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The Public Utility Commission met on March 31 to take up a number of items. The commission considered agenda item 25 relating to addressing distributed battery energy storage interconnection and policies. Additionally, the commission discussed rate change applications, cessation of water service, review of wholesale market design, among other items. An agenda to the hearing can be found here.

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.

 

The following items were consented upon: 2, 4, 9, 10-15, 17, 19, 22 and 28

Agenda Item 1: Public Comment

  • No public comment

 

Agenda Item 5: Docket No. 49337; SOAH Docket No. 473-20-2280.WS – Application of Woodland hills Water, LLC for Authority to Change Rates

  • McAdams – Woodland hills is an important case; this is a Class B utility and is an ongoing case of about three years
  • Business plan contemplates an affiliate relationship between Woodland hills and Aquatec
  • Woodland hills has a contract with Aquatec; there is about a 15% adder to all the invoices and a pass-through cost from the San Jacinto Water
  • Not sure if Aquatec counts as an affiliate and the 15% mark up is not a fair rate of return
  • This class b has not asked for a good cause exception; and did not notify OPUC per notification requirements
  • Recommends not approving the application
  • Cobos – This case is a flagrant disregard of the commission rules and the Water Code; is not a position OPUC needs to put themselves in
  • Lake – All cases need to include OPUC early enough so they can do their job; not doing so would be immediate grounds to stop the process
  • Glotfelty – In total agreement
  • Cobos – Recommends utility not recover rate case expenses and they go back to charging their optional rates and tariffs
  • Lake – Agree; will add that language to the denial of the application
  • Motion to deny the application passes

 

Agenda Item 6: Commission Staff’s Application for an Order Appointing a Temporary Manager to Tawakoni Wastewater Treatment Plant

  • PUC Staff – Staff filed a recommendation to terminate the temporary manager Troy Henry and commission approved its sale to the Sabine River Authority in 2020, so it has a new owner
  • Motion to terminate temporary manager passes

 

Agenda Item 7: Petition of Lake Livingston Water Supply Corporation for Approval of Cessation of Water Service to Sam Houston Lake Estates in Liberty County

  • PUC Staff – Have a memo with proposed changes to the order
  • Lake – Has been a unique challenge with this case; had to balance leaving customers hanging and mitigating flood risks in the community
  • McAdams – Options are limited here; need to know if these customers are still being served; are playing clean up in clarifying the utility’s role
  • McAdams – Need to proceed cautiously; are paving a new role by actively endorsing a plan to deny service so need to be narrow in purpose
  • Cobos – Agree; need to contrast property rights and essential services with flood planning
  • Lake – If we can accommodate the four connections in this plan, need to be comfortable these connections will receive essential services
  • Glotfelty – Struggle to tell a utility to discontinue services; pen to allowing the decertification if we get more information on what the other emergency services and the county will provide
  • Glotfelty – Is an onus on the homeowners because they are the only ones who are staying in a hazardous area
  • Commissioners discuss they need to ask the utility/county: if the buyout program is in place, will service continue to be given to those connections, what the state of their county roads are, how many active connections remain, how these homes are getting water
  • PUC Staff will compile these questions for the county and utility

 

Agenda Item 8: Application of Dos Aguas, LLC for a Water Certificate of Convenience and Necessity in Walker, Montgomery, and San Jacinto Counties

  • PUC Staff – Commission previously denied the application and this is a motion for rehearing on this order
  • Lake – A lot of work has been done to this application
  • McAdams – Glad more information is forthcoming; potential utility has taken feedback to heart
  • Cobos – Would grant rehearing and remand the case back to further processing; need to clarify the number of connections and would limit the review to Water Plant 1
  • Cobos – The utility could come back for Water Plan 2 and Water Plan 3 in the future
  • Lake – Developer had done a lot of the work we had asked for, but was not in the record
  • Motion to grant rehearing and remand case passes

 

Agenda Item 20: Application of Golden Spread Electric Cooperative, Inc. to Change Wholesale Transmission Service Rates

  • PUC Staff – Draft order was filed and Lake has filed additions to the preliminary order
  • Lake – Need to ensure we ask about large expenditures outside of the normal course of business; is not a prejudgment, but need more information
  • McAdams – Supports this ask
  • Lake – Have seen the other side of transmission operator issues, so need to ask these questions
  • Motion to approve additions to the preliminary order passes

 

Agenda Item 21: Agreed Notice of Violation, Agreement, and Report to the Commission Relating to Commission Staff’s Investigation of NRG Texas Power LLC Concerning Violations of PURA § 39.151(j), 16 TAC § 25.503(f)(2) and (f)(8), and ERCOT Nodal Protocols §§ 6.4.6(1), 6.5.5.2(7), 6.5.7.5(2), and 8.1.1.3(3)

  • PUC Staff – Have a memo with proposed changes to this order
  • McAdams – Is no broad reflection on NRG; need to look at resource market events involving units bidding into ancillary services
  • McAdams – Operator error and software anomalies need to be looked at and a more rigorous enforcement policy is being pursued
  • Commissioners support the proposed order
  • Motion to adopt proposed changes to the order passes

 

Agenda Item 25: Review of Wholesale Electric Market Design

  • Glotfelty – Has written a memo on this item; have moved away from interconnection agreements process timeline cost allocation
    • Excerpt and link to Glotfelty memo: “As of 3/28/2022, there are 36,000 MWs of utility scale Solar + energy storage systems and over 31,000 MWs of stand-alone storage in the ERCOT Interconnection Queue. This is a massive number of new megawatts that could fundamentally change how our system works in ERCOT. Unfortunately, it is unknown how many megawatts of battery storage are seeking to interconnect to the distribution systems across ERCOT’s utilities, municipal utilities and electric cooperatives. The lack of visibility into these distribution system assets is an oversight.”
  • Glotfelty – Need to ensure all types of MWs are available; need to get everyone in the room and address issues at the distribution level
  • McAdams – Scope of the project should include distributed generation and distributed energy resources; could allow to feedback from utilities like IOU TDUs and NOIEs
  • McAdams – Need to allow grid and system operators have access to resources
  • McAdams – Could be built into resource adequacy metrics and be built into reviews of these costs in rate cases; project will be a good time to discuss this with utilities
  • Cobos – Will benefit from this opportunity and these resources; is still work to be done at ERCOT
  • PUC Staff – Will work with Glotfelty on planning this and will bring it back to the commission

 

Agenda Item 27: Middle Mile Broadband

  • PUC Staff – Will allow electric utilities to lease out excess fiber capacity to ISPs to provide broadband to underserved areas of the state
  • McAdams – Will be an opportunity to look at communications adequacy
  • Cobos – Will be an asset especially to rural Texas
  • Glotfelty – Do we get any reports back on any of the utilities who lease this fiber?
    • PUC Staff – Is an “odd” regulatory regime; commission has to be involved so electric rate payers are held harmless and would come on the back in with a rate case
    • PUC Staff – Could do some work on the back end to get utilities to discuss their successes
  • Motion to adopt the proposal passes

 

Agenda Item 37: Request for Proposals for Consulting Services Relating to the Electric Market Design Blueprint

  • Motion to approve the proposed order passes

 

Agenda Item 38: Review of Chapter 28 – Rules Applicable to Cable and Video Service Providers

  • PUC Staff – Commission has a proposal for publication
  • Motion to approve the proposal for publication passes

 

Agenda Item 39: Discussion and possible action regarding agency review by Sunset Advisory Commission, operating budget, strategic plan, appropriations request, project assignments, correspondence, staff reports, agency administrative issues, agency organization, fiscal matters and personnel policy

  • Executive Director overviews staffing changes

 

Commissioners met in a closed session and no actions were taken