission stands ready “to rise to the occasion.”
“This is the first opportunity we as an industry and we as regulators can show that the market will perform as intended,” Commissioner Will McAdams said in offering his own pep talk. “I have every reason to believe this summer will be one of our finest hours, because every stakeholder in this [meeting] has an incentive to show the world that this market works.”
McAdams, who previously served as president of the Associated Builders and Contractors of Texas lobbying group, suggested stakeholders determine whether there is “enough slack” in maintenance schedule to better coordinate dispatchable generation.
He suggested stakeholders and the PUC develop a common vocabulary to better inform the public and media, which have both criticized ERCOT for its initial advisories that confused laymen. McAdams also asked that generating facilities provide greater access to ERCOT and Texas Reliability Entity staff for weatherization spot checks and that they refrain from last-minute filings of their operating plans.
“You were part of the solution for making it through the winter event,” McAdams said, addressing the generators. “I think the work you’re doing now is important. The data and expertise you can provide ERCOT is critical for our market to adjust to whatever is coming.”
Lake and McAdams were sworn in together late last month, shortly after their appointments by Gov. Greg Abbott. One position on the bench remains open after all three previous commissioners, also appointed by Abbott, resigned in the winter storm’s aftermath. (See Lawmakers Wave Through Texas PUC Appointees.)
The PUC will conduct its first open meeting under Lake’s direction Thursday.
Woody Rickerson, ERCOT’s vice president of grid planning and operations, said more outages than normal are being processed this spring, primarily because of damage suffered during the storm, but also because the grid continues to grow. ERCOT earlier this year applied restrictions on planned transmission outages, restricting them from May 15 to Sept. 15.
ERCOT is expecting a record peak demand of 77 GW this summer. According to a report issued in December, the grid operator has a 15.5% reserve margin, and it projects almost 1 GW of battery storage will be available for the summer heat. (See Solar Power Boosts ERCOT’s Reserve Margins.)
A final resource adequacy assessment for the summer will be released Thursday.
CPS Energy Gains Restraining Order
San Antonio’s municipal utility CPS Energy has obtained a temporary restraining order that prevents ERCOT from using its collateral payments to repay the market for short pays by defaulting or bankrupt market participants.
The Bexar County District Court on April 28 granted CPS’ request for “protection … against massive errors in ERCOT’s excessive prices, which will cause price spikes in monthly bills and a blatantly unlawful result” (2021CI04574).
The court will hear from both sides May 12. CPS is hoping for an injunction that would remain in effect until the case goes to trial.
At issue is the $47 billion in market transactions during the storm Feb. 15-19. ERCOT says it is short $2.99 billion as of April 30.
“ERCOT’s latest unilateral and aggressive move is an attempt to unlawfully force our customers to pay for the insolvency of other market participants, caused by ERCOT’s own mistakes,” CPS CEO Paula Gold-Williams said in a press release. “Disappointingly, ERCOT continues to inject uncertainty into the market while failing to address its errors, which is contributing to one of the largest illegal transfers of wealth in the history of Texas.”
