On March 9th Lt. Governor Dan Patrick started the Powering Texas Forward press conference pointing out there were 9 bills with bi-partisan support to address electric reliability. Governor Patrick was surrounded by eight senators from the Senate Business & Commerce Committee as he laid out Chairman Schwertner’s bills, as well as Senator King’s bills.
This report is intended to give you an overview and highlight of the discussions on the various topics taken up. It is not a verbatim transcript of the discussions but is based upon what was audible or understandable to the observer and the desire to get details out as quickly as possible with few errors or omissions.
- Patrick – Proud of bi-partisan support for 9 bills that Schwertner and King will be laying out today
- Patrick – To make sure Uri outcomes never happen again, not a move to a capacity market but work with PUC to take best of PCM plan and working with stakeholders to balance and incentive for more thermal power to be built
- Schwertner – Starting point of powering Texas Forward, points out several bills from last session that made positive changes
- Schwertner – need to address operational flexibility and resource adequacy
- SB 6 – ensures more power will be on Texas Grid 10k MW, establishes energy insurance program, and supports and maintains current dispatchable with state back low-cost loan program which is similar to SWIFT; a backup system so Texans can be reassured
- SB 7 – addresses market distortions of federal credits, intermittent and firm generation costs balance by making sure everyone is contributing equally and adds new ancillary service (DRRS – day ahead ancillary service)
- SB 2010 – bill for market protections to address violations with enhanced reporting
- SB 2011- bill for addressing voluntary mitigation plan requirements
- SB 2012 builds off work of PCM, add guardrails and provisions that make sure rate increases are manageable and increases reliability
- SB 2013 gird infrastructure protection bill, build off Lone Star Protection Act
- Will work with all (i.e. both parties, House and Senate) to ensure we have power necessary to power homes for generations to come
- King – excited about Hunter’s work to help put together package as well, echoes Schwertner’s comments about working with all
- SB 1287 – line item on electrical bill for transmission and distribution, cost gets paid by consumers in current market, King provides examples of interconnection costs; bill will put PUC cap on amounts Texans will pay when new generation is tied into grid and cost above those are borne by company
- SB 2014 – still pay a direct subsidy for renewable generation, it is a mature market today so no reason to pay for subsidy; bill eliminates subsidy
- SB 2015 – requires that in 2024, at least 50% of all new generation built in EROCT area must be dispatchable
Questions and Answers
Q: Against PCM? Is the PCM effectively dead?
A: Schwertner – PCM is a valid idea, DRRS is complimentary and believes they work in harmony
Q: SB 2014 is about discouragement of renewables
A: King – they already exist, federal dollars already addresses, this is just about subsidy
Q: SB 7 do you want to focus on dispatchable energy more than renewable energy
A: Schwertner – that is correct, need dispatchable generation to ensure balance and will perform during critical time
Q: Mature renewable energy in Texas, is that the future?
A: Schwertner – need generation that will perform when necessary, when weather is extreme, federal legislation incents more solar and wind and closing in on 50% of portfolio being renewables
A: Schwertner – firming requirements, targeted dispatchable will turn dial back to rebalance of dispatchable vs non-dispatchable
Closing Remarks
- Patrick – not enough gas, coal or nuclear if sun not shining or wind stops blowing, don’t want to go the way of other states that lose sight of dispatchable needs, have invested heavily in renewables and need to focus now on dispatchable
- Patrick – incentives of investment are about getting everyone on the same playing field
- Patrick – a SWIFT fund for loan interest loans to build plants, Texas could loan money at 1% and they are building plant with cost at 7%..tremendous savings that could be passed onto the rate payer
- Patrick – This plan will take several years, why we need to start now this session