This op-ed is part of a series published by The Dallas Morning News Opinion section to explore ideas and policies for strengthening electric reliability. Find the full series here: Keeping the Lights On.
More than two months have passed since the devastating winter storm that left millions of Texans without power. The prolonged cold snap was historic, and in many ways it was a perfect storm, something that dramatically and tragically exposed the vulnerabilities in all levels of Texas’ energy system.
Perhaps unsurprisingly, the finger-pointing began immediately. Many seem eager to blame one energy resource or another, while others are taking aim at insufficient infrastructure investments. The truth is, failures across the board got us into this mess. What will get us out of it is reinvestment in a system that prioritizes delivering affordable, reliable power to all Texans.
Competitive power markets like the Electric Reliability Council of Texas, which is responsible for 90% of Texas’ power load, are a key tool to encourage efficient economic investment that helps to keep consumer prices low and reduce greenhouse gas emissions.
Since 2001, competitive markets have served Texas well, helping lower emissions and keep prices affordable for consumers. While the recent and unprecedented winter storm exposed weaknesses in the operational, technical and planning components of the state’s power system, state leaders should prioritize addressing those specific flaws, rather than blaming the competitive market and ERCOT for everything.
After all, these markets have spurred efficient and economic investment in power-generation capacity for decades. And with thousands of people moving to the Lone Star State every day, power providers will need to continue to invest in new generation to meet growing demand. Sticking with a competitive power market is the best way to help the state achieve its reliability and climate goals at the lowest cost to consumers.
A competitive system provides Texans the option to choose the power providers that meet their energy needs and reflect their individual preferences. For some, cost may be a primary concern, while other households may prioritize zero emission resources and other benefits.
The competitive market pushes electricity providers to innovate in these and other areas to win customers. Not only does it create the need for power generators to compete on price, it also pressures them to innovate to operate as efficiently as possible, with benefits for consumers and the environment.
As market signals push power suppliers to improve their efficiency by retiring older generation plants and investing in newer, more cost-effective technologies, they are also helping make power generation fleets cleaner and more efficient. Private investors have made major investments in recent years. For example, between 2016 and 2020, utility scale solar systems in ERCOT, which are particularly useful in meeting our summer peak demand, went from 289 megawatts to over 3,800 megawatts.
These new investments help improve reliability while also reducing the power sector’s environmental effects. Texas energy providers have the lowest nitrogen oxide emissions in the region, and the NOx , sulfur dioxide and carbon dioxide emissions in Texas are below the national average.
Meanwhile, ERCOT continues to develop new grid advancements to better optimize the use of a variety of generation to meet forecasted demand growth. ERCOT is also working to help companies integrate battery storage into the grid. These and similar technologies will be key parts of the grid of the future.
As we think about how to expand and improve the electric grid for the future, it’s important to both learn from past mistakes and to adopt policy solutions that fix flaws without throwing the metaphorical baby out with the bathwater.
All players in the Texas energy landscape, both on the electric and natural gas side, bear responsibility for what happened and for enacting reforms and system improvements to ensure that the electric grid is prepared and equipped to better withstand extreme winter weather events. Going forward, preparation will be crucial for both power supply and critical infrastructure.
But as state policymakers sort through the evidence and try to develop concrete ways of fortifying our grid against future extreme weather events, it is important to recognize the benefits that the competitive power market has brought to the state.
Texas’ competitive power market helped to turn the state into the nation’s top energy producer and has spurred important energy investments. While February’s deep freeze is a clear sign that the grid and its interdependencies need to be reassessed, an overhaul of the entire system and market structure that moves away from competition is not the answer. Now the task before the industry and its regulators is to make sure these mistakes are corrected, so that Texas’ economic future continues to be a bright one.
Kenneth W. Anderson is a former Public Utility Commission of Texas commissioner. He wrote this column for The Dallas Morning News.
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