By Tom Kleckner
AUSTIN, Texas — ERCOT staff said its preliminary analysis of Lubbock Power & Light’s integration into the Texas grid reveals as much as a $66 million increase in production costs to serve the additional 430 MW of load.
However, those costs will be offset to some degree by unlocking wind generation currently trapped in the Texas Panhandle. Integrating the LP&L system would require 141 miles of new 345-kV transmission lines — at a cost of $364 million — according to a separate ERCOT study completed last June.
Jeff Billo, ERCOT’s senior manager of transmission planning, said staff evaluated the years 2020 and 2025 with and without LP&L’s load. The analysis indicated an increase of $66 million and $60 million, respectively, in fuel costs to serve the additional load.
Billo said the final report will look at SPP’s production costs to determine the overall financial impact to the ISO. He declined repeated requests from Technical Advisory Committee representatives to discuss SPP’s preliminary numbers, saying only that the RTO’s production costs would decrease.
“Their decrease is less than our increase. That kind of makes sense, because we see an increase in the Panhandle’s export capability,” Billo said, referring to the transmission necessary to connect LP&L to ERCOT.
“We see more Panhandle wind getting to market with the Lubbock system integrated. The full cost of serving the load is somewhat offset by production-cost savings of [the] Panhandle wind,” he said.
The integration would require ERCOT to update its systems and documentation to accommodate LP&L’s 115-kV facilities. The additional infrastructure will strengthen the Panhandle system and increase transient and voltage stability and reduce congestion. The LP&L load will also contribute to ancillary services’ costs.
Left undetermined is whether the load will be in its own transmission zone or absorbed into another, which would affect the congestion revenue rights process.
Final and more detailed information will be available in the report staff presents to the ERCOT board June 13 before a filing with the PUC.
Billo said SPP is working on a parallel timeline with ERCOT and will file its own report separately. SPP said Tuesday that filing will take place with the PUC in late June.
LP&L announced in 2015 it planned to disconnect 430 MW of its load from SPP and join ERCOT in June 2019. The PUC last summer asked the grid operators to conduct coordinated studies on the move, focused on a cost-benefit analysis for ratepayers. (See PUCT Asks ERCOT, SPP to Coordinate on Lubbock P&L Move.)
