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ERCOT Market Overhaul Will Leave Texans With $460 Million Bill

Officials are one step away from approving a Texas power market overhaul that is likely to further increase Texans’ monthly electricity bills.

The Texas Public Utilities Commission voted Thursday to approve a plan that the agency says will make the state’s power grid more reliable, according to a PUC announcement Thursday.

The plan, which is far from detailed, includes power generators that commit to producing extra power during periods of extreme heat or cold when energy demand rises. Power companies that are committed to increasing electricity production during times of high demand will sell credit to municipal utilities, cooperatives and power retailers, who in turn sell the power to the consumer.

The credit system aims to boost producers’ incomes during periods of high demand and reduce the price spikes that occur when demand is especially high.

PUC Chairman Peter Lake said in a memo on Wednesday that “a restructuring of the market in the form of a new reliability service is required to generate the revenue needed to create new manageable capacity in the ERCOT market.”

However, market restructuring will come at a cost. According to an analysis by consulting firm E3, the plan will require about $460 million to implement, a price tag that will be forced on consumers in the form of higher monthly energy bills.

“Consumers end up paying for [the plan]and I think $460 million is pretty low,” energy analyst Doug Levin, host of the Texas Power podcast, told KHOU.

Overhaul Not Completed: Texas Legislators Will Have the Opportunity to “Revisit [the plan] and its guidelines and provide guidance” before regulators can implement it, according to the PUC on Thursday.

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