Bill Peacock, the policy director for the Energy Alliance, is criticizing the Texas Senate’s power grid reform plan for falling short on proper action needed to ensure the state has reliable energy.
“Rather than give more money to Texas' thermal generators, the way to increase the reliability and affordability of the Texas grid is to shut off the subsidies for renewable generators,” Peacock told Lone Star Standard. “Unfortunately, the Senate plan leaves Texas renewable subsidies firmly in place.”
Peacock’s concerns come as Lt. Gov. Dan Patrick (R-TX) and Texas Sen. Charles Schwertner (R-Georgetown) issued a joint statement on March 9 announcing their support for Senate Bills 6 and 7, which are intended to make sure Texas’ grid is stronger and attract new sources of reliable thermal electricity generation. Patrick named both bills to his top 10 list of priority legislation for this session.
Peacock told Lone Star Standard that both pieces of legislation “double down on the government intervention that, over the last decade, has undermined both competition and reliability in the Texas electricity market.”
Peacock pointed to research recently published by the Energy Alliance, which reported that, since 2007, wind and solar generators collected roughly $88 billion in investments with one-third coming from local, state or federal subsidies. In that same time frame, renewables grew their share of the Texas energy market from 3% to 31%. The research project predicts the figure will grow to 37% by the end of 2023.
The Energy Alliance's research concluded by listing a number of recommendations to improve the reliability and price of electricity in Texas, one of which was to combat renewable energy subsidies head-on to fix "price distortions" caused by those tax incentives.
In testimony before the Texas Senate Business and Commerce committee, Brent Bennett -- policy director of the Texas Public Policy Foundation's Life: Powered project -- pointed out the need for Texas to bring a balance to its energy market due to "overinvestment" in renewable sources of generation. Bennett advocated for an alteration to the Public Utility Commission's plan by changing where the money comes from to pay for the cost of improved reliability.
He suggested that the costs be allocated to electricity generators on a "cost causation basis," meaning generators whose unreliable nature results in volatile electricity prices would be responsible for the cost they impose on the market. Schwertner appeared to agree with Bennett's suggestion, saying, "It sounds logical. If you have a problem that is caused by 'X,' then 'X' should pay for the problem.”
