ERCOT, PUC discuss summer changes to ‘improve grid reliability’

State & Regional

AUSTIN (Nexstar) — The Electric Reliability Council of Texas and the Public Utility Commission held a joint news conference Thursday morning to address “operational changes.”

PUC Chairman Peter Lake and ERCOT Interim President and CEO Brad Jones spoke for their organizations and talked about “stabilizing the grid for the summer, redesigning the market for the future, and setting expectations for the remainder of the summer.”

Within these three topics, Lake and Jones addressed people’s concerns about possible increases for ratepayers, near record-breaking energy demand expected next week and how the PUC will move forward with caution and reliability as its guiding principles.

During February’s fatal freeze, which caused more than 200 Texans to die, ERCOT functioned on a crisis-based business model where generators earned financial rewards as energy reserves nearly ran out.

“That is not a good way to run a reliable grid, and so that’s why we’re redesigning the entire thing from scratch,” asserted the PUC chairman.

“That operation at ERCOT has been turned 180 degrees around,” Lake said, noting regulators plan to put reliability ahead of cheap electricity.

James and Lake did not explain how they will incentivize companies to provide reliable energy, but they assured everyone the PUC and ERCOT are now dedicated to consistency.

“We want to incentivize the result that Texas needs – reliable electricity on an accountable basis.” Chairman Lake elaborated that, “if that takes the form of a gas plant with backup fuel storage and redundant supply, that’s more reliable. If that’s a solar array with batteries attached to it, that’s reliable and dispatchable. So, we’re driving for the result.”

One concern citizens have had since some individuals saw massive increases in their electricity bill during the winter storm is that prices will surge in order to pay for the grid reforms.

James and Lake said Texans should not expect to see their bills go up significantly.

“All in, the dollars spent so far this summer for the dramatic increases in both reserves and generators forced into service total less than $2 per person across all citizens within ERCOT,” said Chairman Lake.

During the Q&A of the press conference, many questions arose about ERCOT keeping the lights on next week when the temperature spikes and the energy demand increases.

Jones, ERCOT’s interim president, assured Texans electricity regulators are prepared for scorching summer temperatures and the potential for record demand on the system.

“Our load expectation could reach all-time highs for ERCOT,” he said, citing projections of 74,000 megawatt hours. The current record is 74,820 megawatt hours, Jones explained.

“We’re getting very close to our all-time record. As it stands today, looking at our conditions and what we expect to have next week, we expect to have a sufficient amount of generation to serve all Texans,” asserted Jones.

Chairman Lake echoed this sentiment. “It’s going to be tight for the rest of the summer. We all know the heat is coming, but we’re ready for it.”

Despite their reassurances the lights will stay on, Lake and Jones both said Texans may still receive alerts asking them to conserve energy but emphasized they are not reasons to panic.

According to the pair, conservation is a normal tool for helping the grid stay functional.

“Conservation for electricity is about the little things for a few hours at a time. It’s a simple thermostat change. It’s waiting to run your dishwasher and your washing machine overnight, instead of when you get home from work at five o’clock. It’s closing your shades and blinds. It’s the little things for a few hours, maybe a few days at a time – very much like Texas treats water conservation,” Lake noted.

This statement was in response to the week in June, when ERCOT asked Texans to conserve power for about a week as temperatures climbed in the state and more power generators than usual were offline. At no point did ERCOT have to go into emergency protocols due to the lack of power supply, but it said the grid was “stressed” since about 12,000 megawatts of power was missing from the grid.

ERCOT also asked people to conserve power in April when temperatures spiked and nearly 25% of its power generators went offline for repairs. Those were expected repairs, unlike the ones in June.

These two incidents caused the public to further doubt the reliability of the PUC and ERCOT, and these bodies understand they have a long road ahead of them until the public trusts them to keep the grid functional.

Democrats in the state are less optimistic about the grid’s outlook.

State Sen. Roland Gutierrez, D-San Antonio, believes state leaders still need to “fix the damn grid.” Gutierrez also claimed an unreliable grid is one of the most important concerns facing Texans.

“The most pressing things affecting the Texas consumer of this year and possibly of this decade, and possibly of this century, was when we lost 200 Texans,” asserted Gutierrez.

Lake said he hopes updated communication measures will help Texans be better informed and prepared during emergency grid conditions.

“We’ve got to regain their trust, and we’ve got to earn it. We’re working hard to do that through more extensive communication, more clarity in our communication, to make sure that the message that we’re sending translates clearly from a very complex grid management operation to language that everyday folks understand. That’s no small task, but we’re dedicated to this mission,” said Lake.

State Representative Chris Paddie, R-Marshall, said Republicans are impressed with the work the PUC and ERCOT are accomplishing.

“They have a lot of work to do in a very short amount of time. But as you can see, even by the end of the year, there’s going to be a lot of really substantive changes that are ultimately going to be very beneficial overall,” asserted Paddie.

That statement reflects Gov. Greg Abbott’s belief the grid has been properly addressed.

In June, a week before Texans received energy conservation alerts, Abbott said “everything that needed to be done was done to fix the power grid in Texas.”

Earlier this month, he directed the PUC to take further action to improve grid reliability.

According to a PUC press release, ERCOT has procured more than 800 additional hours of generation service so far in July, by overriding normal market functions to force power plants into action.

“This is more than any single month in recent history,” the agency wrote in the release. “The purchase of reserve power in July 2021 was up 38% year over year with the August increase projected at 56%. Most Texas customers will not see an increase in their bill as a result of this action.”

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