State lawmakers express doubt in marketplace redesign for Texas power grid

With rules now in place to prepare the power grid for bad weather, work is now underway to redesign the marketplace for the grid. 

On Wednesday, members of the Senate Business and Commerce Committee were warned about increasing the number of solar and wind generators by Railroad Commission Chairman Wayne Christian.

"Since the storm, my concern is we are building more and more of what was unreliable and nearly nothing in reliable energy," said Christian.

The Railroad Commission regulates the natural gas energy. While the gas industry remains a crucial part of the grid, interim director for ERCOT Brad Jones told the committee his focus remains on rebuilding trust.

"We are designing our market to make sure we can accommodate and bring in as much renewable as possible while still keeping the lights on when its dark and when the wind stop blowing," said Jones.

Market redesign is not expected to include plugging Texas into the national grid.  Jones said expanding out of state regional links is possible.

"What we are discussing is there is a developer who plans to bring in an additional tie of about 2,000 megawatts," said Jones.

The cost of a market redesign is a major concern for the committee. That includes the cost of requiring electric generators to have surplus fuel and who will pay for it.

"The capital expense of building the infrastructure, the storage infrastructure, its procuring fuel if you are going to keep it on site, if its fuel or diesel, it's the cost of maintaining and stabilizing that fuel," said PUC Chairman Peter Lake.

State Sen Jose Menendez (D) San Antonio wanted assurances the Railroad Commission would prevent market manipulation.

"I hope you understand that when it comes time to making sure gas gets to the generators, if that is what we are going to depend on to keep the lights on, that you help make sure that happens," said Menendez.

When the commission's authority to intervene in private contractual disputes was raised, Senator Donna Campbell (R) New Braunfels had this response.     

"I want to make sure I'm clear, I haven't heard of any agencies since I've been here that wants more regulation by the legislature, but I'm happy to take that up, thank you," said Campbell.

Senator John Whitmire (D) Houston, in questioning the head of the Texas Division of Emergency Management, expressed doubts about what's been done so far.

"What are we not being told, I guess that is the bottom line. It can't be as wonderful as this love fest is making it sound," said Whitmire.

Chief Nim Kidd answered with a warning that more work needs to be done.

"We talk a lot about efficiency in the market, and efficiency in supply chains, but that efficiency has killed our preparedness that quest for efficiency, trying to be as efficient as we can have left all supply chains in the place where there is no depth in the system anymore," said Kidd.

There are two big projects coming up in the grid redesign. One involves a special fund to help electrical providers that took a financial beating by the winter storm, and completing a map of critical pipelines. 

Both are expected by late spring or early summer.

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