According to Bloomberg article published on April 11, 2023, major Texas power generators including NRG Energy Inc. and Vistra Corp. are one step closer to reaping $500 million in new revenues after a rule change was voted through by a key stakeholder group on the state’s grid operator.
On Monday, members of the technical advisory committee of the Electric Reliability Council of Texas voted to set price floors for power costs when reserves fall below a key threshold. While the change would only come into play about 8% of the time based on current conditions, it’s enough to raise consumers’ costs by half a billion dollars annually.
Ercot’s board and the utility commission could vote as early as next week to approve the measure.
The move is part of a larger effort in Texas to improve the electric grid after its deadly failure in 2021. The state’s Republican lawmakers have put forward plans to overhaul a grid increasingly reliant on renewable energy with fossil fuel plants, and regulators are working to make Texas more compelling as a place to build natural gas plants. Of the $500 million in increased revenue, about 80% would go toward what Ercot dubbed “dispatchable resources,” or power generation that can be called up in real time such as natural gas, coal and nuclear, according to a presentation Monday.
- Under the proposal, price floors would be set at $10-$20 a megawatt-hour when real-time reserves fell below 7,000 megawatts.
- Twenty-one, or 78%, of the members of Ercot’s technical advisory committee voted for the measure
