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Texas’ grid is at a crossroads.
Despite a statewide boom in wind and solar energy and a windfall of federal dollars to support battery storage technology, Texas regulators are moving forward with an untested plan that could add more natural gas to its power grid, writes POLITICO’s E&E News reporter Jason Plautz.
The push comes as the nation’s top energy-producing state struggles to shore up its grid after a deep freeze in 2021 led to rolling power outages and the deaths of more than 200 people.
A storm near the end of last year also saw some renewable and natural gas resources go offline, though the lights stayed on thanks to some reliability improvements.
And the risks are only mounting. Demand for electricity in Texas is rising as the climate crisis threatens to bring more extreme heat and cold, further straining the grid. The fact that Texas’ grid is isolated and does not share energy resources with other states only heightens its vulnerability.
State regulators have proposed a framework that would create a novel system for adding power sources like natural gas, nuclear or battery storage to the grid during times when demand is high and planned supply is running out.
It would require electricity companies to buy credits from power generators for the hours every year that demand exceeds supply. That would offer generators additional revenue to invest in energy sources that could be tapped in any kind of weather, including new or existing fossil fuel power plants.
Skeptics fear that the plan could raise prices for consumers without guaranteeing reliable power during a crisis. Plus, the mechanism has never been used before, which has some analysts worried and other critics downright irate.
“It’s unacceptable,” Republican state Sen. Charles Schwertner said on Twitter. He called the market redesign “a costly and complex proposal that is unlikely to deliver the dispatchable generation resources that Texas needs.”
The market analysts who initially proposed the new mechanism said that wind and solar would continue to grow under the plan, making up 50 percent of Texas’ power supply by 2026. But some environmental groups contend that the proposal offers a cash cow for long-standing fossil fuel producers that won’t actually fortify the grid.
The plan is nowhere near final. It still requires approval from the state House and Senate, where — if Schwertner’s tweet is any indication — the reception may be frosty.
It’s Monday — thank you for tuning in to POLITICO’s Power Switch. I’m your host, Arianna Skibell. Power Switch is brought to you by the journalists behind E&E News and POLITICO Energy. Send your tips, comments, questions to [email protected]
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That’s it for today, folks! Thanks for reading.
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