Texas electricity reforms to take time: Attorney

New laws in Texas aimed at shoring up electricity reliability in the aftermath of February's widespread outages might not ensure uninterrupted electricity flow this winter season, an energy and environmental attorney warned.

"The reality is that not all the legislation regarding coordination of the critical gas and electric infrastructure will be implemented before this winter," said Michael Nasi, an energy and environmental lawyer with the Jackson Walker law firm.

The outlook for this winter in terms of reliable power generation capacity looks "increasingly dicey" for Texas, Nasi told participants at the National Coal Transportation Association conference in Scottsdale, Arizona, on 22 September.

Nasi said "it is critically important" for state commissions to devise uniform criteria for transmission and distribution operators to use to prioritize what to protect during emergencies. "That is the hard work we need to coordinate among interrelated industries and both commissions and get done right now," he said.

The cold snap in February that knocked out power to most of Texas for a number of days has put greater scrutiny on power markets and prompted new laws and rules in the state. The Public Utility Commission (PUC) of Texas on 25 August proposed new weatherization requirements including required inspections and infrastructure upgrades. And the North American Electric Reliability Corporation on 23 September issued initial recommendations and findings on the cold snap. NERC is working to finalize its recommendations by November, after which it could draft mandatory reliability standards that would go to FERC for approval.

The PUC of Texas is expected to finalize its rules later this year.

The commission has proposed a two-phase process. The first phase includes creating a list of the entities within the natural gas supply chain that are willing to weatherize so they can clear the first threshold for being considered a part of a critical infrastructure. As part of this stage, generators and transmission operators will have to ensure by 1 December that all "cold weather critical components" will be able to function during extreme weather events and file a report with the PUC and the Electric Reliability Council of Texas (ERCOT) on winter weather readiness.

ERCOT will then have until 10 December to create a checklist detailing the compliance status for regulated entities and file a summary of the winter readiness reports it received from generators and transmission operators.

Regulators also will create a map of the critical supply chain working back from the power plants to the well heads and distinguish between and among the supply chain based on the flow pressure and economics, among other factors, Nasi said. ERCOT and the PUC by September 2022 will agree on criteria for establishing priorities that load-serving entities can use during periods of emergency to ensure that critical gas supply is protected, and that non-essential components of the gas production and supply chain are not prioritized.

The PUC will propose a second phase of rules for year-round reliability in the "future" it said in August.

But "just getting the industries to agree to weatherize critical chain facilities is not enough," to ensure reliability this coming winter, Nasi said. "Giving the transmission and distribution entities who have to shed the load the guidance about how to prioritize among critical needs is the missing element" and the deadlines for ERCOT and the PUC to issue those priorities is next year, he said.

"The entities on both sides of the fuel and power situation understand that it is in their best interests to come into compliance with the critical load designations and preparations for foul weather," PUC external affairs director Andrew Barlow said. "The PUC and ERCOT have been working aggressively to deliver on our shared legislative mandate, taking a more aggressive approach to grid management and working diligently to completely redesign the energy marketplace to deliver the reliability Texans deserve."

Barlow said the commission is also working closely with the Railroad Commission and the Texas Division of Emergency Management to deliver on mandates in a bill signed into law by Texas governor Greg Abbott in June aimed at securing grid reliability, by mapping critical infrastructure and working to improve communications between generators and their fuel sources to limit the types of disconnects that occurred during February's winter storm.

By Elena Vasilyeva