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Texas Senate Approves Bill in Response to February Electricity Crisis

March 30, 2021
Texas faced a fiasco in mid-February when extreme weather conditions caused forced blackouts as a result of a systemic and multifaceted failure.

The Texas Senate yesterday unanimously approved Senate Bill 3, which calls for winterization of infrastructure and an overhaul of the state’s electricity market. The Bill would also formalize the Texas Energy Reliability Council and require it to meet twice a year.

Texas faced a fiasco in mid-February when extreme weather conditions caused forced blackouts as a result of a systemic and multifaceted failure. One of the problems seemed to be that power plants weren’t fully weatherized, wiping out generation capacity. The ones that were still standing struggled to get enough fuel, with shale wells experiencing so-called freeze-offs. A few wind turbines stopped spinning. Texas, with a grid notoriously isolated from the rest of the U.S., was unable to call on neighboring states for help. A lot of accusations and blame are still flying around; FERC and NERC has opened a joint inquiry into the operations of the bulk-power system during the extreme winter weather conditions.

Republican Senator Charles Schwertner filed the bill, and now it heads to the Texas House, “where its prospects are uncertain,” according to the report from the Texas Tribune. The newspaper published a detailed report on March 29, saying the House was expected to take up a series of related, standalone bills today.

The Bill would require utilities and companies to weatherize power generation plants, transmission lines, natural gas facilities and pipelines.

“The Texas system was simply not prepared for the cold, despite having experienced freezing temperatures in 2011 that saw gas wellheads lock up and coal plants seize up,” according to an E&E News article on Feb. 18.

The bill would also actually ban indexed retail electric plans. In late February, the Public Utility Commission of Texas opened an investigation into the business practices of retail electric providers whose plans with pricing indexed to the electricity wholesale rate are reported to have inflicted unusually high bills on their Texas customers in the aftermath of the winter storm grid event.

As far as funding goes, SB 3 did not address any mechanism for that. However, the House has other pieces in the works that proposed funding, as retrofitting infrastructure would be expensive, “but not impossible, depending on the types of upgrades eventually mandated by regulators,” the Texas Tribune reported.

Senate Bill 3 would create a statewide emergency alert system in the event of future blackouts. It would  also create the Texas Energy Reliability Council, modeled after a currently voluntary board by the same name. Known as TERC, the board coordinates state energy regulators, electricity generators and the natural gas fuel industry to ensure reliable gas distribution for electricity.

The Tribune also reported that another key provision of the bill would shift some of the financial burden of ancillary services, which help ensure the continuous generation of power to the electricity grid in the ERCOT market, to renewable energy providers, an amendment proposed by state Sen. Kelly Hancock, R-North Richland Hills.

Several investigations have been launched and are ongoing. However, the Texas legislature seems intent on moving ahead sooner than later in hopes of avoiding this same situation ever again.

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