(Austin TX) December 5, 2022 – For Immediate Release
TCPA members* today, through the testimony of their executive director Michele Richmond, committed to bringing more than 4,500 megawatts of new gas generation to the ERCOT market if PCM is adopted under the right framework. “Investors and lenders need policy certainty – both regulatory certainty and legislative certainty. The PCM, if adopted by the PUC and supported by the Legislature, will provide that policy certainty – then investors can make their bets and take on the financial risk,” Richmond said before the House State Affairs Committee. Further, “Alternative suggestions, like procuring more traditional ancillary services or state-sponsored generation, cannot achieve this. TCPA members stand ready to bring more than 4,500 MW of new dispatchable generation online under the right framework.”
The current market design does not support the investment in reliability ERCOT needs. “ERCOT’s market uncertainty makes new gas generation unlikely without the PCM. Texans rely on these generators, and Texas consumers have made it clear uncertainty is no longer tolerable.” Concepts like an uncertainty product, more ancillary services, low-cost loans or state-subsidized generation will not result in the new investment that the PCM will. They, unlike the PCM, will perpetuate the uncertainty model in which Texans risk power outages – and that is unacceptable to everyone.
TCPA and its members support the PCM proposal and look forward to working with the PUC, ERCOT, and the Legislature to ensure its successful implementation. TCPA encourages the Legislature to signal its support for this market stability to ensure new generation can be brought into service as soon as possible.
- PCM sets a reliability standard – something every other market has and needs – in order to signal to investors what resources that market wants
- It specifically pays generators that have an on/off switch when they perform when we need them most during low renewable periods and high electricity demand
- It holds those generators accountable for providing the service they have told us they will provide
- It provides not only stable revenue on which investors and lenders can finance new investment, but it provides a stable cost expectation for consumers to budget
PCM DOES NOT:
- It does not pay for generation if it is not needed
- It does not pay generators to exist or pay for an entire fleet over and over
- It does not put significant profits in the pockets of industrial consumers and manufacturers at the expense of Texas residential and small business consumers
- It does not ask taxpayers or consumers to put their money at risk to build the much-needed gas plants or to keep the ones we rely on right now running until new more reliable ones are put into service.
TCPA is comprised of companies that are primarily competitive generators and are publicly-traded, privately held and private equity funded entities. TCPA members own approximately half of the power generation capacity in the ERCOT fleet and 82% of the natural gas-fueled power generation in ERCOT.
*TCPA member Shell does not support the PCM.