Texas lawmakers grill state energy leaders over plans to overhaul electricity market

AUSTIN, Texas - Texas lawmakers grilled state energy leaders Thursday over plans to overhaul the electricity market.

It comes a week after the state’s Public Utility Commission revealed new proposals that would change how electricity is bought and sold.

While the state has made improvements to harden physical infrastructure, the work underway now is to improve the market for buying and selling. These are complicated proposals, and lawmakers appeared skeptical this week about some of those plans.

With a new legislative session approaching with the new year, the Texas Senate’s Business and Commerce Committee took a look Thursday at what energy regulators have been working on lately to improve the grid.

Specifically, a study the Public Utility Commission released last week, by a group called E3, looking at ways to re-think the market.

Some lawmakers weren’t happy that none of the consultants who did the study showed up.

"I think the fact that E3 was not there and all of us were asked to look at this study, you’re going to present proposals, the fact that they’re not there to explain their research and process is bad form," said State Sen. Donna Campbell/(R) New Braunfels.

A Public Utility Commission spokesperson told FOX 4 the consultant could not make the meeting because of a scheduling conflict. 

RELATED: Regulators reveal study on ideas to make Texas power grid more reliable

Lawmakers also questioned whether the proposals really would incentivize more power generation in Texas.

"In looking at the E3 report, there’s a number of proposals that Chairman Lake, you say guarantee new dispatchable generation, requiring new thermal generation," said State Sen. Charles Schwertner (R), who is the chairman of the Senate Business and Commerce Committee. "To be quite frank, I don’t see their projections. 5.6 gw, but I don’t see requirement for new generation."

Last week, Public Utility Commission Chairman Peter Lake FOX 4’s Blake Hanson that a proposal he’s championing, called a performance credit mechanism, would improve reliability.

"Our analysis, that we published today, shows that by implementing a reform like that, we can achieve a ten times improvement in reliability for little to no additional cost for consumers. It was an outstanding outcome and a remarkable tradeoff for the right payers in Texas," he said.

But even E3 recognized that plan presents risks because it’s a novel concept.

It all comes as we head into another winter.

Federal regulators have warned in a report that the grid would still be vulnerable if another storm hit like what we saw in 2021.

State regulators disagree with the report, but acknowledge there could still be problems.

"But in the most extreme of cases, there is a risk, if there’s not all of the capacity on a system available to run, including intermittent and the dispatchable generation, there could be a gap," ERCOT CEO Pablo Vegas said.

The Public Utility Commission is currently accepting comments from the public on some of the proposed changes.

People have until mid-December to weigh in.