Uncategorized

Proposal floated to end Texas grid isolation and import power

28 March 2007 — The Dallas Morning News reported that Rep. Joe Barton has raised the prospect of ending Texas’ status as an independent grid. The state has its own electricity grid and is largely free from federal oversight.

TXU Corp.’s decision last month to cancel plans for eight of 11 new coal-fired power plants caused worry that the state might not have enough new generation capacity. Connecting the Texas grid with neighboring regions, the newspaper quoted Barton as saying, might allow power to be delivered from plants outside of the state and help push wholesale power prices down.

Interconnection suggestions have been made in the past, but the state’s utilities have generally preferred dealing with state regulators. What’s more, a powerful Texas congressional delegation has helped to discourage any change coming from Washington.

Barton is the ranking Republican on the House Energy and Commerce Committee and reportedly said in a letter to the Texas PUC that the Electric Reliability Council of Texas can be made subject to FERC regulation with “a few small changes in federal law.”

Sen. Kay Bailey Hutchison, R-Texas, reportedly said she’s open to hearing arguments for opening the grid but preferred to maintain the existing arrangement.

“A lower-cost producer outside … could cause generators inside to be more efficient,” Michelle Michot Foss, head of the University of Texas’ Center for Energy Economics, was quoted as saying. “It would make the market that much more competitive.”

Texas has limited interconnections outside of the state. These are a 220 MW transmission line connection near the Oklahoma border, a 600 MW connection in East Texas and a 36 MW connection with Mexico at Eagle Pass. Two additional transmission connections totaling 250 MW are under construction near Laredo and McAllen.