May 30, 2013 – Austin, Texas
Policy
Just when you thought it was safe to come out…..
It’s been only a few days since legislators departed sine die—the official end of the 83rd Texas legislature, but the issue of resource adequacy is far from resolved. With summer heat moving into high gear, the focus will once again turn to the Public Utility Commission (PUC) where meaningful discussion about the sufficiency of generation supply now and for the next few years has ebbed. But as we approach the scorching summer months, we expect a third PUC Commissioner to be appointed while the debate reheats at both the PUC and ERCOT about how to effectively incentivize sustained reliability.
So as we all prepare to enjoy the summer outside, the key energy question is how will our market evolve given that notable experts disagree on what needs to be done to ensure reliability and affordability. While former FERC and PUC Chair Pat Wood has said, , current PUC Commissioner Ken Anderson argues that
On the legislative front, the regular session is behind us, but lawmakers haven’t left Austin just yet. On Monday, Governor Perry called a special session on redistricting. Whether the governor will add more items will be added to the lawmaker’s plate remains a mystery at this time.
All told, lawmakers passed 1046 bills during the 2013 session. So far, Governor Perry has signed more than 190, vetoed two and let four go into effect without his signature. One of the bills that will go into effect without the Governor’s signature is the PUC sunset bill, HB 1600 by Cook. This sweeping legislation, among other provisions, granted the PUC additional regulatory duties for water and sewer, expanded the agency’s authority over ERCOT and added new qualifications for PUC commissioners.
On the water front, Governor Perry signed HB 4 on Tuesday signaling what advocates hope will be a new era for Texas as the state, despite recent rains, continues to struggle with drought. Voters, however, will have the final say in November about whether to amend the Texas Constitution to create two water infrastructure funds (SJR 1). If Governor Perry signs HB 1025, the state will have immediate access to $2 billion from the Rainy Day Fund to kick start regional water projects, but some say that he may veto the bill and put the entire decision in the hands of voters. The Water Development Board will also look a lot different in the future with three paid administrators (appointed by the governor) replacing the current six-member appointed board.
In other legislative news, the Texas Railroad Commission was reauthorized for four more years, although the Sunset Commission will continue to look at assigning its duties to other agencies in the future. If the governor signs HB 7, the sometimes controversial Systems Benefit Fund, which was created in 1999 after electric deregualation, will stop collecting its surcharge in September and distribute the balance of the fund to low-income Texans in the form of rebates for the next few years.
People
In the pressure cooker: Can ERCOT take the heat?
One of the unique aspects of our great state is that we have our own independent electric grid operator, the Electric Reliability Council of Texas (ERCOT), a 501 (c) 4 membership based nonprofit that manages scheduling on the electric grid used by 23 million Texans. ERCOT, subject to oversight by the Texas Legislature and the PUC, is governed by a comprised of energy industry leaders representing the many segments of the electric power market.
As temperatures begin to rise this summer, all eyes will be on ERCOT as the key arbiter of reliable, affordable electricity that powers 85% of our state’s load. Will our electric power continue to be affordable? Will our electric power be reliable this summer or will be have more blackouts? What will the future management of our electric grid look like to ensure both reliability and affordability? These are the questions that ERCOT will face in a time of very limited energy resources.
In case you missed it, here is a link to ERCOT’s forecast on resource adequacy for the hot 2013 summer:
Programming
Final Issue Brief Released Today
Power Across Texas is proud to release its final Issue Brief on Resource Adequacy. This Issue Brief is the last in a series of seven briefs that were developed by the Power Across Texas team during the 83rd Legislative Session to educate elected officials, legislative staff, members of the media and general public about the critical energy issues facing our state. Previous 2013 Issue Briefs covered a range of key energy topics, including Electric Generation Mix,Fracking, Texas Energy Regulation, Texas Deregulation Nuts & Bolts, Texas Electric Grid Management and Texas vs. EPA.
Stay tuned to the latest in resource adequacy conversations through PAT updates, features, and events available on our website (poweracrosstexas.org) and be sure to follow us on twitter @PowerAcrossTX .
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