2/15/2011 12:06 PM
The Senate Committee on Natural Resources and the Senate Committee on Business and Commerce jointly convened this morning for a (mostly) friendly chat with leaders of some major state agencies on what the blazes happened February 2 that led to the rolling blackouts leaving many Texans in the cold.
The committees have recessed for the morning but will reconvene after the Senate floor session adjourns.
Big names on the docket this morning included Chairman Barry Smitherman of the Public Utility Commission, Railroad Commissioner Michael Williams, Texas Commission on Environmental Quality Chairman Bryan Shaw, Electric Reliability Council of Texas President and CEO Trip Doggett, and Office of Public Utility Council Public Counsel Sheri Givens.
Here are some quick highlights.
The underlying problem was “lack of electric generation,” Natural Resources Chairman Troy Fraser (R-Horseshoe Bay) said at the start of the hearing. Between midnight and 1 p.m. on February 2, some 82 electric generation units (out of 550 – or about one out of eight) either tripped offline or were unable to come online, Doggett told lawmakers. (A power plant typically has multiple generation units.) Fraser called that “unacceptable.”
Smitherman observed ERCOT was not the only part of the state to experience problems. El Paso Electric, a regulated entity, also had problems, he said, as well as others municipally owned utilities and co-ops. Additionally, Smitherman said, Arizona experienced similar problems for similar inclement weather reasons.
Williams said that the blackouts were not a “natural gas event,” but Fraser seemed incredulous to that talking to reporters afterward. Fraser expressed concerns about natural gas suppliers not being required by contract to keep their supplies open, as well as the specter of some natural gas supplies being pumped out of Texas even as the state cannot meet its own energy obligations. He said he needed to know which plants have “interruptible gas contracts.”
Williams said that ample resources exist to establish a backup natural gas supply, as Fraser suggested. The question, Williams said, was simply whether the Railroad Commission has the jurisdiction to require natural gas suppliers to do so. Fraser said he could look into that question.
Smitherman pointed to several parts of the state that seemed to experience natural-gas-related issues, including a supplier in South Texas, another plant with a scheduled outage, and another supplier in North Texas.
Smitherman said that the communications process between PUC and ERCOT needs to be automated in the wake of the events. He also said the relationship between natural gas suppliers and generators needs to be clarified. He also called for clarification of the rule that requires each generation and poles company to adopt an “emergency operation plan.” When the rule was first written in 1999, that emergency operation plan was understood to apply to hurricanes. Smitherman and lawmakers agreed a plan needs to be in place to deal with peak demand in extreme cold weather like that experienced on Groundhog Day. Asked by Carona if the PUC had all the authority it needs to make such changes, Smitherman said yes. But again, Fraser seemed incredulous, telling reporters afterward that the PUC may need some more guidance from the legislature this session. He said such guidance would likely come in a stand-alone bill rather than hitching a ride on the PUC sunset bill.
Smitherman said that the PUC’s independent market monitor Dan Jones is now investigating the possibility of market manipulation, but Fraser said initial reports indicate there was none. He told reporters afterward that the opposite may have happened – i.e. reports seem to show some electric providers may have lost tens of millions as a result of the rolling blackouts.
Lawmakers are very interested in seeing the circumstances around which electric generators went off or stayed off. But with deregulation the records documenting which generators went off and why are generally not open records. A list of ERCOT providers who waived their privacy and whose data had been verified was provided to the committee.
Doggett did tell the committees, however, that he ordered the providers to stay online through the night the following evening. At 10 p.m. February 1, he reported, the state had some 60,000 megawatts online. If that much had been maintained on the grid, the rolling blackouts would not have been necessary. All 82 units were hit by 5:43 a.m. on February 2, when the rolling blackouts began, Smitherman said.
Fraser commended Shaw for ensuring electric providers that they would not have to worry about enforcement action should they exceed their permitted allowable emissions, given the emergency situation.