ERCOT Releases Report on Clean Power Plan, Overlooks Grid Reliability Potential

(AUSTIN – November 17, 2014) The Electric Reliability Council of Texas (ERCOT) released a report today that looks at the impact of the U.S. Environmental Protection Agency’s proposed carbon pollution standards, or “Clean Power Plan.” The Clean Power Plan is a critical step to reduce climate pollution emitted from U.S. power plants, one of the largest sources of greenhouse gases in the world.

In the report, ERCOT, which manages 90 percent of Texas’ electric grid, claims that the changes needed to electric grid infrastructure and the shift toward low-carbon energy resources pose reliability concerns. However, innovative power companies in the state are already proving that a low-carbon energy portfolio does not equal an unreliable power grid. Several electric utilities in the state have been preparing for a low-carbon future by retiring inefficient, water-intensive coal plants, installing more solar energy, and adopting more energy management programs. Today they are reaping the benefits of fixed, low energy prices, now and into the future.      

The good news is that Texas is able to deploy flexible compliance mechanisms, many of which can be added very quickly, such as energy efficiency and demand response, as well as increase the utilization of lower-emitting generation sources, such as Texas’ abundant renewable energy and responsibly-drilled natural gas. Some recent, notable clean energy milestones in Texas include:

• Austin Energy’s 150-megawatt solar energy project priced at $0.05/kWh (which is cheaper than $0.07/kWh for natural gas, $0.10 /kWh for coal, and $0.13 /kWh for nuclear);
• The Competitive Renewable Energy Zone that could lead to 7.5 gigawatts of new wind generation over the next three years and potentially up to 16 gigawatts of new wind generation over time; and  
• The 25 gigawatts of new wind projects currently in ERCOT’s planning process.

“Texas boasts one of the most competitive electric grids in the nation, primarily because it values a diverse energy portfolio and robust infrastructure. EPA’s Clean Power Plan presents another opportunity for ERCOT to lead the nation by amplifying current trends, namely harnessing more West Texas wind energy and natural gas, tapping into the state’s solar energy potential, and building out its energy efficiency programs. The Plan also offers enough flexibility for a ‘Made in Texas” solution designed to achieve much-needed carbon reductions without hindering reliability.”

“But Texas needs action today, not continued foot-dragging, to seize this opportunity and design a compliance plan that ensures the state’s energy resources are reliable and fully sufficient. Reliability of the power grid is best protected when state utility commissions and state air agencies are empowered with flexible standards to craft customized solutions. Texas needs more leadership from ERCOT to prove, once again, it has the ingenuity to implement new technologies on the power grid and keep the state humming.”

• Jim Marston, Director of EDF’s Texas Office