A Wall Street and big tech alliance warns the Texas government against imposing new costs on renewable power plants as the blame game over the state’s winter blackouts intensifies.
Companies ranging from Goldman Sachs and JPMorgan Chase to Amazon and Google, to Warren Buffett’s Berkshire Hathaway Energy, are trying to avoid new legislation they say will upend the economics of wind and solar power in the world. State.
The Texas House of Representatives was scheduled to discuss a bill on Thursday that would require wind and solar power plants to pay for essential grid services to keep the balance between supply and demand.
Lawmakers debated ways to prevent a repeat of February’s power outages, when cold arctic days took nearly half of Texas’ power capacity offline.
The cost of these so-called auxiliary services – which keep the frequency and voltage stable regardless of the conditions of supply and demand – is currently borne by electricity consumers and not by generators. They totaled $ 275 million last year, but jumped to $ 7 billion during the February crisis.
The bills “inappropriately and unfairly shift the cost” of ancillary services to solar and wind power, the companies said in a letter to Texas Gov. Greg Abbott.
“Such changes would undermine previous investment decisions and undermine confidence that the state will continue to provide the financial stability necessary for future energy investments.”
The signatories of the letter are some of the largest investors and buyers of renewable energy.
“The problem, and this is reflected in the letter, is that this is some sort of effort to penalize renewable resources on the basis of a widely discredited assumption that they were disproportionately responsible for power outages, ”said Gregory Wetstone, chief executive officer of the American Council. on renewable energy, an industry group that organized the letter.
Passage of the bill would mark a victory for those seeking to divert the field from renewables. Texas is one of several states where Republican-controlled legislatures have introduced bills that add costs for renewables or support the use of fossil fuels.
These measures run counter to President Joe Biden’s efforts to speed up construction of renewable projects with the aim of removing carbon emissions from the electricity sector by 2035.
As well as being the oil and gas production capital of the United States, Texas is also by far the leader in wind power generation and added more wind and solar capacity than any other last year. another US state, according to the Energy Information Administration.
In March, solar and wind combined accounted for 42% of generation on the Texas grid, ahead of natural gas and other types of power plants, said the Institute for Energy Economics and the ‘financial analysis.
The bills under discussion would attribute ancillary service costs to solar and wind generators to the extent that their operations caused “reliability issues,” according to the text of the bills sponsored by Rep.Phil King and Sen. Kelly Hancock, both Republicans.
Similar language, introduced by Hancock, was included in a sweeping electricity reform bill that was passed by the Texas Senate last week.
Jason Isaac of the Texas Public Policy Foundation, a conservative think tank, said the bills were needed to boost the construction of thermal power plants such as natural gas turbines, as opposed to intermittent resources such as power. solar and wind. “You have these variable sources that oscillate so wildly that it’s hard to predict what ancillary services you’re going to need and when,” he said.
February’s problems were prevalent in virtually all types of generators, including natural gas plants that suffered from low fuel pressure and wind turbines with blades covered in ice, said the Electric Reliability Council of Texas. (Ercot) in a preliminary report this week.
