Public Utilities Commission’s recommendation to change the electricity market sparks controversy at the Capitol

Austin (CBSDFW.COM) – Some state legislators have criticized a plan recommended by the Texas Public Utilities Commission to improve the reliability of the state’s power grid as the population grows.

Although the PUC does not implement the plan until after the legislature weighs it, it is controversial in the Capitol.

“I am deeply concerned.”

The PUC favors what is called a performance evaluation mechanism, or PCM.

Experts say the program is designed to provide additional payments to power plant operators who will be ready to produce electricity whenever the grid needs it.

These extra payments or performance credits will eventually be paid for by Texas taxpayers, but no one knows exactly how much that will cost.

Patterson, who has been an electricity and natural gas broker for large enterprises for 17 years, said: “This market structure has never been used before in any electricity market in the world. So that in itself is a big risk. these complexities mean that with this market structure it will be more expensive for the end consumer.”

State Senator Nathan Johnson, Dallas, said Friday he wants to give the proposal a shot. “I really think it’s worth continuing. Models have existed all over the world for a long time. All of them have problems. PCM, the Performance Credit Mechanism, is an attempt to create a mechanism that takes advantage of these other systems and eliminates some of the disadvantages.”

In a tweet Thursday, State Senator Charles Schwertner R-Bryan, author of SB 3, a key two-year-old bill designed to stabilize the grid, objected to the proposal. “The Texas PUC chose to ignore a clear direction from the Texas Legislature by voting to replace the state’s competitive energy market with a costly and complex proposal. This is unacceptable”.

Patterson said: “Absolutely, I agree with that. The Texas Legislature never set out to completely change everything about our market, everything that has made our market as successful as it has been.”

A spokeswoman for the PUC issued a statement late Friday night in response to Schwertner’s tweet. “Given the significant interest in the PCM and its associated guidelines, yesterday’s decision reflects the Commission’s commitment to continue to work with legislators, stakeholders and the public and allow time for legislative changes to be made before the implementation process begins.”

Governor Greg Abbott, who oversees PUC, sent the agency a letter last week saying his proposal would help make the network more reliable. “As legislators have pointed out, the standard of reliability must underlie any design of reliability. PCM best meets this requirement.”

Patterson said the state needs more nuclear or natural gas power plants to power the state’s growing population.

He and other energy experts said federal subsidies have made wind and solar power cheaper to produce than electricity generated by thermal power plants, discouraging the construction of new power plants in Texas.

Johnson said that while he couldn’t disagree, batteries are also being made that can store solar and wind power for emergency use when the sun isn’t shining or the wind isn’t blowing.

While everyone agrees that the state needs to figure out how to accommodate all of the new businesses and residents moving to Texas, Johnson said there’s no general consensus on a plan to do so.

He said it was a critical condition and industry leaders agreed. “A lot of that depends on the willingness of the investment community, the electricity generation investment community, to see Texas as a stable, good investment. We must have it. the whole economy.”

Schwertner promised that the Senate would hold hearings on the matter in the coming months.