An overview of the structure of the competitive electric market in Texas, as well as an update on generation investment, transmission & distribution investment and retail performance in the market.
The document provides an overview of the electric industry in Texas, including:
- Texas' electric system is divided among four reliability regions overseen by NERC and FERC.
- AECT represents investor-owned electric companies in Texas across generation, transmission, distribution and retail.
- Member companies operate under different business models including vertically integrated utilities and competitive generators and retailers.
- The types and mix of generation resources in Texas are discussed along with benefits, challenges and environmental impacts.
The document provides an overview of electricity operations and member companies of the Association of Electric Companies of Texas (AECT). AECT is an advocacy group composed of electric companies committed to ensuring reliability, supporting competitive markets, and promoting economic and environmental goals. The document outlines the eight reliability regions in the US, including the four regions that cover Texas, and profiles 16 AECT member companies, including generation, transmission, distribution and retail companies.
The document provides an overview of electricity operations and recent statistics. It discusses how the US is divided into eight reliability regions overseen by NERC and FERC. It outlines the principles of the Association of Electric Companies of Texas (AECT), which advocates for a modern and reliable electricity infrastructure, efficient competitive markets, and consistent regulation. The document then lists and provides brief descriptions of AECT member companies operating in different reliability regions and market structures in Texas.
An overview of the structure of the competitive electric market in Texas, as well as an update on generation investment, transmission & distribution investment and retail performance in the market.
The document provides an overview of the electric industry in Texas, including the members of the Association of Electric Companies of Texas (AECT). AECT members include electric generation companies, transmission and distribution utilities, and retail electric providers. The document discusses the different types of AECT member companies and their roles in electricity operations in ERCOT and other regions of Texas.
The document provides an overview of electricity operations and member companies of the Association of Electric Companies of Texas (AECT). AECT is a trade organization composed of investor-owned electric companies in Texas committed to ensuring a reliable electricity supply. The document describes the different types of AECT member companies including transmission and distribution utilities, generation companies, and retail electric providers.
The document provides an overview of the electric industry in Texas, including:
- Texas' electric system is divided among four reliability regions overseen by NERC and FERC.
- AECT represents investor-owned electric companies in Texas across generation, transmission, distribution and retail.
- Member companies operate under different business models including vertically integrated utilities and competitive generators and retailers.
- The types and mix of generation resources in Texas are discussed along with benefits, challenges and environmental impacts.
The document provides an overview of electricity operations and member companies of the Association of Electric Companies of Texas (AECT). AECT is an advocacy group composed of electric companies committed to ensuring reliability, supporting competitive markets, and promoting economic and environmental goals. The document outlines the eight reliability regions in the US, including the four regions that cover Texas, and profiles 16 AECT member companies, including generation, transmission, distribution and retail companies.
The document provides an overview of electricity operations and recent statistics. It discusses how the US is divided into eight reliability regions overseen by NERC and FERC. It outlines the principles of the Association of Electric Companies of Texas (AECT), which advocates for a modern and reliable electricity infrastructure, efficient competitive markets, and consistent regulation. The document then lists and provides brief descriptions of AECT member companies operating in different reliability regions and market structures in Texas.
An overview of the structure of the competitive electric market in Texas, as well as an update on generation investment, transmission & distribution investment and retail performance in the market.
The document provides an overview of the electric industry in Texas, including the members of the Association of Electric Companies of Texas (AECT). AECT members include electric generation companies, transmission and distribution utilities, and retail electric providers. The document discusses the different types of AECT member companies and their roles in electricity operations in ERCOT and other regions of Texas.
The document provides an overview of electricity operations and member companies of the Association of Electric Companies of Texas (AECT). AECT is a trade organization composed of investor-owned electric companies in Texas committed to ensuring a reliable electricity supply. The document describes the different types of AECT member companies including transmission and distribution utilities, generation companies, and retail electric providers.
Players in the Texas Electricity MarketBounce Energy
The document provides an overview of the key players in the Texas electricity market and their roles:
- The Public Utility Commission of Texas (PUCT) regulates electric and telecommunications services to protect consumers and foster competition.
- Retail Electric Providers (REPs) handle billing, customer service, and facilitating electricity delivery for consumers.
- Transmission and Distribution Service Providers (TDSPs) maintain infrastructure and transmit electricity from power plants.
- Power generators produce electricity using various fuels that is then sold to REPs and distributed by TDSPs to meet consumers' daily electricity needs.
Questions and answers on current electric issues, including the retail market, wholesale investment, customer protections and smart meter implementation in Texas.
State electricity profile new jersey (1)Lyle Birkey
This document provides an overview of the electricity market in New Jersey. It discusses that New Jersey is part of the PJM Interconnection, which coordinates the movement of wholesale electricity for 13 states and Washington, DC. It also profiles the four major electric utilities in New Jersey and provides details on their service areas. The document then discusses the New Jersey Board of Public Utilities and its role in regulating the energy market and promoting renewable energy. It concludes with sections on regional transmission connections and constraints, New Jersey's generation fuel mix, and its renewable energy goals and credit markets.
Update on the Electric Industry in Texas: Summer Recapaectnet
Topics include: effects of summer weather, use of water by generation facilities, offers available in the competitive retail electric market and the CSAPR rule
The document discusses ensuring energy security, reliable power supply, and affordable power rates in the Philippines. It defines energy security based on definitions from the IEA and European Commission. The Philippines is currently not energy secure due to a cycle of power capacity deficiencies and high prices. It analyzes the adequacy and reliability of power supply in Luzon, Visayas, and Mindanao grids, finding future deficiencies without new power plants. It examines challenges to energy security under EPIRA, including lack of policy to ensure timely new capacity and high electricity prices compared to neighbors. It proposes options like aggregating electric cooperatives and large customers, embedded combined heat and power, and distribution utility bidding to contract new capacity. Finally, it
The document summarizes the history of electricity issues and reforms in the Philippines. It discusses the power crisis in the 1990s that stemmed from insufficient generating capacity. This prompted President Ramos to issue licenses to Independent Power Producers (IPPs) to build new plants. The IPPs solved the short-term crisis but their contracts proved costly. This led to the 2001 Electric Power Industry Reform Act that restructured the industry, privatized generation assets, and established an independent regulator. The document reviews key elements and impacts of the reforms, including the purchased power adjustment mechanism and issues raised around IPPs and distribution utility rates.
The document discusses the electric industry in Texas. It summarizes that severe winter weather in February 2011 caused over 8,000 MW of power generation to go offline, leading to controlled power outages. It notes lessons learned around winterization of power plants and the need for consistent regulation. The document also discusses lower natural gas prices available through retail electric competition and energy efficiency programs to help lower winter bills.
After 10 years of implementing the Electric Power Industry Reform Act (EPIRA) of 2001:
1) Power rates have more than doubled, with residential electricity prices rising 112.5% and NAPOCOR generation charges jumping 95%. EPIRA led to privatization that benefited private corporations over consumers.
2) Energy security remains precarious as the country relies on private investors and IPPs to build power capacity only when profitable, threatening an adequate supply. The 2010 power shortage in Mindanao illustrates this risk.
3) NAPOCOR remains deeply in debt despite paying billions to service obligations, as EPIRA legitimized passing on costs of inefficient contracts to consumers through rate adjustments like the
The document provides an update on the electric industry in Texas following power outages in early February 2011. It discusses how severe cold weather caused over 8,000 MW of generation to go offline, leading to controlled outages. It notes lessons learned around winterization and the state's reliance on natural gas generation. Additionally, it highlights competitive retail electric market options and energy efficiency programs that can help lower customer bills.
Reforming the Philippine Electric Power Industry Reform Act (EPIRA)Elvin Uy
Analysis of RA 9136, the Electric Power Industry Reform Act, for my Policy Analysis I course in Carnegie Mellon in 2010. Full paper can be viewed here: http://scr.bi/HNHTHU
This document is the Republic Act No 9136, also known as the Electric Power Industry Reform Act of 2001. It establishes policies for restructuring the electric power industry in the Philippines, including total electrification of the country, ensuring affordable and reliable electricity supply, and enhancing private sector participation and competition through privatization and regulatory reforms. It defines key terms, establishes the framework for transitioning to a competitive structure, and assigns roles and responsibilities to government agencies and private entities in the reformed industry.
The Association of Electric Companies of Texas (AECT) represents investor-owned electric companies in Texas. AECT member companies employ over 19,000 people and generate over 38,000 megawatts of power from various sources including natural gas, coal, nuclear, wind, and hydro. Collectively, AECT members pay over $1.9 billion in various state and local taxes each year and their economic impact is significant. Proposed new nuclear power investments in Texas would create thousands of additional jobs and positive economic impacts.
1) The document discusses Xcel Energy's strategy of executing operating company plans to optimize reliability and costs for customers while achieving financial performance targets.
2) It highlights initiatives across various operating companies including resource planning, rate cases, and legislative advocacy to balance customer, environmental, and shareholder interests.
3) The priorities for each operating company are identified as continuing safe and reliable operations, pursuing cost recovery through regulatory proceedings, and improving customer satisfaction.
Bangkok | Mar-17 | ACCESS TO SUSTAINABLE ENERGY PROJECTSmart Villages
The Philippine energy sector underwent major reforms through laws like the Electric Power Industry Restructuring Act of 2001 and Renewable Energy Act of 2008. This privatized the sector, introduced competition, and increased investment in renewable resources like solar and wind. Now the sector is mostly privately owned but still regulated by agencies like the Department of Energy and Energy Regulatory Commission. The goal is universal electrification by 2020, with a focus on remote and poor areas like Mindanao where access is lowest. The World Bank is assisting the development of sustainable energy projects to help achieve these targets through grid upgrades, off-grid solar home systems, and renewable energy integration.
Take a look at the facts you didn’t know about America’s power grid. Find out the importance of safer, secure and resilient electric grid across the country. A presentation of Current Solutions PC.
- The stock has a market price of $72.81 per share and a market capitalization of $30.555 billion. Its return last year was 23.6% with sales and earnings growth of -0.03350%.
- Analysts recommend holding the stock due to its diversification between regulated and unregulated energy markets. The company is well-positioned for growth in renewable energy.
This document provides an overview of the electric industry in Texas. It discusses the different market structures for electricity, including the competitive wholesale market in ERCOT versus regulated markets outside of ERCOT. In ERCOT, separate companies provide retail, transmission/distribution, and generation services, with wholesale and retail prices set by competitive market forces. Outside of ERCOT, a single company provides all services in each area, with retail rates set by the Public Utility Commission. The competitive wholesale market in ERCOT has brought greater efficiency through generators taking on risk to build new power plants.
This document provides an overview of the electricity industry in Texas, including:
1) It describes the regional transmission organizations and independent system operators that manage different parts of the electric grid across North America, including ERCOT which manages most of Texas.
2) It outlines the steps Texas took to introduce competition to its electricity market in the 1990s and 2000s, including separating generation, transmission, distribution and retail sales between different companies in ERCOT.
3) It shows that retail electricity prices in Texas, particularly for fixed-rate plans in ERCOT, are significantly lower than they were before competition and lower than average national prices.
The Texas Electric Industry: A History of Innovationaectnet
The document discusses the history and current state of the electric industry in Texas. It notes that Texas established a competitive electric market in 1999 that has led to innovation and customer choice. It summarizes the key players in the Texas market, including retail electric providers and transmission and distribution utilities. The document also discusses trends in electric generation, transmission infrastructure needs, and environmental performance to meet the growing demand of Texas's population and economy.
Why is Texas the Model for Energy Deregulation?Bounce Energy
States look to Texas as a model for energy deregulation because deregulation has stimulated billions of dollars in new investment in electrical generation and transmission infrastructure to keep up with Texas's growing demand for energy. This new investment has added reliable generating capacity and encouraged the growth of more efficient and less polluting energy technologies like wind and solar power. By introducing competition into the energy market, deregulation has also incentivized power companies to reduce costs and pass savings on to consumers.
Aspiring to exceptional customer service is at the forefront of everything we do at the Lower Colorado River Authority. We seek to earn our customers' business each and every day.
The document discusses the electric industry in Texas following power outages in early February 2011 caused by severe winter weather. It provides context on the industry groups and companies involved, explains what happened during the outages and lessons learned, and discusses natural gas prices and Texas' generation mix compared to the national average. The electric grid operator and utilities followed protocols to prevent widespread blackouts through controlled outages. Different types of power plants across the state were affected. Winterization procedures and oversight of natural gas for power generation have been discussed. Customers can choose lower electric rates or find efficiency programs to help lower bills.
Players in the Texas Electricity MarketBounce Energy
The document provides an overview of the key players in the Texas electricity market and their roles:
- The Public Utility Commission of Texas (PUCT) regulates electric and telecommunications services to protect consumers and foster competition.
- Retail Electric Providers (REPs) handle billing, customer service, and facilitating electricity delivery for consumers.
- Transmission and Distribution Service Providers (TDSPs) maintain infrastructure and transmit electricity from power plants.
- Power generators produce electricity using various fuels that is then sold to REPs and distributed by TDSPs to meet consumers' daily electricity needs.
Questions and answers on current electric issues, including the retail market, wholesale investment, customer protections and smart meter implementation in Texas.
State electricity profile new jersey (1)Lyle Birkey
This document provides an overview of the electricity market in New Jersey. It discusses that New Jersey is part of the PJM Interconnection, which coordinates the movement of wholesale electricity for 13 states and Washington, DC. It also profiles the four major electric utilities in New Jersey and provides details on their service areas. The document then discusses the New Jersey Board of Public Utilities and its role in regulating the energy market and promoting renewable energy. It concludes with sections on regional transmission connections and constraints, New Jersey's generation fuel mix, and its renewable energy goals and credit markets.
Update on the Electric Industry in Texas: Summer Recapaectnet
Topics include: effects of summer weather, use of water by generation facilities, offers available in the competitive retail electric market and the CSAPR rule
The document discusses ensuring energy security, reliable power supply, and affordable power rates in the Philippines. It defines energy security based on definitions from the IEA and European Commission. The Philippines is currently not energy secure due to a cycle of power capacity deficiencies and high prices. It analyzes the adequacy and reliability of power supply in Luzon, Visayas, and Mindanao grids, finding future deficiencies without new power plants. It examines challenges to energy security under EPIRA, including lack of policy to ensure timely new capacity and high electricity prices compared to neighbors. It proposes options like aggregating electric cooperatives and large customers, embedded combined heat and power, and distribution utility bidding to contract new capacity. Finally, it
The document summarizes the history of electricity issues and reforms in the Philippines. It discusses the power crisis in the 1990s that stemmed from insufficient generating capacity. This prompted President Ramos to issue licenses to Independent Power Producers (IPPs) to build new plants. The IPPs solved the short-term crisis but their contracts proved costly. This led to the 2001 Electric Power Industry Reform Act that restructured the industry, privatized generation assets, and established an independent regulator. The document reviews key elements and impacts of the reforms, including the purchased power adjustment mechanism and issues raised around IPPs and distribution utility rates.
The document discusses the electric industry in Texas. It summarizes that severe winter weather in February 2011 caused over 8,000 MW of power generation to go offline, leading to controlled power outages. It notes lessons learned around winterization of power plants and the need for consistent regulation. The document also discusses lower natural gas prices available through retail electric competition and energy efficiency programs to help lower winter bills.
After 10 years of implementing the Electric Power Industry Reform Act (EPIRA) of 2001:
1) Power rates have more than doubled, with residential electricity prices rising 112.5% and NAPOCOR generation charges jumping 95%. EPIRA led to privatization that benefited private corporations over consumers.
2) Energy security remains precarious as the country relies on private investors and IPPs to build power capacity only when profitable, threatening an adequate supply. The 2010 power shortage in Mindanao illustrates this risk.
3) NAPOCOR remains deeply in debt despite paying billions to service obligations, as EPIRA legitimized passing on costs of inefficient contracts to consumers through rate adjustments like the
The document provides an update on the electric industry in Texas following power outages in early February 2011. It discusses how severe cold weather caused over 8,000 MW of generation to go offline, leading to controlled outages. It notes lessons learned around winterization and the state's reliance on natural gas generation. Additionally, it highlights competitive retail electric market options and energy efficiency programs that can help lower customer bills.
Reforming the Philippine Electric Power Industry Reform Act (EPIRA)Elvin Uy
Analysis of RA 9136, the Electric Power Industry Reform Act, for my Policy Analysis I course in Carnegie Mellon in 2010. Full paper can be viewed here: http://scr.bi/HNHTHU
This document is the Republic Act No 9136, also known as the Electric Power Industry Reform Act of 2001. It establishes policies for restructuring the electric power industry in the Philippines, including total electrification of the country, ensuring affordable and reliable electricity supply, and enhancing private sector participation and competition through privatization and regulatory reforms. It defines key terms, establishes the framework for transitioning to a competitive structure, and assigns roles and responsibilities to government agencies and private entities in the reformed industry.
The Association of Electric Companies of Texas (AECT) represents investor-owned electric companies in Texas. AECT member companies employ over 19,000 people and generate over 38,000 megawatts of power from various sources including natural gas, coal, nuclear, wind, and hydro. Collectively, AECT members pay over $1.9 billion in various state and local taxes each year and their economic impact is significant. Proposed new nuclear power investments in Texas would create thousands of additional jobs and positive economic impacts.
1) The document discusses Xcel Energy's strategy of executing operating company plans to optimize reliability and costs for customers while achieving financial performance targets.
2) It highlights initiatives across various operating companies including resource planning, rate cases, and legislative advocacy to balance customer, environmental, and shareholder interests.
3) The priorities for each operating company are identified as continuing safe and reliable operations, pursuing cost recovery through regulatory proceedings, and improving customer satisfaction.
Bangkok | Mar-17 | ACCESS TO SUSTAINABLE ENERGY PROJECTSmart Villages
The Philippine energy sector underwent major reforms through laws like the Electric Power Industry Restructuring Act of 2001 and Renewable Energy Act of 2008. This privatized the sector, introduced competition, and increased investment in renewable resources like solar and wind. Now the sector is mostly privately owned but still regulated by agencies like the Department of Energy and Energy Regulatory Commission. The goal is universal electrification by 2020, with a focus on remote and poor areas like Mindanao where access is lowest. The World Bank is assisting the development of sustainable energy projects to help achieve these targets through grid upgrades, off-grid solar home systems, and renewable energy integration.
Take a look at the facts you didn’t know about America’s power grid. Find out the importance of safer, secure and resilient electric grid across the country. A presentation of Current Solutions PC.
- The stock has a market price of $72.81 per share and a market capitalization of $30.555 billion. Its return last year was 23.6% with sales and earnings growth of -0.03350%.
- Analysts recommend holding the stock due to its diversification between regulated and unregulated energy markets. The company is well-positioned for growth in renewable energy.
This document provides an overview of the electric industry in Texas. It discusses the different market structures for electricity, including the competitive wholesale market in ERCOT versus regulated markets outside of ERCOT. In ERCOT, separate companies provide retail, transmission/distribution, and generation services, with wholesale and retail prices set by competitive market forces. Outside of ERCOT, a single company provides all services in each area, with retail rates set by the Public Utility Commission. The competitive wholesale market in ERCOT has brought greater efficiency through generators taking on risk to build new power plants.
This document provides an overview of the electricity industry in Texas, including:
1) It describes the regional transmission organizations and independent system operators that manage different parts of the electric grid across North America, including ERCOT which manages most of Texas.
2) It outlines the steps Texas took to introduce competition to its electricity market in the 1990s and 2000s, including separating generation, transmission, distribution and retail sales between different companies in ERCOT.
3) It shows that retail electricity prices in Texas, particularly for fixed-rate plans in ERCOT, are significantly lower than they were before competition and lower than average national prices.
The Texas Electric Industry: A History of Innovationaectnet
The document discusses the history and current state of the electric industry in Texas. It notes that Texas established a competitive electric market in 1999 that has led to innovation and customer choice. It summarizes the key players in the Texas market, including retail electric providers and transmission and distribution utilities. The document also discusses trends in electric generation, transmission infrastructure needs, and environmental performance to meet the growing demand of Texas's population and economy.
Why is Texas the Model for Energy Deregulation?Bounce Energy
States look to Texas as a model for energy deregulation because deregulation has stimulated billions of dollars in new investment in electrical generation and transmission infrastructure to keep up with Texas's growing demand for energy. This new investment has added reliable generating capacity and encouraged the growth of more efficient and less polluting energy technologies like wind and solar power. By introducing competition into the energy market, deregulation has also incentivized power companies to reduce costs and pass savings on to consumers.
Aspiring to exceptional customer service is at the forefront of everything we do at the Lower Colorado River Authority. We seek to earn our customers' business each and every day.
The document discusses the electric industry in Texas following power outages in early February 2011 caused by severe winter weather. It provides context on the industry groups and companies involved, explains what happened during the outages and lessons learned, and discusses natural gas prices and Texas' generation mix compared to the national average. The electric grid operator and utilities followed protocols to prevent widespread blackouts through controlled outages. Different types of power plants across the state were affected. Winterization procedures and oversight of natural gas for power generation have been discussed. Customers can choose lower electric rates or find efficiency programs to help lower bills.
The Canadian electricity sector is organized along provincial lines, with most provinces having large, government-owned utilities that play a leading role. While electricity generation and distribution are primarily regulated by provinces, some provinces like Alberta and Ontario have introduced electricity markets to increase competition. Provincial regulatory bodies oversee generation, transmission, distribution and pricing in their jurisdictions. [END SUMMARY]
Canada's electricity sector has consistently provided safe, reliable electricity for over a century but now faces the challenges of upgrading aging infrastructure to meet future demand and environmental commitments. The sector is regulated at the provincial level and organized along provincial boundaries, with most provinces relying on large public utilities. Significant investment estimated at $240 billion is needed by 2030 to replace old assets, expand capacity, improve efficiency and reduce emissions. Transforming the system will require coordination between industry, governments, regulators and other stakeholders to balance environmental and economic objectives.
The document discusses water usage and electricity generation in Texas. It notes that AECT member companies represent major owners and operators of reservoirs in Texas. Water is essential for reliable electricity generation, as most power plants use water to create steam that turns turbines. The document outlines how power plants use water and their water conservation efforts. It also summarizes the drought's impacts, including potential generation losses, and actions generators are taking to mitigate issues and ensure reliable operations.
This document provides an overview and update on Texas' electric industry as of September 2009. It discusses the goals of the Association of Electric Companies of Texas, the regional reliability organizations that oversee Texas' electric grid, recent changes to the retail electric market and transmission/distribution systems, record electricity demand that summer, continued investment in new generation, falling retail electric prices, progress on advanced metering, and benefits of the smart grid.
The document discusses opportunities for improving energy resilience in northern New Mexico through increased utilization of regional renewable resources. It profiles three electric utilities - Kit Carson Electric Cooperative, Springer Electric Cooperative, and Raton Public Service - which currently face challenges like reliance on imported power and high energy costs. Opportunities for the utilities include expanding their solar and biomass energy production, using local waste streams, and exploring hydroelectric and energy storage options to strengthen the regional energy portfolio and create sustainable local jobs.
Wind Development in Texas: History and Future Growthaectnet
The document discusses wind development and renewable energy in Texas. It provides background on the electric reliability regions in Texas, the types of electric companies in ERCOT and outside of ERCOT, and how they differ. It also summarizes the characteristics of wind power generation and some of the legislative steps Texas has taken to promote renewable development, including mandating increases in renewable power.
The New Age of Renewable Energy in TexasBounce Energy
The document discusses the growing renewable energy potential and market in Texas. It outlines that Texas has enough renewable energy potential from biomass, wind, and solar to equal 400 times the state's annual energy consumption. Texas has also established renewable portfolio standards requiring 5,880 MW of renewable energy by 2015 and 10,000 MW by 2025 through policies like renewable energy credits traded on the open market. Texas is a leader in wind energy generation and has significant potential for solar energy development.
USA Transmission System - Climate InstituteManu Preckler
This is the second presentation from the series where I explain concepts related to the North American SuperGrid.
On this occasion, I begin with a brief introduction to the balance of the system, in order to achieve an acceptable frequency. I continue enumerating and explaining the main functions of the agents that participate in this process. Finally, I give as an example an assumption case in the state of Colorado.
http://northamericansupergrid.org/
http://climate.org/
Austin Energy is a publicly owned electric utility company in central Texas that serves over 440,000 retail customers. It has a rich 121-year history of providing power to the growing city of Austin. Austin Energy owns several natural gas, coal, and nuclear power plants and also sources solar and wind energy. It reports to the Austin City Council and transfers over $100 million in annual profits to help fund city services. Despite past challenges including flooding and deregulation attempts, Austin Energy has reliably provided power to Austin for over a century and continues to do so today.
FUTURE RESILIENCE OF THE UK ELECTRICITY SYSTEM ARE WE RESILIENT TO MEET THE N...Peter Jones
The Energy Research Partnership (ERP) has brought together a range of stakeholders from across the energy sector to develop a common view on the future resilience of the UK Electricity System.
This work has identified a range of emerging trends that are changing the way we operate the electricity system and will need to be acted upon to assure we have a resilient electricity system in the future. In response to these trends a number of recommendations have been made that require action over the next decade to assure resilience of the electricity system in the future.
The document discusses cleantech innovation in New England. It notes that Massachusetts is a leader in cleantech, home to world-class universities and labs. Cleantech activity is concentrated in sectors like energy storage, chemicals, and advanced materials. Over 200 early-stage cleantech companies in New England have raised over $1.1 billion from sources like venture capital funds and Department of Energy grants. The region boasts strong cleantech innovation infrastructure including universities, research organizations, incubators, and numerous supporting organizations that promote clean energy development.
This document summarizes the challenges California faced in meeting its growing energy demand, including a lack of new power plant construction between 1994-2000 despite population growth. It then highlights the High Desert Power Plant as the 2003 Plant of the Year for how it partnered with the local community, offset its emissions in an innovative way, and managed water usage with a zero liquids discharge system. The plant helped meet California's urgent need for new generation capacity while minimizing environmental impacts.
$400,000,000 total cost privately owned 800 MegaWatt combined cycle natural gas-fired power plant that generates the electricity to now serve 500,000 Los Angeles residents.
Similar to AECT Electricity 101: January 2011 Update (20)
Overview of Non-ERCOT Electric Utilities in Texasaectnet
The document provides an overview of electric utilities in Texas that are not part of the Electric Reliability Council of Texas (ERCOT). It notes that these non-ERCOT utilities operate within three other regional transmission organizations and have maintained reasonable electric prices due to wholesale competition, even without retail competition. The challenges to implementing retail competition for non-ERCOT utilities are also discussed, as well as how these utilities continue to innovate in areas like advanced metering and renewable energy.
This document discusses the environmental performance and practices of electric companies in Texas. It summarizes that Texas electric generators have lower emissions rates than national averages and neighboring states. It also discusses the electric industry's reliance on water for cooling and how companies work to ensure reliable water access. The document provides information on generation sources, emissions comparisons, water usage, conservation efforts, and environmental programs.
The document discusses electric ratemaking in Texas, including how rates are determined through revenue requirements and rate structures, the regulatory process for rate cases, and recent mechanisms introduced in utility ratemaking like distribution cost recovery factors. It also covers concepts like allowed versus earned rates of return and how utilities are regulated differently within and outside the ERCOT grid.
The document discusses the retail electric market in ERCOT, including a timeline of deregulation and retail competition in Texas starting in 1999. It provides statistics on ERCOT such as covering 90% of Texas' electric load and having over 75% of load in the competitive retail market. The purpose is to advocate for the benefits of retail electric competition in Texas, highlighting lower prices, customer choice, and fewer complaints compared to before deregulation.
State and Local Taxation of the Electric Industry in Texas aectnet
The document summarizes state and local taxes paid by electric companies in Texas that are members of the Association of Electric Companies of Texas (AECT). In 2019, AECT member companies paid $1.83 billion in various state and local taxes and collected an additional $315.5 million in sales taxes from customers. The largest taxes paid were $742.1 million in property taxes and $578.4 million in municipal franchise fees. The document provides details on the different types of taxes paid and collected and the amounts for each.
This document summarizes key aspects of the wholesale electricity market in ERCOT (Electric Reliability Council of Texas), the independent system operator that manages the flow of electric power to 24 million customers in Texas. It outlines ERCOT's responsibilities and operations, describes how retail, transmission, distribution and generation services are separated, and examines trends like declining natural gas and increasing renewable generation and battery storage on ERCOT's generation mix and reliability outlook. It also discusses factors like persistently low power prices, price volatility, and how forward prices impact future supply investment decisions in ERCOT's energy-only wholesale market.
This document provides an overview of the electricity market in Texas, including:
- The roles of different organizations like ERCOT, transmission and distribution utilities, retail electric providers, and generation companies.
- How electricity competition was introduced through legislation in 1995 and 1999.
- How the competitive retail electric market operates within ERCOT compared to regulated areas outside of ERCOT.
- Evidence that average electricity prices in Texas today are lower than before competition, and Texas has a better national price ranking.
This document discusses threats to the reliable operation of the electric grid and efforts by electric utilities and regulatory agencies to mitigate these threats. It outlines different types of threats including physical threats like storms, cyber threats such as hacking, and magnetic threats from solar flares. It describes strategies utilities use to avoid, prepare for, and respond to potential outages from these threats. These strategies include emergency planning, hardening infrastructure, monitoring systems, and coordinating response efforts. The document also discusses regulatory protocols and ongoing coordination activities between utilities and agencies to continuously improve grid resilience.
This document discusses how electric utilities work to maintain a reliable electric grid in the face of various threats. It outlines how utilities in different markets structure generation, transmission, and distribution services. It also describes strategies utilities employ to prevent and respond to physical threats like storms, cyber threats like hacking, and magnetic threats like solar flares. Utilities coordinate with government agencies, harden infrastructure, invest in new technologies, and conduct drills to minimize outage risks and restore power quickly if outages occur. The document advocates for policies and protocols established by the North American Electric Reliability Corporation to govern industry cybersecurity standards and information sharing.
The document discusses the wholesale electricity market in ERCOT (Electric Reliability Council of Texas). It provides background on the steps taken in 1995 to introduce competition through Senate Bill 373, which required open access transmission. It outlines the key participants in the ERCOT market including generation companies, retail electric providers, and ERCOT's role. It also summarizes trends like flat wholesale prices, fuel types used for generation, and projections that additional generation will be needed to support Texas' growing population.
State and Local Taxation of the Electric Industry in Texasaectnet
AECT member companies pay significant state and local taxes that bolster government revenue. In 2017, AECT members paid $1.73 billion in state and local taxes, averaging $77,745 per employee. They also collected $295.9 million in sales taxes from customers. The document discusses various taxes paid by AECT members, including gas, electric, and water utility taxes; public utility gross receipts assessments; sales and use taxes; franchise taxes; and property taxes. It provides amounts paid for each tax in 2017. The document advocates for tax policies based on accountability, equity, and stability.
AECT Lunch-and-Learn: Update on the Electric Marketaectnet
This document provides an overview and update on issues related to the electric market in Texas, including recovery efforts after Hurricane Harvey and implementation of recent electricity legislation. It summarizes how various electric utilities were impacted by Harvey and the steps taken for recovery, including mutual assistance from other states. It also outlines regulatory timelines and proceedings around low-income programs, ratemaking, advanced metering, and the transition of Sharyland customers to Oncor infrastructure. Finally, it discusses Sempra Energy's recent outbid of Berkshire Hathaway Energy to purchase Oncor.
The document introduces the new leadership team at the Association of Electric Companies of Texas (AECT), including Julia Rathgeber as President & CEO with 25 years of experience in government, and three Vice Presidents covering policy, communications, and government relations. It then provides updates on the competitive electric market in Texas including low prices compared to other states, and the restoration efforts after heavy rains and flooding in Houston where nearly 90% of customers were restored within 27 hours thanks to utility crews and smart grid technology. It concludes with information on how to stay updated on electric industry issues through AECT's website and social media channels.
Update on the Texas Electric Industry: Preparing for Summeraectnet
This document provides an update on preparations for summer in the Texas electric industry. It discusses how higher temperatures increase electricity consumption and bills. Retail electric providers have launched solutions to address common customer inquiries during the summer, such as providing energy efficiency tips and bill payment assistance options. Generators are prepared for increased demand during heat waves. Hurricane season also begins in June.
Legislative Staff Briefing: Update on the Texas Electric Industryaectnet
The document provides an update on the Texas electric industry. It discusses how unusually cold winter weather led to higher electricity usage and potentially increased electric bills for customers. It also notes that the Sharyland Utilities service area has opened to retail electric competition, allowing customers to choose electric providers. Transmission and distribution utility issues are also mentioned.
Fall Update on the Competitive Retail Market in ERCOTaectnet
The document summarizes retail electricity prices in Texas from 2001 to 2012. It finds that:
1) Price offers are substantially lower than in 2001, even when adjusted for inflation, as retail electric prices have fallen while other energy prices have risen.
2) Texas' national electric price ranking has improved since retail competition began in 2001, and every competitive area in Texas has offers lower than the national average.
3) Among states dependent on natural gas for power, Texas prices compare favorably to other states.
4) The Texas electricity market provides prices that track natural gas prices efficiently.
Summer 2012 Update on the Electric Industry in Texasaectnet
- Summer 2012 saw peak demand in Texas continue to rise year-over-year, increasing concerns over resource adequacy in the next few years given retirements of older coal and gas plants.
- While summer 2012 was warmer than average, it was cooler than the extremely hot summer of 2011. ERCOT and the PUC encouraged energy efficiency and conservation.
- ERCOT's fall forecast showed sufficient capacity for the coming season, but concerns remain over replacing retiring generators in the medium term given the long lead times to bring new plants online. ERCOT will continue monitoring the situation closely.
The document provides an overview of ERCOT's challenges and opportunities. It discusses resource adequacy issues including the aging generation fleet and increasing peak demand. It also covers wind growth in Texas, potential for demand response programs, updates on drought conditions, and progress on transmission projects.
This document summarizes the benefits of retail electric competition in Texas. Key points include:
- Electric prices today are lower than one year ago and substantially lower than before competition began, even as fuel costs have risen.
- Texas prices compare favorably to other states highly dependent on natural gas.
- Prices have fallen 33% on average since 2006 while national prices outside Texas rose 21%.
- Assistance programs help low-income customers with summer electricity costs.
1. Electricity 101:
Operations and Recent Statistics
January 2011
Legislative advertising paid for by: John W. Fainter, Jr. • President and CEO Association of Electric Companies of Texas, Inc.
1005 Congress, Suite 600 • Austin, TX 78701 • phone 512-474-6725 • fax 512-474-9670 • www.aect.net
2. AECT Principles
• AECT is an advocacy group composed of member companies committed to:
- Ensuring a modern, reliable infrastructure for the supply & delivery of
electricity.
- Supporting efficient competitive markets that are fair to customers and
market participants.
- Supporting consistent and predictable oversight and regulation that will
promote investment and ensure the stability of Texas’ electric industry.
- Promoting an economically strong and environmentally healthy future for
Texas, including conservation and efficient use of available resources.
• AECT member companies remain dedicated to providing Texas customers with
reliable service and are committed to the highest standards of integrity.
The Association of Electric Companies of Texas, Inc. (AECT) is a trade organization of investor-
owned electric companies in Texas. Organized in 1978, AECT provides a forum for member
company representatives to exchange information about public policy, and to communicate with
government officials and the public. For more information, visit www.aect.net.
2
3. U.S. Divided into Eight
Reliability Regions
• The eight reliability regions in the FERC
continental U.S. are subject to the
oversight and enforcement authority of NERC
the North American Electric Reliability
Corporation (NERC), which is subject to
the Federal Energy Regulatory
Commission’s (FERC) oversight. NERC
is responsible for developing standards
to ensure and improve reliability for
delivery of electricity on the bulk power
system.
• Electric systems in Texas are located
within four separate reliability regions:
- Texas Regional Entity (TRE),
which oversees participants in the
Electric Reliability Council of
Texas (ERCOT) (green shading);
- SERC Reliability Corporation;
- Southwest Power Pool (SPP); and
- Western Electricity Coordinating
Council (WECC).
(ERCOT)
3
4. AECT Member Companies
Within ERCOT
Retail Electric Providers
Transmission and Distribution Utilities
Generation Companies
4
5. AECT Companies
Outside of ERCOT
SERC Reliability Corporation
Southwest Power Pool (SPP)
Western Electricity Coordinating
Council (WECC)
5
6. Contents
Slide 7: AECT Member Companies
Slide 23: Electric Market Structures in Texas
Slide 36: Texas’ Wholesale Electric Market
Slide 46: ERCOT Generation Mix
Slide 53: Types of Generation: Benefits and
Challenges
Slide 63: Emissions and the Environment
Slide 75: Transmission and Distribution Utilities
Slide 85: Energy Efficiency
Slide 93: Competitive Retail Electric Market in
ERCOT
6
8. AEP SWEPCO
Vertically Integrated Utility
Southwestern Electric Power Company,
headquartered in Shreveport, LA,
serves 460,000 customers in East
Texas and the Texas Panhandle,
Northwest Louisiana, and the western
edge of Arkansas. SWEPCO has been
providing low-cost, reliable electricity to
customers since 1912. SWEPCO is a
vertically integrated company operating
as a member of the Southwest Power
Pool.
8
9. AEP Texas
Transmission & Distribution Utility
AEP Texas is connected to and serves
more than 900,000 electric consumers
in the deregulated Texas marketplace.
As an energy delivery company, AEP
Texas delivers electricity safely and
reliably to homes, businesses and
industry across its nearly 100,000
square mile service territory in south
and west Texas.
9
10. CenterPoint Energy
Transmission & Distribution Utility
CenterPoint Energy maintains the wires,
poles and electric infrastructure
delivering service to more than 2 million
consumers in its 5,000-square-mile
electric service territory in the Houston
metropolitan area. While CenterPoint
Energy employees ensure the reliable
delivery of electricity from power plants
to homes and businesses, the company
neither generates power nor sells it to
retail customers.
10
11. El Paso Electric Company
Vertically Integrated Utility
El Paso Electric is a vertically integrated
utility serving approximately 357,000
customers in the Rio Grande Valley in
west Texas and southern New Mexico.
El Paso Electric is an operating member
of the Western Electricity Coordinating
Council.
11
12. Entergy Texas
Vertically Integrated Utility
The Entergy Texas service area starts
at the southeast Texas/Louisiana border
and stretches up into the piney woods
of east Texas, down to the Gulf of
Mexico and across to the lake country
north of Houston. Entergy Texas serves
approximately 385,000 customers in 26
counties.
12
13. Exelon Generation
Electric Generation Company
Exelon Generation owns and controls about
33,000 megawatts of electricity generation
capacity from a diverse portfolio that includes
the nation’s largest fleet of nuclear power
plants. The company maintains strong
positions in the Midwest and Mid-Atlantic
regions. In Texas, it owns or controls about
3,700 megawatts of natural gas-fired
generation, with plants in Dallas, Fort Worth
and LaPorte. Exelon has also announced
plans to submit a combined Construction and
Operating License application for the possible
construction of a nuclear power plant in
Victoria County.
13
14. First Choice Power
Retail Electric Provider
First Choice Power began serving
customers as a retail electric provider
across Texas on Jan. 1, 2002, when
deregulation of the electric industry was
introduced in Texas. First Choice Power
is one of the largest retail electric
providers in the state. It is led by a
management team with experience in
the deregulated markets in Texas and
throughout the nation.
Competitive Areas of Texas
14
15. Luminant
Electric Generation Company
Luminant is a competitive power
generation business, including mining,
wholesale marketing and trading,
construction and development. It has
over 18,300 MW of generation in Texas,
including 2,300 MW of nuclear and
5,800 MW of coal-fueled generation
capacity, and is the largest purchaser of
wind-generated electricity in Texas and
fifth largest in the U.S.
15
16. NRG Energy
Electric Generation Company
NRG Texas is the second largest
electrical generator in Texas with more
than 1,100 professional employees
operating a diverse generation portfolio
of almost 11,000 megawatts of power.
NRG Texas also has an extensive
repowering program including a new
combined cycle gas plant at the Cedar
Bayou plant east of Houston, a coal unit
at Limestone; two wind projects in West
Texas and the first new nuclear units
proposed for the United States in more
than 29 years.
16
17. Oncor
Transmission & Distribution Utility
Oncor is a regulated electric distribution
and transmission business that delivers
reliable electricity to consumers. Oncor
operates the largest distribution and
transmission system in Texas, providing
power to more than 3 million electric
delivery points over more than 115,000
miles of transmission and distribution
lines.
17
18. Optim Energy
Electric Generation Company
Optim Energy is a joint venture of PNM
Resources and Cascade Investment,
L.L.C. It provides wholesale generation
and marketing and trading services in
the ERCOT region. The company owns
two generation assets, both in Texas,
representing 920 megawatts. In
addition, the company and NRG are
jointly developing a 550-megwatt
combined cycle natural gas unit near
Houston.
18
19. Reliant Energy
Retail Electric Provider
Reliant Energy, Inc., based in Houston,
Texas, provides electricity and energy-
related products to more than 1.8 million
retail and wholesale customers in Texas
and in the Mid-Atlantic Region. As one
of the largest electricity providers in
Texas, Reliant works hard to provide its
customers with competitive electric
prices, innovative products and
unmatched customer service for their
homes and businesses.
Competitive Areas of Texas
19
20. Texas-New Mexico Power Co.
Transmission & Distribution Utility
Currently, TNMP provides electric
service to 76 cities and more than
226,000 customers throughout Texas.
TNMP is owned by PNM Resources, an
energy holding company based in
Albuquerque, New Mexico.
20
21. TXU Energy
Retail Electric Provider
TXU Energy is a market-leading
competitive retailer that provides
electricity and related services to more
than 2 million electricity customers in
Texas. TXU Energy offers a variety of
innovative products and solutions,
including 24/7 customer service,
competitively priced service plans,
energy efficiency options and renewable
energy programs.
Competitive Areas of Texas
21
22. Xcel Energy
Vertically Integrated Utility
Xcel Energy owns Southwestern Public
Service Company, a regional electric
utility that provides service to about
400,000 persons in a 45,000 square-
mile area comprised of the South Plains
and Panhandle of Texas, and eastern
New Mexico.
22
24. History of Electric Utility
Regulation in Texas
Pre-1975
• Cities regulated electric utility service and rates.
• Generally, a declining cost industry – rate applications most often filed to decrease rates.
1975
• Inflation, construction costs and fuel costs drive electricity rates up.
• 64th Texas Legislature enacts Public Utility Regulatory Act (PURA) to implement state regulation of
electric utility service and rates (Cities permitted to retain original jurisdiction).
– Service area, transmission line and generating plant certification.
– Rate regulation (based on cost of service plus reasonable return on investment).
– Rates based on historical test year costs and original costs of infrastructure, less depreciation.
– Service quality regulation.
– Customer protection.
24
25. History of Electric Utility
Regulation in Texas
1976-1995
• 1978 U.S. Fuel Use Act required utilities to discontinue use of natural gas and encouraged the use of
coal and nuclear for fuel.
• Inflation, volatile fuel costs and the need to add new generating capacity continue to increase
electricity rates.
• Rate proceedings at PUC become increasingly adversarial.
– Consumer groups concerned about frequency and amount of rate increases.
– Utilities concerned about increasingly large PUC cost disallowances that are at odds with the
regulatory compact and erode rates of return.
• Large customers tire of subsidizing other ratepayers seek opportunities to by-pass regulated rates and
obtain choice of suppliers.
– Cogeneration/self-generation.
– Advocate wholesale competition and transmission open access.
– Advocate “retail wheeling”.
• Natural gas was favored again when the 1978 U.S. Fuel Use Act was repealed in the 1990s.
25
26. Steps to Electric Competition
In Texas
Jan.
2007
Jan.
End of
2005
price-to-
Jan. Affiliate
beat
2002 REPs
July Retail
allowed to
2001
choice
offer non-
price-to-
Sept. Texas
begins in
beat prices
1999
Choice
ERCOT
June ERCOT pilot
Electric program
1999 begins
rates
May frozen
Retail
1995 competition
Wholesale legislation
competition
legislation
Passed (SB 7)
passed (SB 373) 26
27. Wholesale and Retail Electric
Competition Were Passed
With Broad, Bipartisan Support
• Senate Bill 373, which opened the wholesale electricity market in Texas,
passed in 1995 when the Democrats were the majority party in the
House and Senate.
– The Speaker of the House and the Lieutenant Governor were both
Democrats, and the bill sponsors and authors were both Democrats.
• Senate Bill 7, which opened the competitive market, passed in 1999.
– The Senate and the Lieutenant Governor were Republican, but the House
was still majority Democrat. The House sponsor and author of the bill and the
House Speaker in 1999 were both Democrats.
– Senate Bill 7 passed the House with a vote of 144 Ayes and 4 Nays.
• It was a bipartisan measure: 74 of the Aye votes were from Democrats,
while 68 were from Republicans.
– The bill passed the Senate with a vote of 28 Ayes and 3 nays.
27
28. Steps to Competition:
Wholesale Competition
• Senate Bill No. 373 enacted in May 1995
– Required utilities to provide non-discriminatory open access transmission
to support wholesale competition in ERCOT.
– Recognized new, unregulated participants in ERCOT wholesale market.
Exempt wholesale generators
Power marketers
– Allowed non-utility wholesale market participants to offer market-based
prices in ERCOT.
– Deregulated electric cooperative distribution rates.
Note: Non-ERCOT areas are subject to FERC jurisdiction for wholesale
services, including transmission services.
28
29. Steps to Competition:
Retail Competition
• ERCOT market restructuring legislation, Senate Bill 7, passed in
1999
– Initiated competition in ERCOT retail markets beginning January 2002.
– Municipally-owned utilities and electric cooperatives allowed to “opt-in”.
– Included environmental and energy efficiency provisions.
• Required reduction of nitrogen oxide (NOx) emissions from older power plants by
50%, and sulfur dioxide emission from coal-fired facilities by 25%.
• Utilities required to fund energy efficiency programs equal to at least 10% of each
year’s annual growth in demand.
– 1999 - 2001 – Preparation for retail competition.
• Electricity rates frozen.
• ERCOT develops systems required to support competition.
• PUC promulgates competition rules.
• PUC determines rate unbundling cases.
– July 2001 – Retail competition pilot project begins.
29
30. Steps to Competition:
Transition Period
• January 2002-2006 Transition Period
– “Affiliated” generators
• Required to make 15% of their power available to non-affiliated retail providers
• During first two years, limited to guaranteed market price for power as projected by
PUC
• Given incentives to install environmental clean-up equipment
– Transmission and Distribution Utilities
• Initial rates set using estimated/generic costs
• Recovery of stranded and other transition costs authorized but delayed until 2004
True-up proceeding
– Securitization bonds lower cost to customers
– “Affiliated” retail electric providers
• Required to lower base rates by six percent (Price to Beat)
– Adjustable only for increases in natural gas prices
– Price to Beat remains in place until 12-31-06
• No price competition allowed in former service area until 2005
30
31. Structural Unbundling
• Incumbents required to separate business activities into the following
units.
– Power generation company.
– Retail electric provider.
– Transmission and distribution utility.
• Generation and retail businesses are not regulated utilities.
– Power Generation Companies must be registered with PUC.
– Retail Electric Providers must be certified by PUC.
• Transmission and distribution businesses remain regulated utilities.
• Methods for separation of business activities.
– Creation of separate non-affiliated companies.
– Creation of separate affiliated companies owned by a common holding
company.
– Sale of assets to a third party.
• Each ERCOT utility chose different models.
• Code of conduct rules enforce separation requirements. 31
32. ERCOT: Separate companies provide
retail, transmission & distribution and
generation services
Power Flow
Financial Flow
Regulated
• In competitive markets, consumers have multiple retail electric providers
(REPs) and service plans to choose from.
• Wholesale and retail prices are set by competitive market forces, while the
PUC sets transmission and distribution rates. 32
33. ERCOT: Separate companies provide
retail, transmission & distribution and
generation services
Power Flow
Financial Flow
Regulated
• Because wholesale electric prices are set by the competitive market, the
risks associated with the cost of construction, operations and maintenance
of a generation plant are borne entirely by the generator and its investors,
not by end-use customers.
33
34. Outside ERCOT: A single company
provides retail, transmission & distribution
and generation services in each area
Power Flow
Financial Flow
Regulated
• In fully regulated markets, the PUC sets retail rates charged to end-use
customers.
• Each of these service areas is part of multi-state electric grids, with
differing regulations. In many cases, vertically integrated utilities purchase
wholesale power from certain unregulated entities. 34
35. Outside ERCOT: A single company
provides retail, transmission & distribution
and generation services in each area
Power Flow
Financial Flow
Regulated
• New power plants in these regions can be built by both regulated entities
and certain unregulated entities or qualifying facilities.
• Regulated utility power plants, however, must be approved by the PUC
after a rigorous review of need and siting.
35
37. The Competitive Wholesale Market: A
Success Story
Competition has brought greater efficiency
to the wholesale market
– Generators shoulder the risk of building new power plants, bringing efficient,
cost-effective generation to consumers.
– New power plants produce more electricity per unit of fuel.
– New power plants include modern environmental emissions controls.
The competitive market is in the public interest
– Operational efficiency of a competitive market helps push wholesale prices
downward.
– No market structure is more effective at ensuring efficient operations than a
competitive one.
Policy decisions should be focused on
maintaining vibrant competition
– Texas leaders should support policies that maintain the competitive market.
– The competitive market will bring forward the right mix of technology and fuel
type based on environmental choices by policymakers.
37
39. ERCOT Wholesale
Market Management
• System Reliability
– ERCOT oversees system reliability.
– ERCOT is part of national reliability council.
– ERCOT protocols, approved by PUC, mandate system reliability standards that all
market participants must follow.
• Statute and Rules Address “Market Power” and Generation Merger Issues
– Independent Market Monitor oversees wholesale market operations.
– Generating capacity owned and controlled by a Power Generation Company limited to
20% of installed generating capacity capable of delivering power to a power region.
– Administrative penalties for market power abuse were reviewed and updated during the
79th Regular Session.
– Mergers of Power Generation Companies subject to PUC review.
• Market Design
– ERCOT will transition to a Nodal Market in 2009 as a result of PUC rulemaking.
– The change is expected to bring cost-savings and additional efficiency to the market by
enhancing market transparency and allocating costs more accurately to market
participants.
39
40. Wholesale Market
Management Outside ERCOT
• System Reliability
– Larger, multi-state Councils (SERC, SPP, WECC) oversee system reliability.
– Each is part of national reliability council.
– Protocols, approved by the Federal Energy Regulatory Commission (FERC), mandate
system reliability standards that all market participants must follow.
• Wholesale market operations overseen by FERC
40
41. Increased Population Drives
Future Electric Consumption
Texas’ Projected Population Growth
Assuming Net Migration Equal to 2000-2004
(median scenario)
50
• To meet increases in electric 45 43.6 million
load created by Texas’ rapid 40
population and economic 36.3 million
35
growth, Texas will require 30.3 million
additional power, transmission 30
and distribution, customer 25
25.1 million
demand response and energy
efficiency. 20
15
10
5
0
2010 2020 2030 2040
Source: Texas State Data Center
41
42. Electric Consumption Continues to
Grow in ERCOT
Note: The peak in electric consumption in 2000 was Source: ERCOT, “Report on Existing and Potential
due to an exceptionally hot summer. Electric System Constraints and Needs,” December
42
2010
43. Peak Demand Also Growing, Requiring
Additional Investment Long-Term
Source: ERCOT, “Report on Existing and Potential
Electric System Constraints and Needs,” December
43
2010
44. ERCOT Restructuring Spurred
Massive Generation Investment
• The competitive
market has steadily
added new
generation and
greater efficiency
to the wholesale
market.
• Generators in the
competitive market
shoulder the risk of
building new power
plants, bringing
efficient, cost-
effective
generation to
consumers.
Sources: Energy Velocity, NERC, PUC 44
45. Update on ERCOT Reserve Margins
Source: ERCOT, “Report on Existing • ERCOT recently raised its target reserve margin to 13.75% of
and Potential Electric System
Constraints and Needs,” December generation available above peak summer demand. To meet this
2010 goal, ERCOT will need additional generation in upcoming years 45
47. ERCOT Generation Mix
• The generation technology mix is an outcome of a robust competitive wholesale
market and environmental policy decisions.
• In addition to the price of fuels and the cost of technology, environmental and siting
issues impact choices made by generation developers.
• Coal, including lignite, is an important fuel in the ERCOT electric generation mix.
– Coal is the most abundant fossil fuel in the United States, with an estimated
200 year supply remaining (per the Energy Information Administration (EIA)).
– Electricity produced from Texas lignite exceeds the entire generation of 28
states individually.
• Texas lignite accounts for about 45% of the coal used in the state for electricity.
• Texas’ lignite mining industry is a key part of the state economy, providing over
33,000 permanent jobs and contributing about $10.5 billion in annual Total
Expenditures.
• The existing framework of Texas’ competitive wholesale electric market has helped
lead generators to invest in and announce plans for over 23,000 MW of new
generation, including natural gas, coal, nuclear and renewable power.
Sources: EIA, National Mining Association, The Perryman Group, PUC 47
48. ERCOT Generation Mix
In 2009
Source: Public Utility Commission of Texas (PUC) Chair Barry Smitherman Presentation to the Gulf Coast Power Association, Oct. 6, 2009 48
49. ERCOT Generation Mix
In 2013
Assuming 18,000 MW of wind, approximately 5,600 MW of new
coal, 4,300 MW of new natural gas
Source: Public Utility Commission of Texas (PUC) Chair Barry Smitherman Presentation to the Gulf Coast Power Association, Oct. 6, 2009 49
50. Gas on the Margin in ERCOT
Year-Round
Demand Curve - Winter Scenario Demand Curve - Summer Scenario
60000 60000
50000 50000
40000 40000
MW Load
MW Load
30000 30000
20000 20000
10000 10000
0 0
0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23
Hour Hour
Nuclear Coal Wind Natural Gas Nuclear Coal Wind Natural Gas
Examples are purely illustrative
• There are multiple types of power plants with different operations in ERCOT that are operated
on different schedules.
– Because of their lower marginal costs, nuclear and coal-fired power plants in ERCOT operate
approximately 90 percent of the time.
– In contrast, natural gas-fired power plants are ramped on and off, depending upon demand.
– Wind-generated electricity is only intermittently available, depending on wind conditions.
• Some natural gas-fired generation is required to operate at all times in the ERCOT region to
meet demand.
– Natural gas-fired generation sets the market price of wholesale electricity in ERCOT.
– Natural gas-fired units that are used to meet peak demand tend to be older units that cost more to 50
operate.
51. Business Climate for Generators
in ERCOT
• In ERCOT, generation companies assume all of the financial risk included in a new generation
projects.
• The decision to build new generation thus depends upon whether the generator believes the
electricity can be sold at a price to recoup construction costs, cover operations and
maintenance costs and achieve a profit.
• Market forces have been effective in bringing new generation to the state, with over 37,063
MW of generation constructed since the advent of wholesale competition in 1995. Another
4,433 MW of new generation is under construction, according to the PUC.
• While not all is expected to the built, the PUC reports substantial new generation has been
announced, including:
– 4,815 MW of new coal-fired generation
– 5,900 MW of new nuclear generation
– 7,172 MW of new wind-powered generation
– 8,418 MW of new natural gas-fired generation
• Though such news is positive, market forces and legislative and regulatory certainty will
ultimately dictate how much of the announced new generation is actually built.
Data source: PUC, “New Electric Generating Plants in Texas,” updated April 30, 2009 51
52. Texas Has the Most Installed
Wind Energy Capacity
27% of the nation’s installed wind generation capacity
is located in Texas.
Source: American Wind Energy Association, September 2010 52
54. Three Key Factors Affecting Choices
for New Generation
Wholesale
Market
Cost of Construction and Fuels
54
55. Coal-Fired Generation
Type of Generation
+ Coal-fired plants provide baseload generation, by running
approximately 90 percent of the time.
Environmental Issues
- Greater air emissions than natural gas-fired plants, including
rate of about twice the CO2 per kWh generated.
- Risk of higher costs due to future carbon-capture
requirements.
Cost of Construction and Fuels
+ Currently, pulverized coal generation is economical to build based on current
natural gas prices.
+ Long-term domestic supply of coal, including lignite.
+ Fuel cost is relatively low
- High initial capital costs relative to natural gas-fired plants.
55
56. Natural Gas-Fired Generation
Type of Generation
- Natural gas plants, such as combined-cycle plants, can
provide baseload generation, but demand conditions in
ERCOT result in a lower capacity factor than for coal-fired
or nuclear-powered generation.
+ Other simple-cycle natural gas plants have quick start-up
and shut-down times to allow them to meet peak demand.
Environmental Issues
+ Lowest air emissions among fossil fuels.
+ Newest power plants operate more efficiently, burning less
fuel per MWh of generation.
Cost of Construction and Fuels
+ Low initial capital costs.
- When natural gas prices are high, gas-fired power plants are expensive to operate.
56
57. Nuclear-Powered Generation
Type of Generation
+ Nuclear-powered plants provide baseload generation by
running approximately 90 percent of the time.
Environmental Issues
+ No air emissions.
- Long-term storage of waste needs to be implemented.
- Historic concerns regarding public perception of safety of
nuclear power.
Cost of Construction and Fuels
+ Lowest fuel cost of all large-scale generation.
- High capital costs.
- Longest permitting and construction times among generation types.
57
58. Wind-Powered Generation
Type of Generation
+ Wind is plentiful in certain parts of Texas.
- Wind blows intermittently, making it a less reliable power
source.
Environmental Issues
+ No air emissions.
- Can affect migratory birds.
- Concerns about aesthetic impact.
Cost of Construction and Fuels
+ No fuel cost.
- Limited ability to replace other generation to satisfy reserve margins.
- Imposes other costs on the system, such as increased ancillary service
requirements, backup capacity and the need for transmission lines to reach rural
wind farms.
58
59. Solar Generation
Type of Generation
+ Solar power is generally reliable, but intermittent, as it
depends on certain levels of sunlight.
- Plants are generally small in scale.
Environmental Issues
+ No air emissions.
- Large areas of land needed for effective solar arrays.
Cost of Construction and Fuels
- Can have 15 to 20 times the capacity cost of natural gas-fired generation
+ No fuel cost.
- Cannot be used to replace other generation to satisfy reserve margins.
- Imposes other costs on the system, such as the need for transmission lines, since
large-scale solar power plants would be located in areas far from population
centers.
59
60. Biomass and Landfill Gas
Generation
Type of Generation
+ Biomass and landfill gas generation generally operates
reliably.
- Plants are generally small in scale.
Environmental Issues
- Plants burning biomass can have high CO2 emissions.
+ Landfill gas facilities reduce methane greenhouse gas
emissions.
- Generation is difficult to permit and site.
Cost of Construction and Fuels
- Requires high capital and operating costs when compared with fossil fuel-fired
generation
- Often located far from population centers, requiring high transmission costs
60
61. Hydroelectric Generation
Type of Generation
+ Hydroelectric power is reliable to operate, except during
drought.
- Texas has very little potential for new hydroelectric power
generation.
Environmental Issues
+ No air emissions.
- Can kill fish.
Cost of Construction and Fuels
+ Once built, hydroelectric power is among the least expensive forms of power, as it
has no fuel costs.
- High capital costs
61
62. Energy Efficiency and
Demand-Side Management
Type of Technology
+ Several cost effective solutions available.
- Success requires broad implementation.
Environmental Issues
+ Reduces emissions that would otherwise accompany fossil
fuel usage.
Cost of Construction and Fuels
+ Can improve cost levels for residents and customers.
+ Reduces need for building new power supply.
62
64. Texas Is Already Leading the
Way in Clean Power Plants
Texas has the largest emissions of any state since
it produces ~80% more power than the next ranked state.
0.234
0.351 OK 0.198
NM AR
0.142
0.098 LA
TX
2009 NOx Emission
Rate Averages (lbs/
Area mmBtu)
National 0.159
Texas 0.098 64
EPA Clean Air Markets Division – 2009 Acid Rain Program Data
65. Electric Generator-
NOx Reductions Achieved Under
TCEQ 1-hr Ozone SIP Rules
– HGA SIP- 86% overall reduction from 1997
– DFW SIP- 88% overall reduction from 1997
– Beaumont SIP- 45% reduction from 1997
– East Texas SIP- 51% reduction from 1997
Between 2000 and 2005, electric generating
companies in Texas spent over $1 billion on NOx
emission reductions alone.
65
66. Texas’ Electric Generating Plants
Among Cleanest NOx Emitters in
the Nation
Texas has the 11th
cleanest average NOx
NOx (lb/MMBtu)
emissions rate.
U.S.
Average-0.159
lb/mmBtu
66
EPA Acid Rain Database, 2009
67. Average Emission Rates of Nitrogen
Oxides from Existing Texas and U.S.
Power Plants
NOx (lb/MMBtu)
Notes:
NOx Emission Rates for New Coal-Fired Power Plants range from 0.05 to 0.08 pounds per million Btu
NOx Emission Rates for New Gas-Fired Power Plants are approx. 0.015 pounds per million Btu
67
Source: EPA Acid Rain Database, 2009
68. Texas’ Electric Generating Plants
Among Cleanest SO2 Emitters in
the Nation
Texas has the 24th
cleanest average SO2
SO2 (lb/MMBtu)
emissions rate.
U.S.
Average-0.458
lb/mmBtu
68
EPA Acid Rain Database, 2009
69. 1995-2009 Emission Rate Trends
Sulfur Dioxide Nitrogen Oxides
(SO2) (NOx)
lb./mmBtu lb./mmBtu
Year Nation Texas Nation Texas
1995 1.086 0.517 0.551 0.313
1996 1.096 0.527 0.518 0.314
1997 1.093 0.523 0.509 0.310
1998 1.058 0.485 0.481 0.307
1999 0.999 0.481 0.440 0.286
2000 0.875 0.380 0.399 0.261
2001 0.843 0.385 0.373 0.221
2002 0.794 0.384 0.348 0.173
2003 0.815 0.390 0.320 0.142
2004 0.779 0.353 0.286 0.124
2005 0.753 0.349 0.268 0.116
2006 0.702 0.338 0.255 0.111
2007 0.644 0.321 0.237 0.103
2008 0.564 0.316 0.222 0.103
2009 0.458 0.309 0.159 0.098
1995 - 2002 data are from the Acid Rain Program Scorecard Table B1
69
2003 - 2009 data are from the Clean Air Markets Division database for the Acid Rain Program
70. CO2 Emissions in
Context of Texasʼ Economy
A common refrain is that CO2 emissions generated in Texas are higher than in
other states. However, it is critical to view that in the context of other truths:
− Texas generates more electricity than any other state; in fact, Texas produces almost
80% more electricity than the next most generating state.1
− Much of the CO2 emitted in Texas results from the generation of “products” that are
very significant to our state and nation. For example, Texas produces about:
− 60% of petrochemicals produced in the U.S.
− 30% of gasoline and diesel refined in the U.S.
− 10% of electricity generated in the U.S.
− The dollars of gross product produced in Texas per ton of CO2 emitted is high, and it
increased by more than 1000% between 1963 and 2001.
− The ratio of the amount of CO2 emitted per MWh of electricity generated in Texas is
lower than half of the states that have more than a nominal amount of coal-fired or oil-
fired electricity generation (see previous slide).
1Source:
70
EIA, 2008 State Electricity Profiles
71. Technical Feasibility of
CO2 Reductions
Technology EIA 2008 Reference Target
Efficiency Load Growth ~ +1.05%/yr Load Growth ~ +0.75%/yr
Renewables 55 GWe by 2030 100 GWe by 2030
Nuclear
15 GWe by 2030 64 GWe by 2030
Generation
No Heat Rate Improvement 1-3% Heat Rate Improvement
Advanced Coal for Existing Plants for 130 GWe Existing Plants
Generation 40% New Plant Efficiency 46% New Plant Efficiency
by 2020–2030 by 2020; 49% in 2030
CCS None Widely Deployed After 2020
10% of New Light-Duty Vehicle
PHEV None
Sales by 2017; 33% by 2030
DER < 0.1% of Base Load in 2030 5% of Base Load in 2030
Chart Source: EEI and EIA
71
72. Additional
Emission Reductions
Federal Clean Air Interstate Rules (CAIR)
− Requires additional NOx and SO2 emissions reductions from power plants in
2009, 2010, and again in 2015, with a cap and trade program.
− The NOx and SO2 emissions from all new units must “fit” under the 2009, 2010,
and 2015 caps; such emissions are not in addition to those caps.
− TCEQ has recently revised its rules to implement CAIR.
Regional Haze
− Requires reductions in NOx, SO2, and Particulate Matter (PM) emissions based on
best available retrofit technology (BART) for different types of facilities, including
electric generating units, industrial boilers, and refineries.
− EPA has decided that NOx and SO2 emissions reductions made for CAIR will
suffice for the NOx and SO2 emissions reduction requirements under Regional
Haze.
− The TCEQ is developing rules to implement BART.
72
73. Giving Back to the
Environment
• AECT member companies help to improve our environment through stewardship,
support for new technologies and partnership with other agencies.
Environmental Stewardship
Environmental Partnerships
- Reducing releases of chlorofluorocarbons from - Climate Challenge Program
electrical equipment - Energy Star
- Recycling coal combustion products - Energy Smart Schools
- Educating schools and communities about - Environment Research Program
renewable energy
- Designating land and reservoirs for public - EPA SF6 Partnership program
recreational use - Mickey Leland Internship Program
- Preserving and restoring forests by planting - TCEQ Teaching Environmental Science
millions of trees - Green Lights
- Helping other industries adopt pollution- - Habitat Protection
prevention plans - Learning From Light!
- Launching education campaigns to help - Millennium Council
communities save energy - Million Solar Roofs
- Creating wetlands and wildlife habitats on - National Energy Education Development
company properties (NEED) Project
- Natural Gas Star
- Reclaimed water utilization
- Offering renewable energy products to retail
customers
73
74. Selected Environmental
Programs and Fees
• The electric industry is among the most heavily regulated in the nation, complying
with hundreds of regulations and paying millions of dollars in fees annually.
Selected Current Selected Current
Environmental Programs
Environmental Fees
- Compliance with National Ambient Air Quality - Title V federal operating permit fees
Standards
- Air inspection fees
- State Implementation Plan
- Air quality permit fees
- NOx reductions for electric generating units
- Air quality permit renewal fees
- Clean Air Interstate/Clean Air Mercury Rules
- Wastewater inspection fees
- New Source Review (NSR) - Wastewater permit application fees
Prevention of Significant Deterioration
- Water quality fees
- Non-attainment NSR, including offset
- Potable water fees
- State Minor NSR
- Water use permit application fees
- Title V and Acid rain permits
- Hazardous waste generation fees
- Compliance Assurance Monitoring
- Non-hazardous waste fees
- Continuous Emissions Monitoring Systems
- Low level radioactive waste fee
- Toxic Release Inventory
- Injection well fee
- Monitoring cooling water
- Mass Emission Cap and Trade Program
74
76. TDUsʼ Role in the Competitive ERCOT
Market
• Transmission and Distribution Utilities:
– Provide reliable delivery of electricity on a 24-7 basis.
– Invest in and build infrastructure (e.g., transmission lines, Smart Grid) to support
the needs of Texas’ growing economy.
– Manage their transmission networks under the direction of ERCOT; coordinating
with ERCOT on transmission planning activities.
– Respond to outages (e.g., storms, natural disasters) that affect the grid and restore
service as quickly as safely possible.
– Provide key market information, such as premise information and metering
services to facilitate successful operation of the ERCOT deregulated market.
– Provide regulated transmission and distribution services to facilitate operations of
wholesale and retail business entities.
– Charge regulated delivery rates to REPs
Rates based on a historical cost of service including a PUC-established return on capital
investment
Allocation of ERCOT-wide transmission costs
Non-bypassable charges include the cost to deliver electricity, System Benefit Fund,
recovery of true-up costs and nuclear decommissioning expenses for existing nuclear
facilities
76
77. TD Market Design:
ERCOT
• ERCOT Transmission
– 1995 amendments to the Public Utilities Regulatory Act (PURA) required PUC to
ensure open access to transmission grid, allowing new independent generators to
utilize transmission network.
– TX76RSB 7 adopted “postage stamp” transmission pricing structure and eliminated
impact of location on transmission rates.
– Transmission Cost of Service (TCOS) ratemaking structure implemented and billed
to distribution service providers (DSP).
– DSPs recover TCOS through the TDSP delivery rate and transmission cost recovery factor
(TCRF), approved by PUC.
– New transmission investment is coordinated through the ERCOT regional
transmission planning process and requires PUC facility certification.
77
78. Transmission Investment in Texas
• Since 2009, TDUs have
invested over $2.0 billion in
the ERCOT transmission
grid.
• ERCOT estimates that the
electric grid will require
adding or improving 5,993
circuit miles of transmission
lines at a cost of over $9.0
billion from 2011 through
2016 and beyond.
• This investment includes
the cost of integrating
Competitive Renewable
Energy Zones (CREZs) into
the competitive ERCOT
Source: ERCOT, “Report on Existing and Potential Electrical System market.
Constraints and Needs,” December 2010 78
79. Continued Transmission and Distribution
Investment Needed Throughout Texas
• According to the Texas State Data
Center, 5 million new residents are
expected in Texas by 2020.
• New generation must be delivered
effectively and efficiently to
population centers of the state.
• Texas must provide regulatory
certainty and fair rates of return to
ensure appropriate capital
investment.
• Though not shown here, areas of
Texas located outside the ERCOT
grid are also growing, both in terms
of population and economic
development.
Source: ERCOT, “Report on Existing and Potential Electric
System Constraints and Needs,” December 2010
79
80. Challenges of Transmission
Line Construction
Example of Transmission Construction Process in ERCOT
• While certain types of generation can be constructed quickly -- often as short as 12-18
months -- transmission lines typically take between three and five years. Generation can be
brought into the market more rapidly if the siting takes advantage of the existing transmission
infrastructure.
• Building long transmission lines can affect many landowners, often requiring a lengthy and
extensive easement acquisition effort.
• The transmission line siting process must take into account the impact of those lines on
environmentally sensitive and historically significant lands.
• Utility is not typically allowed to begin recovering costs until year 5 or 6. 80
81. Distribution Investment
Also Needed
• The need to replace an aging distribution
infrastructure to meet population and demand
growth will require continued investment.
• It is becoming more evident that rising construction
material costs are an increasingly important driver
contributing to the higher actual and planned utility
industry infrastructure investments.
• Nationwide, distribution investment is expected to be almost triple the size of
projected transmission spending, according to the Edison Electric Institute.
Distribution investment is likely to exceed generation and environmental capital
spending, as well.
81
82. TD Market Design:
Non-ERCOT
• Non-ERCOT Transmission
– Wholesale open access transmission rights subject to Federal Energy
Regulatory Commission (FERC) jurisdiction.
– FERC transmission pricing reflects location of generation.
– FERC requires generators to bear higher cost relative to the ERCOT
system of connecting with the transmission grid.
– Certification in Texas is with the PUC.
– Recently adopted PUC rules allows most non-ERCOT utilities to recover
transmission investments between rate cases through a transmission cost
recovery factor (TCRF).
82
83. Competitive Renewable Energy Zones:
Legislative and Regulatory Steps
• The Texas Legislature mandated steady increases in renewable power in
TX76RSB 7 (1999) and TX791RSB 20 (2005).
– Starting Line: 880 MW in 1999
– Old Goal 1: 2,880 MW by 2009 (Achieved by 2007)
– New Goal 1: 5,880 MW by 2015
– New Target 1: 10,000 MW by 2025
– New Target 2: 500 MW non-wind renewable generation
• TX791SB 20 (2005) also required PUC to:
– designate Competitive Renewable Energy Zones (CREZs) in areas in which renewable
energy resources and suitable land areas are sufficient to develop generating capacity
from renewable technologies;
– develop a plan to construct necessary transmission capacity in a manner that is most
beneficial and cost effective to customers; and
– take into account transmission constraints, the need for generation and the level of
financial commitment by generators when defining CREZs.
• PUC adopted Substantive Rule 25.174 in December 2006, which creates
framework for determining CREZs.
• Texas currently has 9,727 MW of installed renewable generation capacity
(September 2010). 83
86. Energy Efficiency in Texas:
Overview
• Texas continues to be an energy leader through policies designed to improve the stateʼs
energy efficiency programs and bring improved technologies to the electric market.
– Utility-run programs have reduced customer consumption, thereby reducing the need for the
construction of new generation.
– Advanced metering provides information and opportunities that enable customers to take better
control of their energy consumption and bills.
– Houston and Dallas-Fort Worth ranked 1 and 2 nationally in number of homes that qualified for EPAʼs
“Energy Star” designation.
• The Texas Electric Choice Act requires electric utilities to provide energy efficiency
programs and incentives, including efficiency programs for low-income customers.
– TX80RHB 3693 raised the energy efficiency goal for electric utilities from 10% of annual demand
growth to 15% in 2008 and 20% in 2009.
– The recent PUC recently passed a rule requiring utilities to offset 30 percent of their projected growth
in demand by 2013.
• ERCOT competitive retailers are developing innovative plans and products that will help
customers use less energy (e.g., customer education programs, energy audits, Internet-
controllable thermostats, etc.)
86
87. Energy Efficiency Programs
Have Exceeded Goals
Total Energy Savings by Investor-Owned Utilities
2003 - 2009
• In 2009, utilities in Texas exceeded their statewide legislative energy efficiency goals for the seventh
straight year. Utilities achieved 240 MW of peak demand reduction in 2009, which was 82% above the132
MW goal.
• Energy savings from standard offer programs and market transformation programs resulted in an
equivalent reduction of 827,409 pounds of nitrogen oxide emissions per year.
• Since the start of the state’s energy efficiency program in 1999, utilities have achieved 1,365 MW of peak
demand reduction and 3,574 GWh of electricity savings.
Source: Frontier Associates LLC, “Energy Efficiency Accomplishments of Texas Investor Owned Utilities, Calendar Year 2009” 87
88. TX80RHB 3693:
Enhancing Energy Efficiency
TX80RHB 3693 included a host of programs designed
to help reduce electricity usage in Texas.
• Raises energy efficiency goal for electric utilities from 10% of annual demand growth to 15%
in 2008 and 20% in 2009.
• PUC will study energy efficiency programs by January 15, 2009, and submit a report to the
legislature.
– The study shall address whether utility energy efficiency programs should continue and whether
energy efficiency programs are best provided by the competitive market.
– The findings of the study will determine whether a goal increase to 30 percent is achievable by 2010
and 50 percent by 2015.
• PUC will work with ERCOT to develop a method to account for projected energy efficiency
impacts in ERCOTʼs forecasts of future capacity, demand, and reserves.
88
89. TX80RHB 3693:
Enhancing Energy Efficiency
• The bill also includes:
– an energy efficiency cost recovery factor;
– a utility financial incentive for exceeding goals; and
– the ability for utilities under a rate freeze to defer recognition of these costs.
– Provisions aimed at reducing energy consumption by schools and government
buildings.
– Stronger, more energy-efficient building standards for low-income housing.
– Creates an annual sales tax holiday during Memorial Day weekend for energy efficient
products that bear the designation of the nationwide “Energy Star” program.
89
90. Benefits of Advanced Metering
• Advanced meters and other new technologies
and associated infrastructure will provide information
and opportunities that will enable customers to better
understand the impact of controlling their energy
consumption.
• By controlling their energy consumption, customers
can better manage their bills and lessen their
environmental impact.
• Advanced meters will allow for more automation of utility functions such
as meter reading and connections/disconnections, which help to reduce
costs.
90
91. The Smart Grid Transforms the Way
We Buy, Deliver and Use Electricity
Key Stakeholder Benefits
• Automated meter reading
Electric • Improved system reliability and greater ease/timeliness of power restoration
• Improved line fault detection and diagnostics
Utility • Real time grid feedback allows for more effective loading of utility assets
• Enables increased monitoring and diagnostics to enhance the life of utility assets
• Electric reliability improvements
• Friendly access to detailed consumption information to make informed choices
Consumers and enable faster transactions
• Enables and promotes energy conservation
• Efficient switching and connections/disconnections
• Expands retailer’s ability to offer new products
• Establishes platform to offer future home appliance monitoring and control
Retailers • Allows retailers to offer pre-payment programs
• Efficient switching and connections/disconnections
• Enables demand-side management
• Facilitates integration of solar and wind generation into grid
Environment • Promotes energy efficiency through immediate energy consumption awareness
• Facilitates reduced electric consumption which leads to reduced power plant
emissions
91
92. Advanced Metering Activities
in Texas
• The approved deployment plan for CenterPoint Energy calls for
installation of advanced meters over five years beginning in March
2009. In 2009, CenterPoint Energy received a Federal Smart Grid
Investment Grant that enables the deployment to be completed by late
2012. Through October 2010, CenterPoint Energy has installed
789,857 advanced meters.
• Oncor’s approved deployment plan initiated in late 2008 will have
installation of advanced meters completed by the end of 2012. To date,
Oncor has installed over 1.4 million meters.
• The AEP Texas deployment plan was approved in December 2009 and
installation of advanced meters will be completed by the end of 2013.
To date, nearly 5,000 meters have been installed in Portland, Texas, in
order to conduct a system acceptance test.
92
94. The ERCOT Competitive Retail Electric
Market is Providing Strong Customer
Benefits
Key Takeaways
– Price offers are lower than they were one year ago, and, when adjusted for
inflation, substantially lower than prices available just before competition
began.
– Retail electric price offers have improved, despite the increased price of
energy commodities, such as gasoline, crude oil, natural gas and coal.
– Among states, like Texas, that depend heavily on natural gas for power
generation, Texas prices compare favorably, with even lower prices available
to those in the competitive market.
– Since January 2007, the average fixed offer price in the competitive market
has fallen by 28 percent, while the average U.S. electric price has risen by 19
percent.
– The System Benefit Fund (SBF) provided benefits for low-income Texans
during the summer. Several retailers, including AECT member companies,
also offer additional low-income customer assistance programs, so customers
should also contact their REP to learn more about the options that might be
available to them.
94
95. Better Prices Available Today
Than One Year Ago
Source: www.powertochoose.org; prices are a simple average among service territories. 95
96. Lower inflation-adjusted prices available
today than before competition began
Sources: PUC Historical Data, Bureau of Labor and Statistics, www.powertochoose.org offers as of December 15, 2010 96
97. Competitive Residential Electric Price Offers
Have Fallen Since Full Competition Began
in January 2007
Texas-New Mexico Power Co.
AEP Texas North
Service Territory
Service Territory
Change in Average
Change in Average
1yr Fixed-Price Offer: 1yr Fixed-Price Offer:
33% decrease 28% decrease
Oncor
Service Territory
Change in Average
1yr Fixed-Price Offer:
29% decrease
CenterPoint Energy
Service Territory
AEP Texas Central Change in Average
Service Territory 1yr Fixed-Price Offer:
27% decrease
Change in Average
1yr Fixed-Price Offer:
23% decrease
Since January 2007, competitive price offers for
residential customers have fallen in every service area.
Source: http://www.powertochoose.org (1/1/07 12/15/10) 97
98. Texasʼ National Price Ranking Has Improved
With Competition Despite Input Fuel Cost
Increases AND Customers Can Choose
Plans To Meet Their Needs
18
2001 State Ranking (Pre-Competition)
16
¢/kWh
14
12
10
8
6
4
2
0
KY
WA
WV
WY
MT
MO
OK
MS
GA
VA
WI
MI
AZ
IA
TX
PA
AK
MA
VT
ME
ID
OR
AL
LA
NJ
TN
NE
UT
IN
SD
CO
MN
KS
MD
SC
AR
OH
FL
DE
IL
NM
NV
CT
CA
RI
NY
HI
ND
DC
NC
NH
September 2010 State Ranking (Latest Available)
Average lowest
available offer in
competitive
market in
Sept. 2010:
8.1/kWh
¢/kWh
Source: EIA average annual residential rates for 2001 and September 2010 monthly data (latest available information). Average lowest available price from
powertochoose.org Web site as of 9/13/10 for a residential customer using an average of 1,000 kWh per month.
98
99. Every Competitive Area in ERCOT Has
Variable and 1-Year Lock Offers Available
that are Lower than the National Average Price
Sources: PowerToChoose.org offers as of September 13, 2010,
U.S. Energy Information Administration, latest available data
99
100. Offers in Competitive Areas Compare Well
With Prices in Other Areas of the State With
Other Market Structures
¢/kWh
Sources: Phone surveys conducted September 17, 2010; Power to Choose
100
Web site, September 20, 2010; AECT member company data
101. Retail Electric Prices Have Grown
Far Less Than Other Energy
Commodities
Percentage Change in
Commodities
December 2001 – December 2010
Sources: Public Utility Commission of Texas, U.S. Energy Information Association, NYMEX Commodity Exchange, Bureau of Labor Statistics.
Notes: Commodity prices latest available as of December 15, 2010.
Inflation covers period from 2001 to 2010 101
102. ERCOT Generation Mix More Gas-
Heavy than U.S. Average
ERCOT U.S. Average
Other
Energy (MWh)
Wind Renewable Other
7% 2% (Mostly Hydro) 2%
Natural Gas
Nuclear 10% 23%
Nuclear
15%
40% 20%
36%
Natural Gas 45%
Coal
Coal
Other
Wind Oil
3%
Renewable
10% (Mostly Hydro) 3%
Capacity (MW)
Nuclear Natural Gas
6% 17%
39%
16% Nuclear 10%
Coal
65%
31%
Natural Gas
Coal
Note: Oil-fired generation is negligible in ERCOT, accounting for less than 0.1% of ERCOT capacity and load; numbers may not add
up to 100% due to rounding.
Sources: ERCOT (summer data), EIA (2009 data, latest available) 102
103. Texas Market Compares Favorably to Other
States Utilizing Natural Gas as the Primary
Generation Source
Average Lowest Available
Price in ERCOT Competitive
Market In September 2010:
8.1¢/kWh
Sources: Energy Information Administration (data as of September 2010); EIA natural gas-intensive states;
powertochoose.org as of 9/13/10.
Note: Texas statewide average price includes prices from both competitive and regulated areas of the state.
103
104. Competitive electricity prices still track
natural gas, but enable customer choice
and lower prices
Natural Gas vs. Texas Residential Retail Electricity NYMEX Average 12-Month Strip
Prices In Areas Now Open to Competition
1992 – 2010 YTD; $/MMBtu and ¢/kWh
Before Electric With Electric Average Competitive Offer
Competition Competition
NYMEX Natural Gas, 12-month Strip Residential Electricity Price
Annual Average ($/MMBtu) Annual Average (¢/kWh)1
‘02-08 Natural Gas Avg:
¢
$7.14/MMBtu (+238%)
¢
‘92-99 Natural Gas Avg: ¢
$2.11/MMBtu
¢
¢
¢
1 Average annual residential electric prices at 1000 kWh/month in the 5 TDU areas opened to competition in 2002; pre-competition prices based on filed tariffs; post-
competition prices based on Power to Choose offerings and PUC data. Sources: NYMEX, PUC, Power to Choose website (latest data as of 10/11/10) 104
104
105. Since January 2007, Texasʼ Prices Have
Remained Steady While Others Have Risen
Restructured
US Average States
(excl. TX) (excl. TX)
Gas-Dependent 19% 23%
States (excl. TX)
4%
Texas
-1%
Lowest Competitive
Offer Prices in Texas
-22%
Source: EIA average annual residential rates for January 2007 and August 2010 (latest available usage data),
powertochoose.org for January 2, 2007 and August 11. 2010 105
106. Protections in the Market for
Retail Customers
Among other requirements, REPs serving residential customers must:
• Register with the PUC and meet financial • Make Spanish-language support available to
requirements set by the Commission customers
• Communicate clearly with consumers regarding • Place customer deposits in interest-bearing
notice of contract expiration accounts and return that interest to customers when
• Demonstrate creditworthiness to purchase power the deposit is returned
to serve its customers • Follow a mandated timeline for disconnection of
• Demonstrate the technical ability to supply customers
electricity • Provide notice in case of disconnection
• Maintain privacy of customer information • Investigate any customer complaint within 21 days
• Not discriminate among customers • Provide a Terms of Service Statement detailing
• Not add charges to a customer’s electric bill for contract terms, cancellation penalties, deposit
services not requested by the customer requirements, fees, payment arrangement options,
• Provide a “Your Rights as a Customer” disclosure how to cancel service, and other obligations of the
REP
• Provide an Electricity Facts Label to allow for an
• Allow a customer to cancel a service agreement
“apples-to-apples” comparison among REPs
within three federal business days after receiving
• Make deferred payment plans available for those
the terms of service
expressing an inability to pay
• Allow a customer to cancel the switch upon
• Provide the LITE-UP discount for low-income receiving notification that the switch will occur
Texans during summer months
Even this brief sampling of regulations
highlights that customers are protected
106
107. Benefits for Qualified
Low-Income Customers:
The System Benefit Fund
• The System Benefit Fund (SBF) was enacted as part of the Texas
Electric Choice Act in 1999. It is intended to provide funding specifically
for:
– assistance to low-income customers through reduced electric rates;
– weatherization programs; and
– administrative funding.
• The PUC approved the utilization of the $80 million of SBF funds
authorized by the 80th legislature.
– These funds will be used to provide a discount to low-income customers in
the competitive areas of the state.
– During the months of May through September, eligible low-income customers
will receive an approximate 20 percent discount through the “LITE-UP Texas”
electric discount program.
107