For decades, the PUC has held two meetings per year focused on energy efficiency in Texas. Today’s meeting of the Energy Efficiency Implementation Project (EEIP) will be the first one led by the new Energy Efficiency Division of the PUC. 

At the meeting, Texas A&M researchers will present findings of their study (conducted for ERCOT) showing that a large-scale push to install high-efficiency heat pumps and insulation in Texas homes could reduce winter peak demand by 23,000 megawatts. That might have prevented the traumatic outages Texas experienced three winters ago — during Winter Storm Uri, ERCOT initiated over 20,000 megawatts of load shed. 

The report shows that any serious reliability push demands a strong, comprehensive energy efficiency strategy: it’s the difference between catastrophe and an uneventful winter storm…

Texas’ summer of 2023 was memorably excruciating. It was the second hottest summer in Texas history, behind only the inferno that was 2011. Over 61 days last year, Texans endured statewide highs of 105 degrees.

Unsurprisingly, the state’s power reserves were strained. On average, outages of “dispatchable” thermal power plants — those running on gas, coal, or nuclear — were 70% higher than ERCOT expected. On seven days in 2023, thermal power plants exceeded what ERCOT calls “extreme” outage levels.

Texans know too well that gas and coal plants are not always dispatchable as they pretend to be. Their rate of unavailability skyrockets when they’re needed most: during extreme heat and cold…

Texas has a far more diverse economy than it did in the 1980s, when an oil bust shattered the state’s economy. But Texas is still vulnerable to lower oil prices, and lower oil prices are here. It looks like oil prices may go lower still. 

The looming crunch is another reminder that the state still needs to do more to diversify its energy industry and workforce. Happily, we have a great start.

According to a new report from the US Department of Energy, Texas added more renewable energy workers than any other state — and passed 50,000 total renewable energy workers — in 2023…

The vast majority of power outages happen on the distribution side of the grid: think downed power lines or blown transformers that knock out power for thousands or even millions of people, but that don’t create the statewide misery of 2021’s Winter Storm Uri.

But Texas policymakers put most of their focus — and billions of Texans’ taxpayer dollars — focused on subsidizing new gas supply, even though they wouldn’t help after a hurricane or in advance of wildfire and the inability to produce and move gas was the biggest cause of Winter Storm Uri…

All of the problems plaguing the Texas grid are solvable — and those solutions necessarily require technology, policy, and people. 

In recent days I've covered technology and policy solutions; today, let’s talk about bringing people into the process. 

People, after all, are the reason the grid exists: of course outcomes will be better if those who count on the system are able to help improve it. However, the opposite is also true: exclude people from the process and outcomes will be less than optimal. 

The Texas power grid demonstrates this maxim in the worst way. Leaders consistently undervalue and ignore opportunities to engage and gather input on energy policy and regulations from Texans and Texas communities. Not coincidentally, Texas consistently ranks in the bottom third of states on reliability and affordability. 

The botched Hurricane Beryl response is a yet another example of what happens when regular people aren’t included in decision making on these issues. Without power to shape the grid, too often people find themselves without power from the grid…

The Senate asked pointed, often agonizing questions yesterday of CenterPoint Energy executives and a range of local officials; testimony went on for ten hours. There were many apologies, more anger and frustration, and even some substantive policy discussions. 

Tomorrow, it’s the House’s turn. Then officials will have to take on the really big questions: 

Will anything actually change? 

And if so, what and how?

For Texans, the tragedy unfolding in Houston is increasingly, and tragically, familiar. A blast of extreme weather rolls through, knocking out power for, in this case, millions of people.

The focus right now is getting lights and air conditioners back on in the wake of Hurricane Beryl. CenterPoint just told the PUC that over a million people are expected to remain without power next week. In Houston and beyond, Texans are asking why it’s taking so long and what went wrong. Those questions need to be answered with far more speed and transparency…

Ten years ago, Texas mined 50 million tons of coal per year. Today, that’s down 60%, to 20 million tons.

Meanwhile, compared to a decade ago, Texas produces ten times as much wind, 50% more gas, and a hundred times more solar power.

Texas also currently has 500,000 energy jobs — that number will continue to grow long after coal is no longer mined or burned anywhere in Texas or the U.S. In fact, it’s likely that after coal production ceases, Texas will gain jobs because the dirtiest fuel around will be replaced by gas and renewables, all of which Texas produces more of than any other state.

In April, the EPA released four rules to reduce: greenhouse gas emissions; mercury and air toxics; unsafe toxic waste disposal and radioactive coal sludge; and water pollution from coal plants — these are nasty, dangerous pollutants, and Texans would obviously be better off without them.

Thing is, the Texas energy industry would be better off as well, given our abundant mix of natural resources including wind, solar, geothermal, and gas.

This should be an area where our state’s renewables and oil and gas industries should agree: coal’s loss is Texas’ gain…

This Thursday at noon looms as a key deadline for anyone who cares about Texas’ ability to have a reliable grid.

We’ve known for years — since long before Winter Storm Uri in 2021 and summer energy alerts in 2022 and 2023 — that the state needed to do much, much more to reduce energy waste and increase demand flexibility. Increasingly intense summer scorchers and winter blasts trigger air conditioners and heaters to kick into high gear, taxing the ERCOT grid already straining to meet demand.

Thursday is the PUC’s deadline for responses to a list of questions about what Texas can do to optimize energy use in ways that fortify homes and buildings against extreme weather, reduce the risk of outages, and lower energy bills. It comes after the Legislature last year required the PUC "by rule" to "establish goals in the ERCOT power region to reduce average total residential load." 

Governor Abbott signed the bill over eleven months ago, yet the rulemaking process hasn't even started. Hopefully, the PUC questions will be a prelude to a rulemaking. 

Here’s a look at some of what they're asking…

As Texas grows — and Texas electric demand skyrockets — transmission issues will become increasingly critical. Over the next few months, I’m going to write a series of articles about transmission needs, including pieces on ERCOT’s management of the existing system and the need for more transmission.

For today though, I want to focus on an important technological upgrade that could quickly and significantly increase ERCOT’s capacity to move power around our state…

This month, ERCOT released a staggering projection: the agency says 62 gigawatts of new demand could plug into Texas’ grid by 2030. 

It looks like a decimal point got lost somewhere. The state’s all-time demand record is 85.5 gigawatts, and it took a century to get there. ERCOT says that could jump 72% in a little more than five years.

Texas simply isn’t going to build that much gas generation — there’s no way to build even a fraction of that and even if we could, consumers couldn’t possibly afford it. But there is a way to serve all of that demand and increase reliability at the same time…

ERCOT’s risk of blackouts comes down to two basic factors: supply and demand. 

On the former, markets and policies are making progress — investors are developing solar power and dispatchable energy storage in ERCOT at a record rate. Texas is expected to get another six gigawatts of battery storage in 2024 alone. Solar is being deployed even faster, with seven gigawatts expected this year, padding the state’s resources when use peaks during summer afternoons. And there are currently over 15 gigawatts of natural gas in the ERCOT interconnection queue.

But skyrocketing demand could overwhelm all of that new supply, and then some…

On the evening of Sept. 6 last year, ERCOT declared an Energy Emergency Alert for the first time since February 2021. Frequency dropped to dangerous levels, and ERCOT was close to ordering rolling outages. But batteries surged to an all-time record, narrowly staving off a catastrophe.

On Sept. 7, I posed a series of questions about the incident and the grid more broadly. The last was this: “Perhaps most importantly, are there strategies they can implement to prevent this kind of curtailment in the future?”

ERCOT and the PUC are only just now seriously discussing the solutions. The situation couldn’t be more urgent…

Houston’s annual CERAWeek calls itself “the world’s premier energy conference” — and it is. Thousands of energy CEOs and executives are there. Industry observers and media treat CERAWeek as a barometer for where energy is headed. 

Combative and provocative comments always get lots of attention. This year, as always, a few oil and gas executives were happy to provide them. But make no mistake: the overriding theme of the conference — even, or especially, among oil and gas industry leaders — was the day-to-day economic importance and market opportunities of a “multidimensional energy transition.”

And there was no mistaking Texas’ role in leading it…

At this morning’s PUC Open Meeting, the commissioners will discuss the Performance Credit Mechanism, or PCM, which I have described as Pretty (much a) Capacity Market.

In a memo filed yesterday, Chairman Gleeson laid out three questions for the commissioners to discuss:

Are they ready to set dates for workshops? (The first is already set for March 26)

Should the cost cap set by the Legislature be annual or a yearly average? (The law unambiguously says “annually,” page 25, line 8)

Should the ERCOT filing from last week “be the ‘implementation plan’ required by the Commission’s Order and Modified Memorandum adopting the PCM?”

The Legislature put guardrails (including the annual cost cap) on the PCM but did not require it be implemented. A Commission order can be easily set aside by another Commission order; they are not obligated to proceed.

They need to consider at least a few extra questions…

Last week, I wrote about Sam Insull’s innovation with time-of-use rates. His other big innovation was the monopoly business model for utilities, which he first proposed in 1898 and was ubiquitous in the U.S. just 15 years later.

Under that model, utilities earned guaranteed rates of return on every dollar. It was a good deal for the country because it attracted massive amounts of capital and helped rapidly electrify America’s cities (rural areas would come later in the New Deal with the advent of co-operatives).

But those guaranteed returns are becoming harder to come by. The wildfires now raging in the Texas Panhandle demonstrate that the monopoly utility model suddenly faces stiff headwinds — many driven by fossil-fueled climate change. 

A Texas homeowner has already sued Xcel Energy, accusing the mammoth utility of starting the Smokehouse Creek blaze, the biggest wildfire in Texas history. Xcel has monopoly utility status and territory in eight states, including in the Texas Panhandle…

For more than a generation, ERCOT’s competitive electric market has propelled Texas’ energy innovation and leadership — and, at least until recently, generally kept Texans’ electric rates low.

But things are changing rapidly on the grid, and costs are skyrocketing. State leaders are considering abandoning the competitive electric market in favor of state-owned generation and centralized control of the grid. 

That’s unnecessary and counterproductive.

To understand what’s happening and where we’re headed, it helps to know how we got to where we are. To better understand the system we have today and some of the most promising solutions to our current grid problems, you should get to know Sam Insull…

As Winter Storm Uri blacked out much of Texas on Feb. 15, 2021, Texans erupted in outrage that such a catastrophe could happen here. 

In the ensuing days, Texans learned, painfully and publicly, about grid recommendations made by federal regulators after outages in winter 2011. These recommendations, largely ignored by state officials, could have significantly lessened Texans’ pain and damages from the 2021 freeze.

In the three years since Uri, in some cases, state leaders have taken steps to protect the grid and the people who rely on it. But in others, Texas is making some of the same disastrous mistakes it did after 2011.

In November 2021, the North American Electric Reliability Corporation (NERC) and Federal Energy Regulatory Commission (FERC) issued a 300-page report on the Uri blackouts. The report included 28 common-sense, far-sighted recommendations designed to prevent or mitigate such outages in the future. The agencies urged Texas to implement the recommendations by this winter, if not sooner. 

Today marks three years since Uri killed hundreds of Texans, blacked out millions more, and wreaked havoc on the state’s power grid, water systems, and economy. 

Here’s a look at which recommendations have been implemented — and, more disturbingly, those that haven’t…

Last week, the PUC, in one of new Chair Thomas Gleeson’s first acts, declared Phase 1 of the ERCOT market redesign to be over. 

Good riddance.

Phase 1 was a tortured effort that resulted primarily in higher costs for beleaguered Texas consumers. Yes, the state avoided supply-driven blackouts — but then again, that happened in the decade before 2021’s Winter Storm Uri as well.

The bigger question is whether the PUC can ensure higher levels of reliability without squashing the Texas economic miracle — that is, without sharply increasing costs to the point that residential and small business customers face shut-offs, or that the manufacturers Texas covets start looking elsewhere to build, expand, and hire…

This is the dawn of the distributed energy era. There are already millions of devices in homes and businesses that can respond to signals — and turn on and off — in times of abundance or scarcity. 

Soon, many gigawatts of distributed energy will be scattered in the batteries of millions of electric cars, trucks, and buses, and will be generated from rooftop solar panels and stored in powerwall battery units. 

But distributed energy also means demand management. Energy will go further as high efficiency heat pumps replace aging, inefficient electric heaters and blackout-inducing resistance heat — these and other devices also will respond to signals to power down when electricity is expensive and they aren’t needed, then come back online when it’s cheaper and more plentiful…