WEBVTT
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(gavel banging)
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This meeting of the Public Utility Commission of Texas
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will come to order to consider matters
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that have been duly posted
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with the Secretary of State of Texas
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for June 17th, 2021.
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For the record, my name is Peter Lake.
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With me today is Will McAdams.
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Present.
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This time, we'll open for public comment,
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invited oral testimony related to a specific agenda item
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will be heard when that item is taken up.
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This public comment segment is for general comments.
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Speakers will be limited to four minutes each.
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Will the operator please come on,
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and provide instructions to the public
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on how they may be recognized, if they wish to speak.
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Ladies and gentlemen,
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if you wish to make a comment,
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please press one, then zero on your telephone keypad.
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(water pouring)
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And it'll be a moment for the first comment.
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And first, we're going to the line of Brad Johnson.
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Please, go ahead.
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Hi, I'm responsible for facilities
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at NexTier Oilfield Solutions.
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And we have numerous locations across Texas
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and receive our utilities through Reliant NRG.
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Since late March, we've received approximately 27 invoices
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with over $300,000 in egregious past due
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charges from Reliant.
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This is over four times our normal utility bill.
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I've called and emailed Reliant for months
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with virtually no response.
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The two responses I have received were stating,
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my email has been received, escalated,
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and an account executive would be responding
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within 72 hours,
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yet, still no response.
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I've been asking for details
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supporting the $300,000 plus in past due fees,
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as well as disputing.
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But again, no responses have been provided.
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My concern is with the monitorium to shut off power
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for unpaid bills being lifted,
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many companies and individuals
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could have their power shut off
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without ever receiving a phone call
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or email addressing the many requests that had been made.
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I'm requesting, one, someone from Reliant to respond,
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either by phone call or email.
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And number two, for the monitorium to continue
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for any customers that have disputes
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with the February storms invoicing
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resulting in past due costs from March forward.
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These need to be addressed.
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Thank you very much.
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Thank you, Mr. Johnson.
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Thank you.
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And next, we go on to the line of Anthony Martell.
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Thank you for allowing me some time today.
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I have a similar situation.
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I have a small business
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and just a couple of people, myself,
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and a couple of others.
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And we had a bill that's typically
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around a thousand, maybe $1,500 per month.
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We received a bill from MidAmerican Energy
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for over $15,000, equivalent to almost an entire year
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of electricity costs for us in one particular month.
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And we have a fixed rate.
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We don't have a variable rate of any kind.
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And MidAmerican Energy is telling us
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that these are ancillary costs,
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and that we have to pay them.
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And to give a little more clarity
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of what we're facing right now,
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we have more than one meter at our location.
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And one of our meters,
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they're charging us $4.09 average cost.
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Our contract is four and a half cents.
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It's almost 100 times,
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100 times more than our fixed rate contract.
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And I'm not a lawyer
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and I don't pretend to be one.
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But I don't understand how this, you know,
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can pass any type of litmus test for truth in advertising.
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I don't know how this isn't just complete
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deceptive trade practices.
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It's supposed to be a fixed rate.
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And I'm just wondering
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from the Public Utility Commission standpoint,
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when a company advertises as fixed rate,
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but then they can pass through literally,
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almost a 100 fold increase in price
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that the Public Utility Commission can stand by
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and say, "MidAmerican, that's fine.
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"You guys can just keep doing what you're doing."
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Someone has gotta stop this.
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And I'm just a little guy,
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but if I don't speak out,
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I don't know that we're being heard.
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I know there's others.
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One person that just spoke before me,
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which is great,
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but we need help.
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I've reached out to our senator.
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I've reached out to the Governor's office.
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And now I'm reaching out to both of you
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at the Public Utility Commission.
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And hoping and praying that we're being heard
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and that something's gonna be done
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because we can't afford this.
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We barely made it through the pandemic last year
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in the beginning of this year.
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Now, we're being hit with these fees.
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And I have talked with other people at other businesses,
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and either they received no increase
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in their bill or a slight increase,
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but they didn't get a hundred fold increase.
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And also, one other quick comment,
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it's targeted only,
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it seems, at businesses,
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from what I've heard, at least.
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Residences, in many cases, maybe not all,
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are being spared.
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And if this type of fee had to be assessed,
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if everyone paid something,
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instead of putting these owner's fees
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on businesses where they're paying, you know,
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10 or 15 times or more their normal monthly bill,
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maybe we could get through this
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or maybe the PUC could step up
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and offer some assistance and some protection
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for consumers and small businesses like myself.
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You have one minute.
I hope we're being heard,
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and I hope there's some help
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that can be given before power's turned off.
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And we're just kind of in a no man's land,
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so to speak right now.
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Thank you for time.
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Thank you, sir.
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Thank you.
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And next, we go on to the line of Tammy Killian.
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Please go ahead.
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Good morning.
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Thank you for listening to my comments this morning.
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My husband and I are restaurant tours.
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And so you all know,
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everybody heard on the national news.
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You know what we went through
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with the pandemic.
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God blesses, we have survived.
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And we are fighting to continue
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to save two historic restaurants.
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One restaurant, over 70 years in business.
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We are your average citizens.
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When we signed up for our energy services,
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it's nearly like trying to be an expert
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just to figure out all the plans,
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what is right.
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We thought we were doing, you know,
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making a good business decision
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with our businesses.
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We're on a fixed rate.
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We had the opportunity to
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add our residential businesses or properties
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to our business plan recently.
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And so we thought, well, that sounds like a good idea.
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So, reasonable savings.
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So we were in limbo.
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March 1st was the date for our properties
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to go to fixed rate.
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And of course, the storm took place before that.
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So my 2,400 square foot home,
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the month after the Texas storm was a $200 electricity bill.
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I received a bill for over $21,000.
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We live on three acres.
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We have a barn and a shop in the back
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with a separate meter,
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charged at a commercial rate,
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which I know all the electricity companies
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pretty much do.
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That bill alone, which is normally under $100,
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around a $100,
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was over a $3,200 bill.
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And I guess, what I would like you to know most of all is
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that, you know, I'm kind of,
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try to be a little connected.
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So literally, like a lot of other businesses,
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I reached out to, you know, Tom Craddick, Hill Seliger,
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PUC originally, which,
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I sent all my invoices to
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and unbeknownst to us
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with this electricity contract when we signed up,
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apparently, we signed away our right
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for customer protection rules,
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which we had no clue what that meant,
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when we signed up.
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So again, there was nothing that could be done.
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So with the comments about reaching out
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to all of these individuals,
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we reached out to our TV stations, like,
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okay, you know what,
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you know, we couldn't believe it.
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This, oh, this can't be true.
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Surely, our state will take care of us.
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This is just wrong.
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But nobody could tell us what to do.
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And just recently,
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like a week or a week and a half ago,
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I found out about OPUC
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and found out about these meetings
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where I could, you know, at least comment
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and share what's going on.
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So my number one biggest concern
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that I would like you all to hear is
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I believe that there are a lot more people out there
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in this predicament,
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but nobody knows how to get to you to let you know.
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Nobody could tell us,
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"Hey, this is, call these people, go here."
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I guess, by the time I found out there was,
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you had mentioned about being helped earlier
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on other calls.
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But I think that more needs to be done.
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So the public really knows how to get their voices heard
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or their voices before you all
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for you to be able to make good informed decisions.
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Now, I do want you to know
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that our electricity provider is through ENGIE.
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I have already received-
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You have one minute.
Disconnect notices.
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Over time,
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they basically have already given us a moratorium
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that if you don't do this by this, by this day,
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they wanted 50% of the fee upfront
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with three additional payments,
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which is very hard to do,
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especially as recovering.
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So when I reached out to them and let them know
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that I knew that the moratorium
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was not off yet for disconnect
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and that I was struggling with the fact
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that they were giving us such short time to pay back,
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we were told that we need to provide
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all of our bank statements so they could decide
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whether they could give us a cash discount
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or give us any other plans,
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which is crazy.
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Then we did receive
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now some other options-
(bell chiming)
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Which allow it to be paid over 12 months.
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But I just want you to know,
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it's a tough situation.
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And there were a lot more people out there
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than y'all realize.
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Thank you for your time.
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Thank you, ma'am.
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Thank you.
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And as a reminder for public comments,
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please enter one, zero.
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Next, we're going to the line of Phyllis Davis.
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Please go ahead.
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Thank you very much.
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We have an apartment, large property.
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Apartment property, two houses, low income,
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elderly and disabled, or critical care.
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My electric provider is ENGIE.
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The first indication I received was a disconnect letter
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that I just knew was a mistake.
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That was on May the 27th.
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May 28th, I was on the phone with ENGIE, first thing.
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And I learned about this storm recovery fee.
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They were requiring me to pay 100%
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in order to not disconnect that service.
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I can't tell you the stress
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I was under in knowing that.
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And I told him, G. Ralph,
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you know, I said,
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"We have $12,000 in the bank.
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"And there's no way I can pay this,
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"but I can't afford for electricity
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"to go out on this,
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"you know, elderly and disabled folks.
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"What can I do?"
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Since that time, I've contacted you
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and many other agencies just kind of in a panic
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on what I can do.
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I then had another conversation with Angie,
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and they are unable to explain.
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They kept saying I was delinquent.
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The bill I paid, our invoice,
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I paid current charges to have a zero balance.
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And I told them I'm a good safe customer of yours for years.
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And I am getting the $107,000 and 78,
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$107,078 is my fee they have charged.
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And they said I was delinquent.
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The reason I've showed delinquent is ENGIE went back,
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and redid a past invoice
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for that January the 13th through February the 12th invoice
00:15:04.320 --> 00:15:06.140
that when I paid it,
00:15:06.140 --> 00:15:10.290
it had a zero balance when I paid current charges.
00:15:10.290 --> 00:15:13.270
So they go back retroactively
00:15:13.270 --> 00:15:15.640
redoing that same invoice
00:15:15.640 --> 00:15:19.000
to show that I have an unpaid balance.
00:15:19.000 --> 00:15:22.420
I think that is ethically wrong.
00:15:22.420 --> 00:15:26.560
And so they're calling me a delinquent customer.
00:15:26.560 --> 00:15:28.340
The new cutoff I have,
00:15:28.340 --> 00:15:30.300
I spoke to them yesterday,
00:15:30.300 --> 00:15:32.760
is Monday the 21st.
00:15:32.760 --> 00:15:37.550
And you know, they want 50% minimum.
00:15:37.550 --> 00:15:42.200
And she did send me a payment plan yesterday afternoon.
00:15:42.200 --> 00:15:45.870
But if I don't pay the 50% down,
00:15:45.870 --> 00:15:48.190
which I have literally no money.
00:15:48.190 --> 00:15:50.010
We're a nonprofit, also.
00:15:50.010 --> 00:15:52.100
Please consider that.
00:15:52.100 --> 00:15:53.160
And...
00:15:54.750 --> 00:15:58.210
They start charging you admin fees.
00:15:58.210 --> 00:15:59.550
And I asked ENGIE,
00:15:59.550 --> 00:16:02.817
I said, "Could you tell me what is the storm fee?
00:16:02.817 --> 00:16:04.570
"And what is your late fee?"
00:16:04.570 --> 00:16:06.774
The ENGIE rep said,
00:16:06.774 --> 00:16:09.347
"90% of this total
00:16:09.347 --> 00:16:12.020
"is actual energy charges."
00:16:12.020 --> 00:16:16.010
So I said, "Okay, 10% is late fees."
00:16:16.010 --> 00:16:19.110
I would ask you to take those off
00:16:19.110 --> 00:16:20.760
because I'm not late.
00:16:20.760 --> 00:16:23.547
If you're gonna apply this storm recovery fee-
00:16:23.547 --> 00:16:24.493
[Man In White Jacket] You have one minute.
00:16:24.493 --> 00:16:27.800
An extreme financial hardship.
00:16:27.800 --> 00:16:30.090
Take off the fee.
00:16:30.090 --> 00:16:33.390
But I would like all of you to hear the hardships,
00:16:33.390 --> 00:16:36.460
real hardship we are getting
00:16:36.460 --> 00:16:37.440
over these
00:16:38.910 --> 00:16:40.900
very aggressive
00:16:43.090 --> 00:16:46.950
behaviors from ENGIE, in my case,
00:16:46.950 --> 00:16:50.170
and threatening on these disconnects
00:16:50.170 --> 00:16:54.520
where I have elderly, and disabled, low-income folks.
00:16:54.520 --> 00:16:57.120
And I appreciate the time,
00:16:57.120 --> 00:16:59.970
but it is just not right for ENGIE
00:16:59.970 --> 00:17:03.560
to go back and change past invoices,
00:17:03.560 --> 00:17:07.953
so it looks like I have a delinquent amount and,
00:17:09.110 --> 00:17:11.630
we do need someone to hear us
00:17:11.630 --> 00:17:14.730
and change something in the state of Texas.
00:17:14.730 --> 00:17:16.710
Thank you very much.
00:17:16.710 --> 00:17:17.660
Thank you, ma'am.
00:17:19.000 --> 00:17:19.947
Thank you.
00:17:19.947 --> 00:17:20.900
And once again, for public comments,
00:17:20.900 --> 00:17:22.780
please enter one, zero.
00:17:22.780 --> 00:17:25.170
Next, we're going to the line of Jaime Sloss.
00:17:25.170 --> 00:17:26.083
Please go ahead.
00:17:28.290 --> 00:17:29.820
So first off, I wanna apologize
00:17:29.820 --> 00:17:31.920
to all the people going through hardship,
00:17:31.920 --> 00:17:33.930
and I definitely wanna apologize to them
00:17:33.930 --> 00:17:35.980
for thinking that the PUC,
00:17:35.980 --> 00:17:38.480
and the Chairman, and Commissioner
00:17:38.480 --> 00:17:41.490
or that their titles care about the people.
00:17:41.490 --> 00:17:44.403
Because if you look at docket number 50284,
00:17:45.450 --> 00:17:50.300
I raised various concerns about the PUC process,
00:17:50.300 --> 00:17:52.850
and that you don't even follow your own process
00:17:52.850 --> 00:17:55.100
on the basic set of hearings.
00:17:55.100 --> 00:17:56.460
So any advice I can give
00:17:56.460 --> 00:17:58.870
to the public is get yourself a lawyer
00:17:58.870 --> 00:18:03.390
to make sure that your rights are not infringed upon
00:18:03.390 --> 00:18:05.830
or just all together thrown out
00:18:06.750 --> 00:18:10.523
because Chairman Walker, whatever his name is,
00:18:11.500 --> 00:18:14.893
McAdams and Peter Lake,
00:18:16.466 --> 00:18:18.802
they don't even follow their own rules at the PUC,
00:18:18.802 --> 00:18:20.130
so they really don't care.
00:18:20.130 --> 00:18:22.430
And if you're late and you're hoping
00:18:22.430 --> 00:18:24.923
to get help for the disconnect fee,
00:18:26.590 --> 00:18:30.300
look at the June 11th open meeting,
00:18:30.300 --> 00:18:32.930
and you're gonna see that
00:18:32.930 --> 00:18:35.077
McAdams laughed and says,
00:18:35.077 --> 00:18:37.600
"Oh, I'll be happy with whatever I can get",
00:18:37.600 --> 00:18:41.670
when they set a seven-day notice
00:18:41.670 --> 00:18:44.360
to the public before they get disconnected.
00:18:44.360 --> 00:18:46.700
So if you think these people care,
00:18:46.700 --> 00:18:48.140
I just want you guys to be on notice
00:18:48.140 --> 00:18:50.120
that they do not care,
00:18:50.120 --> 00:18:52.010
and your rights that you think you have,
00:18:52.010 --> 00:18:53.310
you do not have them.
00:18:53.310 --> 00:18:55.333
So I highly recommend you get a lawyer.
00:18:56.440 --> 00:18:58.410
Because I requested a rehearing
00:18:58.410 --> 00:18:59.540
because the witnesses
00:19:00.410 --> 00:19:02.560
for my electric utility were not present
00:19:02.560 --> 00:19:06.990
as it is stated in the basic steps of a hearing process,
00:19:06.990 --> 00:19:10.060
and they still voted against the rehearing,
00:19:10.060 --> 00:19:13.550
and they decided with whatever the electric utility said.
00:19:13.550 --> 00:19:15.220
And now I'm here five years later
00:19:15.220 --> 00:19:17.430
after fighting with these people,
00:19:17.430 --> 00:19:20.090
thinking that PUC is here for the people,
00:19:20.090 --> 00:19:22.160
but they're not here for the people.
00:19:22.160 --> 00:19:23.720
And McAdams knows it.
00:19:23.720 --> 00:19:25.003
And Peter Lake knows it.
00:19:25.890 --> 00:19:27.760
I would ask you guys to step down
00:19:27.760 --> 00:19:30.100
and have somebody that's capable of doing the job,
00:19:30.100 --> 00:19:32.470
and following the basic steps of the process,
00:19:32.470 --> 00:19:35.770
and understanding the basic steps
00:19:36.720 --> 00:19:38.790
to allow them to take over the PUC
00:19:39.750 --> 00:19:41.960
so that these people stop suffering
00:19:41.960 --> 00:19:44.920
because you guys cannot implement the rules.
00:19:44.920 --> 00:19:47.790
You don't understand the tariffs that are in place,
00:19:47.790 --> 00:19:49.740
and you do not care about the people,
00:19:49.740 --> 00:19:51.600
not the people of Texas.
00:19:51.600 --> 00:19:52.433
Thank you.
00:19:53.830 --> 00:19:54.980
Thank you, Mr. Sloss.
00:19:56.240 --> 00:19:57.073
Thank you.
00:19:57.073 --> 00:19:59.493
And there are no more public comments at this time.
00:20:01.890 --> 00:20:03.873
Public comment is now closed.
00:20:05.150 --> 00:20:06.933
Moving on to the regular agenda.
00:20:07.830 --> 00:20:09.830
Item number one, Will, I don't have anything on those.
00:20:09.830 --> 00:20:10.663
No, sir.
00:20:12.090 --> 00:20:13.410
Item number two,
00:20:13.410 --> 00:20:16.610
I believe staff has some clarifying questions.
00:20:16.610 --> 00:20:17.443
I do.
00:20:19.360 --> 00:20:21.063
At the last open meeting,
00:20:22.450 --> 00:20:23.880
you instructed
00:20:24.980 --> 00:20:26.910
or you decided
00:20:26.910 --> 00:20:29.420
that an order would be issued,
00:20:29.420 --> 00:20:32.880
lifting the disconnect moratorium effective tomorrow,
00:20:32.880 --> 00:20:34.440
June 18th.
00:20:34.440 --> 00:20:35.850
And in that discussion,
00:20:35.850 --> 00:20:38.990
we talked about the standard 10-day notice period
00:20:38.990 --> 00:20:41.450
for postpaid customers,
00:20:41.450 --> 00:20:43.710
meaning that
00:20:43.710 --> 00:20:47.660
no disconnections would take place before June 29th.
00:20:47.660 --> 00:20:50.720
And staff has received the question
00:20:50.720 --> 00:20:52.370
regarding prepaid customers
00:20:52.370 --> 00:20:54.840
who have a slightly different notice period.
00:20:54.840 --> 00:20:56.140
I wanted to clarify
00:20:56.140 --> 00:20:58.850
that it was your intent that no disconnections
00:20:58.850 --> 00:21:01.920
of any kind would take place before June 29th.
00:21:01.920 --> 00:21:04.350
That was my intent.
That's my intent.
00:21:04.350 --> 00:21:05.510
Thank you.
00:21:05.510 --> 00:21:06.343
Yes, ma'am.
00:21:08.081 --> 00:21:09.843
I don't have anything for number three, number three.
00:21:09.843 --> 00:21:10.763
Do you, Will?
00:21:13.270 --> 00:21:14.427
Backing up to that,
00:21:14.427 --> 00:21:16.340
just because of the preponderance
00:21:16.340 --> 00:21:18.203
of public comments on this,
00:21:20.270 --> 00:21:22.340
'cause I think
00:21:22.340 --> 00:21:24.250
it was such a massive
00:21:25.360 --> 00:21:26.740
event in February,
00:21:26.740 --> 00:21:28.970
and the financial impact
00:21:31.383 --> 00:21:33.350
to consumers is broad-based.
00:21:33.350 --> 00:21:37.140
And I mean, our arguments are compelling
00:21:37.140 --> 00:21:39.410
that are coming in made by consumers.
00:21:39.410 --> 00:21:40.450
I just wanna make sure.
00:21:40.450 --> 00:21:42.650
And we touched on it at the last open meeting,
00:21:42.650 --> 00:21:45.530
but I guess, we need to focus on it every time
00:21:45.530 --> 00:21:47.143
we have the ability to speak.
00:21:48.980 --> 00:21:50.313
In my view,
00:21:53.010 --> 00:21:55.310
if reps are holding themselves out
00:21:55.310 --> 00:21:57.680
or holding products out as fixed rate plans,
00:21:57.680 --> 00:22:01.590
I think it's very important to us to try to define
00:22:01.590 --> 00:22:04.850
or at least, look at what that means in the market,
00:22:04.850 --> 00:22:06.120
especially in light,
00:22:06.120 --> 00:22:09.160
I know we're gonna talk about House Bill 16
00:22:09.160 --> 00:22:11.453
and variable rate products.
00:22:12.580 --> 00:22:17.140
So for commercial consumers who've been calling in
00:22:17.140 --> 00:22:18.533
as well as residential,
00:22:19.710 --> 00:22:21.300
and again, I don't wanna overload
00:22:21.300 --> 00:22:23.490
the PUC's complaints switchboard.
00:22:23.490 --> 00:22:24.770
But that is the trigger
00:22:24.770 --> 00:22:28.870
for us to be able to drill down on the terms
00:22:28.870 --> 00:22:31.330
and conditions of contracts
00:22:31.330 --> 00:22:32.940
to at least analyze it.
00:22:32.940 --> 00:22:34.330
And I think it's in the public interest
00:22:34.330 --> 00:22:37.330
for the Commission to over time process those complaints,
00:22:37.330 --> 00:22:40.580
process those cases as they're coming through,
00:22:40.580 --> 00:22:43.500
so that we can establish a bit of case law on this,
00:22:43.500 --> 00:22:45.750
a bit of PUC precedent,
00:22:45.750 --> 00:22:46.870
because in future events,
00:22:46.870 --> 00:22:48.170
this is gonna be very important.
00:22:48.170 --> 00:22:51.660
One, we wanna help the people that are at need now.
00:22:51.660 --> 00:22:53.870
And two, we wanna establish safe guards,
00:22:53.870 --> 00:22:55.550
so that we just don't go through this again.
00:22:55.550 --> 00:22:58.960
And I would stress that a deregulated market does not mean
00:22:58.960 --> 00:23:00.393
that there's no regulations.
00:23:01.660 --> 00:23:05.310
This Commission exists to protect the consumer,
00:23:05.310 --> 00:23:09.680
and to protect a healthy market that benefits all Texans.
00:23:09.680 --> 00:23:11.530
So those are kind of my views on it.
00:23:11.530 --> 00:23:13.920
I just wanna stress for these people,
00:23:13.920 --> 00:23:16.080
these business people that called in,
00:23:16.080 --> 00:23:18.930
as well as the the consumers at large,
00:23:18.930 --> 00:23:21.170
stay in contact with the PUC,
00:23:21.170 --> 00:23:24.063
complain if you feel like you're being mistreated.
00:23:25.410 --> 00:23:29.790
Fixed rate needs to be established here at the Commission.
00:23:29.790 --> 00:23:33.430
And we need to define safeguards.
00:23:33.430 --> 00:23:36.010
Fixed rate should mean fixed rate.
00:23:36.010 --> 00:23:37.194
That's was my view.
00:23:37.194 --> 00:23:39.190
A hundred percent agree with that.
00:23:39.190 --> 00:23:40.990
And variable can be variable, right?
00:23:42.120 --> 00:23:43.550
And as we dig into that,
00:23:43.550 --> 00:23:44.650
and I absolutely,
00:23:44.650 --> 00:23:48.103
the first step is our customer production line,
00:23:49.420 --> 00:23:54.100
encourage people to use that when needed,
00:23:54.100 --> 00:23:57.013
and use it sooner rather than later.
00:23:58.630 --> 00:24:02.370
And also as part of the rulemaking,
00:24:02.370 --> 00:24:04.120
we'll be going through considering,
00:24:05.940 --> 00:24:09.450
not only ensuring that fixed rate is truly fixed
00:24:09.450 --> 00:24:12.230
without backdoor exemptions,
00:24:12.230 --> 00:24:15.520
but also ensure that we take a hard look
00:24:15.520 --> 00:24:17.960
at the fine print,
00:24:17.960 --> 00:24:21.450
and make sure that waiving rights,
00:24:21.450 --> 00:24:24.700
certain rights or other exemptions
00:24:24.700 --> 00:24:27.210
we make in customer contracts,
00:24:27.210 --> 00:24:30.070
let's make sure we take a very hard look at that,
00:24:30.070 --> 00:24:33.573
and clearly define what is inbounds and acceptable,
00:24:34.490 --> 00:24:36.270
so we can avoid these kinds problems going forward.
00:24:36.270 --> 00:24:37.790
Yeah, I'm all about that.
00:24:37.790 --> 00:24:41.653
If staff, and I know staff is out there taking note but,
00:24:43.420 --> 00:24:45.170
over the next months,
00:24:45.170 --> 00:24:47.290
I think it's important that we see a flow
00:24:47.290 --> 00:24:49.240
through when possible to get these
00:24:49.240 --> 00:24:50.100
before the Commission,
00:24:50.100 --> 00:24:51.450
so we can start speaking to this
00:24:51.450 --> 00:24:54.223
on a more specific basis.
00:24:55.342 --> 00:24:56.403
And again, that will,
00:24:57.720 --> 00:24:59.820
consumers, and matter of fact,
00:24:59.820 --> 00:25:03.423
can we have, just while we have this opportunity.
00:25:04.890 --> 00:25:07.380
This Commission has promulgated a clarification
00:25:07.380 --> 00:25:09.850
on what the rules and regulations are,
00:25:09.850 --> 00:25:14.850
but Connie can you speak to the mechanics of disconnection,
00:25:15.000 --> 00:25:17.460
the five billing cycle moratorium
00:25:17.460 --> 00:25:19.863
and what the consumers rights are.
00:25:21.410 --> 00:25:23.093
Absolutely, so.
00:25:24.490 --> 00:25:27.370
I'll go through the base case where the customer
00:25:29.940 --> 00:25:33.780
understands that they owe
00:25:33.780 --> 00:25:35.800
and they agree that they owe the amount
00:25:35.800 --> 00:25:38.360
that they need, perhaps, more time to pay.
00:25:38.360 --> 00:25:42.503
So they should call their retail electric provider and,
00:25:44.080 --> 00:25:49.080
our rules call for a maximum of 50% down payment,
00:25:49.920 --> 00:25:53.460
and then five subsequent payments
00:25:53.460 --> 00:25:56.240
to eliminate the balance,
00:25:56.240 --> 00:25:57.650
to pay that off.
00:25:57.650 --> 00:25:59.490
That is the minimum.
00:25:59.490 --> 00:26:02.720
The rep
00:26:02.720 --> 00:26:04.870
is absolutely welcome
00:26:04.870 --> 00:26:07.750
to provide any more lenient terms.
00:26:07.750 --> 00:26:09.110
If they wanted to give
00:26:10.560 --> 00:26:13.793
25% down payment in one year,
00:26:14.690 --> 00:26:17.880
that would be absolutely compliant with our rules.
00:26:17.880 --> 00:26:21.890
We had a number of retail electric providers
00:26:21.890 --> 00:26:24.310
file letters with the Commission,
00:26:24.310 --> 00:26:29.310
noting that they were providing these more flexible,
00:26:29.770 --> 00:26:31.433
deferred payment plans.
00:26:32.290 --> 00:26:36.280
And I believe, they're described in those letters.
00:26:36.280 --> 00:26:40.640
One point, they also made that is very important
00:26:40.640 --> 00:26:45.400
to remember is the customer should contact the provider,
00:26:45.400 --> 00:26:46.240
work with them,
00:26:46.240 --> 00:26:49.103
let them know what it is they can pay,
00:26:49.940 --> 00:26:52.170
and work out a payment plan
00:26:52.170 --> 00:26:55.723
that's specialized to whatever that customer's needs are.
00:26:57.230 --> 00:26:59.930
So that's for when
00:26:59.930 --> 00:27:03.110
you realize that your bill is correct,
00:27:03.110 --> 00:27:05.003
but you need more time to pay it.
00:27:06.440 --> 00:27:07.463
If you,
00:27:09.370 --> 00:27:12.150
again, agree that your bill is correct,
00:27:12.150 --> 00:27:16.090
but you just don't have the funds
00:27:16.950 --> 00:27:17.900
to pay the bill,
00:27:17.900 --> 00:27:20.880
even over a payment plan as described,
00:27:20.880 --> 00:27:24.950
you can take advantage of some of the TDAHC programs
00:27:24.950 --> 00:27:28.500
that were presented here a couple of weeks ago.
00:27:28.500 --> 00:27:31.280
There's a
00:27:31.280 --> 00:27:32.870
program specific to renters,
00:27:32.870 --> 00:27:34.340
and then there's a general program
00:27:34.340 --> 00:27:36.310
for both renters and owners.
00:27:36.310 --> 00:27:40.660
And folks can find more about that on the TDAH website.
00:27:40.660 --> 00:27:45.660
They can call into our customer protection division,
00:27:45.670 --> 00:27:49.270
and get some guidance on how to access those plans.
00:27:49.270 --> 00:27:51.700
And they can see through our website
00:27:51.700 --> 00:27:53.615
as well how to get access.
00:27:53.615 --> 00:27:55.873
And along those lines,
00:27:56.750 --> 00:27:58.840
I'm sure our communications team will continue
00:27:58.840 --> 00:28:01.420
to provide that information, those websites,
00:28:01.420 --> 00:28:02.970
those phone numbers
00:28:02.970 --> 00:28:05.810
via our multiple social media channels.
00:28:05.810 --> 00:28:06.790
Absolutely.
00:28:06.790 --> 00:28:09.490
And then to get closer to the scenario
00:28:09.490 --> 00:28:10.990
that many of the customers
00:28:10.990 --> 00:28:13.410
in the public comment period described today
00:28:13.410 --> 00:28:14.243
which was,
00:28:15.222 --> 00:28:18.520
they don't agree that they owe that bill.
00:28:18.520 --> 00:28:20.590
That's not what they signed up for,
00:28:20.590 --> 00:28:22.923
what they believed they were signing up for.
00:28:24.020 --> 00:28:25.850
And they don't think it's right.
00:28:25.850 --> 00:28:29.390
They should absolutely contact their provider,
00:28:29.390 --> 00:28:31.180
dispute the amount.
00:28:31.180 --> 00:28:34.870
If they cannot get proper resolution from that provider,
00:28:34.870 --> 00:28:38.260
then call our customer protection division
00:28:38.260 --> 00:28:41.160
or file a complaint online.
00:28:41.160 --> 00:28:43.350
And I want to be sure
00:28:43.350 --> 00:28:46.870
to get the exact rule citation correct,
00:28:46.870 --> 00:28:48.890
so I have it here.
00:28:48.890 --> 00:28:52.080
Commissions rule 25.485
00:28:54.010 --> 00:28:57.727
subsection E2, specifically says,
00:28:57.727 --> 00:29:00.380
"While an informal complaint process is pending",
00:29:00.380 --> 00:29:03.330
that means you've contacted customer protection,
00:29:03.330 --> 00:29:05.693
and they've begun investigating your complaint.
00:29:07.227 --> 00:29:10.557
"The rep shall not initiate collection activities,
00:29:10.557 --> 00:29:12.727
"including disconnection of service
00:29:12.727 --> 00:29:14.547
"or reporting the customer's delinquency
00:29:14.547 --> 00:29:16.367
"to a credit reporting agency
00:29:16.367 --> 00:29:19.840
"with respect to the disputed portion of the bill".
00:29:19.840 --> 00:29:23.770
So if you're concerned that you're in a dispute,
00:29:23.770 --> 00:29:25.880
and you're concerned you're gonna get disconnected
00:29:25.880 --> 00:29:26.823
because of it,
00:29:28.330 --> 00:29:31.550
make sure that you have a record of your dispute
00:29:31.550 --> 00:29:32.493
here at the PUC
00:29:33.530 --> 00:29:36.290
and you cannot be disconnected.
00:29:36.290 --> 00:29:37.390
That's incredibly important.
00:29:37.390 --> 00:29:38.710
So like you said,
00:29:38.710 --> 00:29:40.380
the first step is contacting
00:29:40.380 --> 00:29:42.410
the PUC customer protection line.
00:29:42.410 --> 00:29:43.243
That's correct.
00:29:43.243 --> 00:29:45.973
And once that complaint is initiated,
00:29:46.920 --> 00:29:49.840
you cannot disconnected.
00:29:49.840 --> 00:29:52.790
And once that is initiated,
00:29:52.790 --> 00:29:54.313
until it is resolved,
00:29:55.340 --> 00:29:57.240
that customer cannot be disconnected,
00:29:57.240 --> 00:30:00.080
they cannot be sent to a credit reporting agency,
00:30:00.080 --> 00:30:01.670
and they cannot be put in collections.
00:30:01.670 --> 00:30:02.740
Exactly.
00:30:02.740 --> 00:30:04.610
That is an incredibly important point.
00:30:04.610 --> 00:30:06.020
Thank you.
00:30:06.020 --> 00:30:06.853
Thanks.
00:30:06.853 --> 00:30:09.660
So that's the point I wanna make to the public,
00:30:09.660 --> 00:30:12.490
is on the policy,
00:30:12.490 --> 00:30:14.550
we at the Commission need an opportunity
00:30:14.550 --> 00:30:15.790
to start working this problem,
00:30:15.790 --> 00:30:17.430
and we are working the problem.
00:30:17.430 --> 00:30:19.950
But we're doing it on a massive basis
00:30:19.950 --> 00:30:24.420
to try to help as many consumers as possible
00:30:24.420 --> 00:30:26.480
with these decisions that we're making here.
00:30:26.480 --> 00:30:30.370
So as you call your providers,
00:30:30.370 --> 00:30:32.820
as you work through the negotiations
00:30:32.820 --> 00:30:33.690
on these payment plans,
00:30:33.690 --> 00:30:36.380
and then as you work through with the Commission,
00:30:36.380 --> 00:30:38.800
then that'll provide, that as the trigger to provide us
00:30:38.800 --> 00:30:40.610
with the opportunity to speak to this
00:30:40.610 --> 00:30:42.320
and long-term help you.
00:30:42.320 --> 00:30:45.150
So again,
00:30:45.150 --> 00:30:48.470
I know that we're a sleepy little agency
00:30:48.470 --> 00:30:49.980
up until the February event,
00:30:49.980 --> 00:30:53.970
but we are processing this quickly,
00:30:53.970 --> 00:30:57.100
and we wanna help as many people as possible,
00:30:57.100 --> 00:30:59.893
so just provide us that opportunity.
00:31:01.060 --> 00:31:02.444
Well, put.
00:31:02.444 --> 00:31:05.623
Thank you.
Thank you, Connie.
00:31:05.623 --> 00:31:06.720
Does that cover everything for?
00:31:06.720 --> 00:31:07.553
Yes, sir.
00:31:07.553 --> 00:31:08.569
That's all I have.
00:31:08.569 --> 00:31:10.669
Thank you for highlighting those points.
00:31:12.070 --> 00:31:14.140
Item three, I don't have anything on this.
00:31:14.140 --> 00:31:14.973
Do you?
00:31:14.973 --> 00:31:16.100
No, no, sir
00:31:17.700 --> 00:31:19.543
Item number four,
00:31:20.970 --> 00:31:22.950
review of wholesale index products
00:31:22.950 --> 00:31:25.710
for compliance and customer protection rules.
00:31:25.710 --> 00:31:29.433
I believe Mr. Smelser has a presentation for us.
00:31:43.200 --> 00:31:44.033
Good morning, Commissioners.
00:31:44.033 --> 00:31:45.843
David Smelser for Commission staff.
00:31:53.210 --> 00:31:57.203
So as Connie sort of discussed with you guys before,
00:31:58.450 --> 00:32:00.410
this started out as sort of a rule-making effort
00:32:00.410 --> 00:32:03.430
to specifically implement the prohibition
00:32:03.430 --> 00:32:06.120
on wholesale index pricing.
00:32:06.120 --> 00:32:07.410
We've expanded a little bit
00:32:07.410 --> 00:32:09.280
to include some other customer protection issues.
00:32:09.280 --> 00:32:11.660
But as we've seen with the discussion
00:32:11.660 --> 00:32:13.860
that you guys have been having the last few minutes,
00:32:13.860 --> 00:32:16.060
there might be, you know,
00:32:16.060 --> 00:32:18.080
there's more to do than just the contents
00:32:18.080 --> 00:32:19.410
that I'm gonna talk to you today.
00:32:19.410 --> 00:32:22.230
And so, you know, maybe that'll be a different rulemaking
00:32:22.230 --> 00:32:24.470
or maybe, we can add some briefing questions
00:32:24.470 --> 00:32:27.660
onto this to start calling industry for solutions.
00:32:27.660 --> 00:32:30.370
That's, you know, whatever your preference is on that.
00:32:30.370 --> 00:32:33.670
But I don't wanna just start pitching solutions
00:32:33.670 --> 00:32:34.970
without having thought them through,
00:32:34.970 --> 00:32:37.110
but I think we're definitely gonna be looking
00:32:37.110 --> 00:32:38.860
into the matters that we discussed.
00:32:39.910 --> 00:32:44.560
For today, the current status right now is
00:32:44.560 --> 00:32:47.780
we wanna try and get a proposal for publication,
00:32:47.780 --> 00:32:50.360
so we can get the rulemaking moving by July 15th.
00:32:50.360 --> 00:32:53.380
But in order to make sure we're putting out
00:32:53.380 --> 00:32:54.250
the best product possible,
00:32:54.250 --> 00:32:55.860
we're gonna run a straw man out there first
00:32:55.860 --> 00:32:57.180
or at least, that's the plan.
00:32:57.180 --> 00:32:59.140
And so today, I just wanted to make sure
00:32:59.140 --> 00:33:00.930
that you guys thought we were moving in the right direction
00:33:00.930 --> 00:33:03.250
because we have, you know, a lot of this,
00:33:03.250 --> 00:33:05.750
the legislature told us how they wanted us to do it,
00:33:05.750 --> 00:33:08.030
but we've made a few sort of policy calls ourselves.
00:33:08.030 --> 00:33:10.050
So I just wanted to talk you through those calls
00:33:10.050 --> 00:33:10.883
and you guys can say,
00:33:10.883 --> 00:33:13.317
"Yeah, this is kind of what we thought or not."
00:33:14.310 --> 00:33:17.610
The two bills that we're implementing here,
00:33:17.610 --> 00:33:19.960
the first one is a House Bill 16
00:33:19.960 --> 00:33:21.943
and this has a couple of components.
00:33:22.960 --> 00:33:24.810
As we discussed, specifically,
00:33:24.810 --> 00:33:26.740
with regard to the wholesale index products,
00:33:26.740 --> 00:33:29.170
which are those that vary in real time with energy,
00:33:29.170 --> 00:33:30.680
the sort of gritty products,
00:33:30.680 --> 00:33:32.763
is the ones that we're more familiar with.
00:33:33.790 --> 00:33:34.730
According to the bill,
00:33:34.730 --> 00:33:36.290
they're gonna be prohibited for residential
00:33:36.290 --> 00:33:37.780
and small commercial customers.
00:33:37.780 --> 00:33:39.563
And for those larger customers,
00:33:40.860 --> 00:33:41.700
they will be permitted,
00:33:41.700 --> 00:33:42.533
but there has to be,
00:33:42.533 --> 00:33:44.630
there's a specific statement in the law
00:33:44.630 --> 00:33:46.510
that's an acknowledgement of risk
00:33:46.510 --> 00:33:48.890
that basically makes it so that we're sure
00:33:48.890 --> 00:33:50.680
that when people sign up for these plans,
00:33:50.680 --> 00:33:53.890
they understand that they can vary pretty widely.
00:33:53.890 --> 00:33:54.723
And so, of course,
00:33:54.723 --> 00:33:56.330
that is, we have the strong main language
00:33:56.330 --> 00:33:58.350
that will implement it as described,
00:33:58.350 --> 00:33:59.710
but there are a few expansions
00:33:59.710 --> 00:34:01.753
that we were thinking about making on that.
00:34:03.035 --> 00:34:04.290
At this point, since it's straw man
00:34:04.290 --> 00:34:06.320
we sort of, we're putting them out there for comments
00:34:06.320 --> 00:34:07.190
and we'll see what people think.
00:34:07.190 --> 00:34:08.940
Maybe they should be stronger, not stronger,
00:34:08.940 --> 00:34:11.730
but one expansion we wanted to do is, you know,
00:34:11.730 --> 00:34:13.600
I mean the realtime price of energy
00:34:13.600 --> 00:34:16.450
is not the only thing that you can be indexed
00:34:16.450 --> 00:34:17.780
to that could vary widely.
00:34:17.780 --> 00:34:20.380
And so we were thinking about requiring
00:34:20.380 --> 00:34:23.660
a similar statement of risk for any index product,
00:34:23.660 --> 00:34:24.580
just so that when people,
00:34:24.580 --> 00:34:25.870
if people were indexing to things
00:34:25.870 --> 00:34:27.050
that could be varying widely,
00:34:27.050 --> 00:34:30.290
they need to, you know, deliberately make that choice.
00:34:30.290 --> 00:34:32.212
What would an example of that?
00:34:32.212 --> 00:34:34.860
For instance, you could be indexed to the NYMEX
00:34:34.860 --> 00:34:36.567
or ancillary services, or, you know,
00:34:36.567 --> 00:34:38.080
I mean you can index to anything,
00:34:38.080 --> 00:34:40.040
but I guess NYMEX is your clearest example
00:34:40.040 --> 00:34:41.150
of something that goes up and down
00:34:41.150 --> 00:34:42.770
that plants can be-
00:34:42.770 --> 00:34:46.980
Sure, any variable financial product out there.
00:34:46.980 --> 00:34:47.813
Right.
00:34:47.813 --> 00:34:49.870
But on ancillary service, since so many, I mean,
00:34:49.870 --> 00:34:52.047
since that's what we're hearing on the commercial side,
00:34:52.047 --> 00:34:56.330
where this would probably be more of a attractive target,
00:34:56.330 --> 00:34:57.990
I mean, individual consumers certainly
00:34:57.990 --> 00:34:59.790
could avail themselves but for a business, you know,
00:34:59.790 --> 00:35:02.450
who's looking to squeeze everything they can
00:35:02.450 --> 00:35:03.790
out of a product,
00:35:03.790 --> 00:35:06.000
that would be something to consider.
00:35:06.000 --> 00:35:06.833
I agree.
00:35:06.833 --> 00:35:09.040
And I think that with ancillary services in particular,
00:35:09.040 --> 00:35:10.820
that was the second proposal that we talked about
00:35:10.820 --> 00:35:12.310
is to pull together.
00:35:12.310 --> 00:35:13.190
It wouldn't be, you know,
00:35:13.190 --> 00:35:15.110
these other ones wouldn't be written the same way,
00:35:15.110 --> 00:35:17.950
but we have a version written out
00:35:17.950 --> 00:35:19.590
that would require acknowledgement of risk
00:35:19.590 --> 00:35:22.660
for anything that included an ancillary service pass through
00:35:22.660 --> 00:35:24.260
which is a little bit different than indexing
00:35:24.260 --> 00:35:25.093
but it creates the same,
00:35:25.093 --> 00:35:27.380
from the customer's perspective, it's the same problem.
00:35:27.380 --> 00:35:30.830
A lot of money that I wasn't expecting to have to pay.
00:35:30.830 --> 00:35:33.110
And then one element that it's, you know,
00:35:33.110 --> 00:35:36.230
it's not clear from the legislation
00:35:36.230 --> 00:35:38.740
what the legislative intent would have been
00:35:38.740 --> 00:35:40.140
behind polar customers.
00:35:40.140 --> 00:35:41.420
I mean, as you know, the polar rate
00:35:41.420 --> 00:35:42.890
is the provider last resort.
00:35:42.890 --> 00:35:44.670
That's what you get sort of booted to
00:35:44.670 --> 00:35:46.920
if your rep goes out of business
00:35:46.920 --> 00:35:48.940
or in a couple of other circumstances.
00:35:48.940 --> 00:35:52.410
Currently, the formula that they have to use when they're,
00:35:52.410 --> 00:35:54.260
you know, the formula that is used
00:35:54.260 --> 00:35:58.690
for some polar plans includes as an element in our rules,
00:35:58.690 --> 00:36:00.470
this realtime price of energy.
00:36:00.470 --> 00:36:02.000
And so we can argue whether or not
00:36:02.000 --> 00:36:04.310
that technically counts as an offer,
00:36:04.310 --> 00:36:06.300
but it seems within the spirit of
00:36:06.300 --> 00:36:07.160
what we're trying to do here,
00:36:07.160 --> 00:36:09.070
we need to get that out of the polar rate.
00:36:09.070 --> 00:36:11.610
And so the current pitch that we have
00:36:11.610 --> 00:36:14.300
and we've sort of socialized it with a few stakeholders
00:36:14.300 --> 00:36:16.730
to make sure it wasn't too upset is, you know,
00:36:16.730 --> 00:36:18.790
right now, reps have a choice
00:36:18.790 --> 00:36:20.780
or the large service providers,
00:36:20.780 --> 00:36:23.453
not the VA reps, but the other,
00:36:25.090 --> 00:36:26.760
sorry, the other polar folks,
00:36:26.760 --> 00:36:28.860
they have a choice between doing like a market base rate
00:36:28.860 --> 00:36:31.050
which is sort of similar to their other plans
00:36:31.050 --> 00:36:32.550
or they can do this formulaic rate
00:36:32.550 --> 00:36:33.383
that I was discussing
00:36:33.383 --> 00:36:34.216
that has the real-time price of energy in it.
00:36:36.268 --> 00:36:38.330
And there are actually different categories
00:36:38.330 --> 00:36:39.900
of customers based on size.
00:36:39.900 --> 00:36:41.197
So there's four different categories
00:36:41.197 --> 00:36:43.690
and the formula is a little bit different for each of them
00:36:43.690 --> 00:36:44.523
which is sort of a,
00:36:44.523 --> 00:36:46.460
kind of a confusing thing anyway.
00:36:46.460 --> 00:36:49.560
And so we're proposing kind of a streamlined approach
00:36:49.560 --> 00:36:53.120
where we get rid of the one that's contingent
00:36:53.120 --> 00:36:57.160
on real time pricing and just go with the market base rate.
00:36:57.160 --> 00:37:00.660
And there is some concern that, you know,
00:37:00.660 --> 00:37:02.650
the benefit of it being keyed
00:37:02.650 --> 00:37:05.280
to the realtime price of energy
00:37:05.280 --> 00:37:07.510
is that have reps have to use this in their up price spikes,
00:37:07.510 --> 00:37:09.460
the reps are protected, but as we've learned,
00:37:09.460 --> 00:37:10.740
that's not great for the customers.
00:37:10.740 --> 00:37:13.840
And so one proposal would be that we allow
00:37:15.641 --> 00:37:18.460
in the formulas there to be multipliers.
00:37:18.460 --> 00:37:21.000
And so you could use your multi-market base rate
00:37:21.000 --> 00:37:21.880
but then you could,
00:37:21.880 --> 00:37:22.990
based on a customer size class,
00:37:22.990 --> 00:37:25.100
maybe there could be like a percentage multiplier
00:37:25.100 --> 00:37:27.240
that the rep would need just to be able to, you know,
00:37:27.240 --> 00:37:28.930
hedge their coverage.
00:37:28.930 --> 00:37:30.185
And so, you know, maybe that's 2%,
00:37:30.185 --> 00:37:31.078
maybe that's 10%
00:37:31.078 --> 00:37:32.470
and it could vary based on class.
00:37:32.470 --> 00:37:34.320
I don't know what that would be right now
00:37:34.320 --> 00:37:35.793
but we think this is a,
00:37:36.800 --> 00:37:39.580
it may not be the end proposal that's the final solution,
00:37:39.580 --> 00:37:42.400
but we think it will spark good conversation
00:37:42.400 --> 00:37:45.450
or good comments to, you know,
00:37:45.450 --> 00:37:46.990
maybe folks out there have better ideas.
00:37:46.990 --> 00:37:47.980
And we just haven't heard from yet.
00:37:47.980 --> 00:37:49.290
Maybe they like it, maybe they don't.
00:37:49.290 --> 00:37:50.960
But we think that it solves the problem
00:37:50.960 --> 00:37:54.300
of getting these energy spiking prices
00:37:54.300 --> 00:37:55.820
out of the polar service
00:37:55.820 --> 00:37:58.440
and is a possible first step.
00:37:58.440 --> 00:38:02.310
But at the least, it would create a range band of risk
00:38:02.310 --> 00:38:03.830
for the consumer?
00:38:03.830 --> 00:38:04.900
That's our hope.
00:38:04.900 --> 00:38:05.870
Okay.
00:38:05.870 --> 00:38:08.320
And so those are...
00:38:08.320 --> 00:38:09.980
That's sort of what we want to do in this space
00:38:09.980 --> 00:38:11.760
of the wholesale index pricing.
00:38:11.760 --> 00:38:13.770
And, you know, I wanted to check first,
00:38:13.770 --> 00:38:15.280
specifically with you, Chairman,
00:38:15.280 --> 00:38:17.947
because, you know, it was one of your comments that said,
00:38:17.947 --> 00:38:18.780
"Oh, make sure
00:38:18.780 --> 00:38:20.267
"we're also thinking about ancillary services."
00:38:20.267 --> 00:38:22.970
And so since what we were doing with these other rates
00:38:22.970 --> 00:38:24.411
was requiring this acknowledgement,
00:38:24.411 --> 00:38:26.940
we're like, okay, we'll just give that similar treatment.
00:38:26.940 --> 00:38:28.980
Maybe that's what you were hoping for.
00:38:28.980 --> 00:38:30.510
Maybe you wanted something more aggressive.
00:38:30.510 --> 00:38:33.760
But this was sort of where we started.
00:38:33.760 --> 00:38:35.600
Yeah, I think that's a good starting point
00:38:35.600 --> 00:38:37.120
and also I appreciate the points you made
00:38:37.120 --> 00:38:40.940
at the beginning of covering any index product.
00:38:40.940 --> 00:38:42.480
And so there's,
00:38:42.480 --> 00:38:43.990
we wanna avoid...
00:38:45.770 --> 00:38:47.430
A customer signing up for something
00:38:47.430 --> 00:38:50.980
that's indexed to some obscure esoteric financial products
00:38:50.980 --> 00:38:52.360
that they have no,
00:38:52.360 --> 00:38:54.470
that they really don't, aren't aware of,
00:38:54.470 --> 00:38:58.620
but is essentially a work around for the provider.
00:38:58.620 --> 00:39:00.050
So I think that's very important.
00:39:00.050 --> 00:39:00.883
I appreciate that.
00:39:00.883 --> 00:39:02.007
Okay, thank you.
00:39:02.007 --> 00:39:05.240
And I would ask as we go through this,
00:39:05.240 --> 00:39:07.900
for all of these scenarios that we're considering,
00:39:07.900 --> 00:39:08.970
and I know this is a straw man,
00:39:08.970 --> 00:39:10.890
this is very much the starting point,
00:39:10.890 --> 00:39:13.720
but as we narrow down the options
00:39:13.720 --> 00:39:16.200
and get closer and closer to
00:39:16.200 --> 00:39:19.600
the final version of all of these different protections.
00:39:19.600 --> 00:39:20.433
Yes, sir.
00:39:20.433 --> 00:39:23.053
Let's make sure to go through examples scenarios.
00:39:24.386 --> 00:39:25.219
Okay.
00:39:25.219 --> 00:39:27.550
And consider what it looks like
00:39:27.550 --> 00:39:29.410
from the customer's perspective.
00:39:29.410 --> 00:39:30.640
I think that's a great idea.
00:39:30.640 --> 00:39:33.080
And I'm sure there are members of the rulemaking team
00:39:33.080 --> 00:39:33.913
that I'm working with,
00:39:33.913 --> 00:39:35.220
who could have been able to do that
00:39:35.220 --> 00:39:36.306
off the cuff with you right now.
00:39:36.306 --> 00:39:37.139
I'm just not that I'm not that person.
00:39:37.139 --> 00:39:37.972
We don't have to do it right now.
00:39:37.972 --> 00:39:38.805
I'm not that person.
00:39:38.805 --> 00:39:40.130
Just, as we go through the process
00:39:40.130 --> 00:39:44.490
and we come up with a new formula or a new multiplier,
00:39:44.490 --> 00:39:48.560
I want to be very careful that we don't caught in
00:39:51.027 --> 00:39:54.300
and we don't get so wrapped up in the technicalities
00:39:54.300 --> 00:39:55.850
of the rulemaking that we forget
00:39:55.850 --> 00:39:59.760
to consider the on-the-ground reality for our customers,
00:39:59.760 --> 00:40:01.910
both residential, consumer,
00:40:01.910 --> 00:40:02.840
and for different products.
00:40:02.840 --> 00:40:05.180
And so let's make sure we think through
00:40:05.180 --> 00:40:09.360
and put numbers to what our proposals look like
00:40:09.360 --> 00:40:11.550
in real life for those real people.
00:40:11.550 --> 00:40:13.080
I think that's excellent guidance.
00:40:13.080 --> 00:40:15.470
And we'll keep that in mind as we go forward.
00:40:15.470 --> 00:40:16.730
Thank you.
00:40:16.730 --> 00:40:18.690
The next component of HB 16
00:40:18.690 --> 00:40:21.250
is that there are new requirements
00:40:21.250 --> 00:40:23.390
with regards to disconnection notices
00:40:23.390 --> 00:40:25.520
in terms of like how frequently they have to be given.
00:40:25.520 --> 00:40:26.840
Previously, it was one.
00:40:26.840 --> 00:40:27.700
Now, it's three.
00:40:27.700 --> 00:40:30.870
And there's a few little requirements in terms of, you know,
00:40:30.870 --> 00:40:33.110
how they have to be displayed on bills and things like that.
00:40:33.110 --> 00:40:36.410
And we don't need to get too deep into the details
00:40:36.410 --> 00:40:37.243
because, you know,
00:40:37.243 --> 00:40:38.530
the legislature told us exactly what we needed to do
00:40:38.530 --> 00:40:39.550
so we're going to do it.
00:40:39.550 --> 00:40:41.500
The one policy call that we did make is
00:40:42.380 --> 00:40:46.340
there is a requirement that just applies to, I think,
00:40:46.340 --> 00:40:47.930
fixed rate products that requires
00:40:47.930 --> 00:40:49.390
if you're doing it with a bill insert,
00:40:49.390 --> 00:40:51.260
it has to be a separate piece of paper
00:40:51.260 --> 00:40:52.860
so that the customer takes notice.
00:40:52.860 --> 00:40:54.730
And in our draft version right now,
00:40:54.730 --> 00:40:57.290
we expand that to all plans because, you know,
00:40:57.290 --> 00:40:59.100
if it's a good idea for some, it's a good idea for all
00:40:59.100 --> 00:41:00.790
with regards to, you should know when your plan's ending
00:41:00.790 --> 00:41:02.140
and what's going to happen.
00:41:03.700 --> 00:41:05.630
The other bill that we sort of, you know,
00:41:05.630 --> 00:41:07.030
this started out as HB 16,
00:41:07.030 --> 00:41:09.680
but there's one component of SB 3
00:41:09.680 --> 00:41:10.730
that we thought we would knock out
00:41:10.730 --> 00:41:12.650
as we were looking at this as well.
00:41:12.650 --> 00:41:17.230
And that is section eight of SB 3 requires, you know,
00:41:17.230 --> 00:41:20.250
the utility is to periodically notify reps
00:41:20.250 --> 00:41:23.210
and then reps to periodically notify their customers
00:41:23.210 --> 00:41:24.300
of a few items.
00:41:24.300 --> 00:41:25.133
And those are sort of
00:41:25.133 --> 00:41:26.900
information about load shedding practices,
00:41:26.900 --> 00:41:29.870
information about how you can get some of these designations
00:41:29.870 --> 00:41:32.050
such as like critical care designations
00:41:32.050 --> 00:41:33.160
and things like that.
00:41:33.160 --> 00:41:37.020
And so in terms of, you know,
00:41:37.020 --> 00:41:39.750
just the idea that reps have to notify periodically,
00:41:39.750 --> 00:41:42.010
the way that we're going to interpret that
00:41:42.010 --> 00:41:43.235
at the beginning is
00:41:43.235 --> 00:41:45.880
we have language that puts it in the, you know,
00:41:45.880 --> 00:41:47.620
the your rights as customer document,
00:41:47.620 --> 00:41:49.360
which, you know, you get sort of at the beginning,
00:41:49.360 --> 00:41:50.240
so you're notified.
00:41:50.240 --> 00:41:53.170
And then we thought the way we're interpreting,
00:41:53.170 --> 00:41:55.600
a useful way to notify periodically
00:41:55.600 --> 00:41:58.740
would be let's have them do it in April and October.
00:41:58.740 --> 00:42:01.010
You know, so it's twice a year and it's, you know,
00:42:01.010 --> 00:42:03.020
before winter and before summer.
00:42:03.020 --> 00:42:04.340
So these shoulder notifications,
00:42:04.340 --> 00:42:06.800
so that's our starting point proposal
00:42:06.800 --> 00:42:09.510
for that component of SB 3.
00:42:09.510 --> 00:42:12.580
Does that rulemaking contemplation
00:42:12.580 --> 00:42:15.408
take care of all of section eight in SB 3
00:42:15.408 --> 00:42:18.370
because SB 3, section eight was,
00:42:18.370 --> 00:42:19.300
it was a big section.
00:42:19.300 --> 00:42:21.453
There was a lot involved there.
00:42:23.097 --> 00:42:24.550
The critical care-
00:42:24.550 --> 00:42:26.190
I think as customers,
00:42:26.190 --> 00:42:27.791
I don't think that it does.
Okay, yeah.
00:42:27.791 --> 00:42:30.090
I mean, we have different groups.
00:42:30.090 --> 00:42:30.923
And so like, you know,
00:42:30.923 --> 00:42:33.460
our critical load team is going to be working on exactly,
00:42:33.460 --> 00:42:34.979
I think what some of these aspects are.
00:42:34.979 --> 00:42:36.850
There are different aspects of our teams that we're working,
00:42:36.850 --> 00:42:39.440
but since we had to open,
00:42:39.440 --> 00:42:41.070
we're opening this part of the rule anyway.
00:42:41.070 --> 00:42:44.300
And so it made sense for this retail customer group
00:42:44.300 --> 00:42:46.490
to just clarify that component.
00:42:46.490 --> 00:42:47.920
And we're sort of doing it by reference.
00:42:47.920 --> 00:42:48.753
We're just like, you know,
00:42:48.753 --> 00:42:52.210
reps, you also have to notify them of these four things,
00:42:52.210 --> 00:42:54.700
whatever it is we decide to do with it here.
00:42:54.700 --> 00:42:56.443
Well yeah, I mean, I agree.
00:42:57.490 --> 00:42:59.760
Organizationally, if that's how you want to proceed.
00:42:59.760 --> 00:43:01.540
I just knew that that section had a couple
00:43:01.540 --> 00:43:03.490
of different policy objectives there
00:43:03.490 --> 00:43:05.230
and they were quite, they were complex.
00:43:05.230 --> 00:43:06.500
So I didn't know if you were going to try
00:43:06.500 --> 00:43:09.890
to take care of it all in this proceeding.
00:43:09.890 --> 00:43:11.157
No, sir.
Okay.
00:43:11.157 --> 00:43:12.580
I think various aspects of Senate Bill 3
00:43:12.580 --> 00:43:17.210
will be included in many things we do for a while.
00:43:17.210 --> 00:43:19.670
And then also just, you know, I have...
00:43:22.640 --> 00:43:24.570
Yeah and so those are the discretion decisions we make.
00:43:24.570 --> 00:43:27.180
Down here, I have two proposed timelines
00:43:27.180 --> 00:43:28.440
and we don't need to go through the details,
00:43:28.440 --> 00:43:30.820
but basically there's the, if everything goes right,
00:43:30.820 --> 00:43:33.880
people are generally on board with what we're doing
00:43:33.880 --> 00:43:35.880
and we just have to make a tweak.
00:43:35.880 --> 00:43:37.190
It's this column on the left
00:43:37.190 --> 00:43:38.760
which would allow us to get you a proposal
00:43:38.760 --> 00:43:40.870
for publication by mid-July.
00:43:40.870 --> 00:43:43.060
But if we get, you know,
00:43:43.060 --> 00:43:45.140
we don't have to summarize comments for straw men.
00:43:45.140 --> 00:43:47.010
So it's not like it's not like the number
00:43:47.010 --> 00:43:48.810
of comments filed would delay us,
00:43:48.810 --> 00:43:51.610
but should people have a lot of good ideas
00:43:51.610 --> 00:43:53.030
or maybe something we did here
00:43:53.030 --> 00:43:55.500
is bad for reasons we didn't think of,
00:43:55.500 --> 00:43:57.450
I have the second timeline that would allow us
00:43:57.450 --> 00:44:00.730
to issue sort of, at staff's discretion,
00:44:00.730 --> 00:44:03.300
a call for reply comments, if we need to,
00:44:03.300 --> 00:44:04.610
or maybe we need briefing questions
00:44:04.610 --> 00:44:06.820
and then hopefully, then we would just bump it back
00:44:06.820 --> 00:44:09.313
to the open meeting at the end of July.
00:44:11.064 --> 00:44:13.110
And so if you guys are comfortable with the proposal
00:44:13.110 --> 00:44:13.943
and that timeframe,
00:44:13.943 --> 00:44:16.710
I think that's the guidance that we need at this point.
00:44:16.710 --> 00:44:18.200
I'm comfortable with that timeframe.
00:44:18.200 --> 00:44:19.033
Same here.
00:44:19.033 --> 00:44:23.490
And I would also say I appreciate the process
00:44:23.490 --> 00:44:27.160
and starting out with a straw man
00:44:27.160 --> 00:44:29.740
to frame the discussion
00:44:29.740 --> 00:44:32.800
and essentially, giving the general public
00:44:32.800 --> 00:44:34.930
two chances to participate in the process
00:44:34.930 --> 00:44:36.130
rather than the standard
00:44:37.930 --> 00:44:40.540
one phase of public comment.
00:44:40.540 --> 00:44:42.357
Thank you, happy to do it.
00:44:42.357 --> 00:44:43.720
Yes, sir.
00:44:43.720 --> 00:44:45.020
Anything else for David?
00:44:45.020 --> 00:44:46.730
No, sir, I'm good.
00:44:46.730 --> 00:44:47.620
Good.
Thank you.
00:44:47.620 --> 00:44:48.870
Thank you, Mr. Smelser.
00:44:52.150 --> 00:44:55.140
That covers item number four.
00:44:55.140 --> 00:44:56.100
Item number five.
00:44:56.100 --> 00:44:57.760
I don't have anything for items number five through 10.
00:44:57.760 --> 00:44:59.083
Do you?
I do not.
00:45:00.060 --> 00:45:02.423
That brings us to item 11.
00:45:03.780 --> 00:45:06.580
We will hear from ERCOT
00:45:06.580 --> 00:45:11.010
on an overview of this week.
00:45:11.010 --> 00:45:11.990
And...
00:45:13.300 --> 00:45:15.120
We also hear
00:45:16.500 --> 00:45:17.333
some comments from them
00:45:17.333 --> 00:45:20.330
on both on the operations and planning component.
00:45:20.330 --> 00:45:23.047
I think we'll start with Woody Rickerson.
00:45:35.941 --> 00:45:38.050
Woody Rickerson.
00:45:38.050 --> 00:45:39.220
Turn it on.
Chairman?
00:45:39.220 --> 00:45:40.760
Would you like to take a moment to make sure
00:45:40.760 --> 00:45:43.340
that the call is going okay?
00:45:43.340 --> 00:45:45.240
We're hearing a little feedback there.
00:45:48.470 --> 00:45:49.421
Let's turn down the volume.
00:45:49.421 --> 00:45:52.254
Need to check with the operator.
00:45:59.810 --> 00:46:01.250
If the operator can hear us,
00:46:01.250 --> 00:46:03.500
Don, could you check on that feedback please?
00:46:04.760 --> 00:46:05.630
Yes sir, I can.
00:46:05.630 --> 00:46:06.463
Just one moment.
00:46:06.463 --> 00:46:07.463
Thank you.
00:46:22.518 --> 00:46:24.133
Okay, you should be all set now.
00:46:24.133 --> 00:46:26.382
Thank you very much.
Thank you, Don.
00:46:26.382 --> 00:46:27.820
Sorry about that.
00:46:27.820 --> 00:46:29.010
Mr. Rickerson, thank you for being here.
00:46:29.010 --> 00:46:30.940
Woody Rickerson, vice-president of grid planning
00:46:30.940 --> 00:46:32.240
and operations, thank you.
00:46:35.440 --> 00:46:36.733
Yeah, well, first of all,
00:46:37.639 --> 00:46:40.533
I want to thank Texans for conservation this week.
00:46:41.650 --> 00:46:44.010
I think that's shown to be a very effective tool.
00:46:44.010 --> 00:46:45.360
A lot of ISO's use it.
00:46:45.360 --> 00:46:48.520
And this week, we saw what we thought was going
00:46:48.520 --> 00:46:51.970
to be a plus 70,000 megawatt peak
00:46:51.970 --> 00:46:53.457
reduced down to 70,000.
00:46:53.457 --> 00:46:55.210
And so all week long,
00:46:55.210 --> 00:46:56.990
we've had the conservation alert
00:46:56.990 --> 00:46:58.920
and we've seen good response all week.
00:46:58.920 --> 00:47:01.590
So that has, because of those actions,
00:47:01.590 --> 00:47:04.723
we have kept the grid in a very reliable state.
00:47:05.850 --> 00:47:07.573
Excellent, that's,
00:47:11.669 --> 00:47:12.502
a unique,
00:47:12.502 --> 00:47:14.560
that's a new and different approach to conservation notices.
00:47:14.560 --> 00:47:16.040
Is that correct?
00:47:16.040 --> 00:47:18.410
We have used conservation notices in the past
00:47:18.410 --> 00:47:21.540
but this is a more conservative approach
00:47:21.540 --> 00:47:23.970
to operating the grid.
00:47:23.970 --> 00:47:25.810
In a different timeline, you said?
00:47:25.810 --> 00:47:27.390
A different time line, yes.
00:47:27.390 --> 00:47:28.560
Okay, I appreciate that.
00:47:28.560 --> 00:47:32.320
I think that has helped Texans
00:47:33.410 --> 00:47:36.610
learn more about how much conservation can help
00:47:36.610 --> 00:47:39.870
and also be more responsive
00:47:39.870 --> 00:47:41.750
over the greater period of time
00:47:42.720 --> 00:47:46.260
rather than the hourly on and off again.
00:47:46.260 --> 00:47:47.093
Right, you know,
00:47:47.093 --> 00:47:51.100
our job at ERCOT is to balance generation and load.
00:47:51.100 --> 00:47:53.270
Conservation gives us a tool to balance
00:47:53.270 --> 00:47:54.470
the load side of the equation,
00:47:54.470 --> 00:47:55.990
just like we've used generation
00:47:55.990 --> 00:47:57.870
to balance the generation side.
00:47:57.870 --> 00:47:59.600
So it's nice to have something on both sides
00:47:59.600 --> 00:48:01.070
of that equation.
00:48:01.070 --> 00:48:01.903
Absolutely.
00:48:01.903 --> 00:48:06.730
And it's not unlike the mini conservation
00:48:06.730 --> 00:48:08.480
calls we hear in Texas each summer
00:48:08.480 --> 00:48:10.563
for conserving water.
Right.
00:48:12.600 --> 00:48:14.710
We ask people not to water their lawn every day.
00:48:14.710 --> 00:48:17.040
And when you do water your lawn, please do it at night
00:48:17.040 --> 00:48:18.800
when it's not as hot and evaporate.
00:48:18.800 --> 00:48:20.673
Don't wash your car every week.
00:48:21.860 --> 00:48:22.910
Et cetera, et cetera.
00:48:23.820 --> 00:48:24.653
Thank you.
00:48:27.016 --> 00:48:29.783
Could you give us an overview of the week,
00:48:31.050 --> 00:48:34.140
kind of going back to the last, I guess Saturday, Sunday,
00:48:34.140 --> 00:48:35.910
the circumstances we found ourselves in
00:48:35.910 --> 00:48:39.120
and how EROCT managed them?
00:48:39.120 --> 00:48:41.423
Yeah, so all week long, we have had,
00:48:42.320 --> 00:48:44.750
whether that resulted in loads
00:48:44.750 --> 00:48:48.650
that could have been higher than 70,000 megawatts of 72,000.
00:48:48.650 --> 00:48:51.720
In fact we set a June peak already,
00:48:51.720 --> 00:48:52.920
even with conservation,
00:48:52.920 --> 00:48:55.570
we set a new June peak.
00:48:55.570 --> 00:48:58.080
So this has been hot weather
00:48:58.080 --> 00:49:00.170
resulting in high loads.
00:49:00.170 --> 00:49:04.880
The wind output has been relatively low this week,
00:49:04.880 --> 00:49:05.853
over peak.
00:49:07.740 --> 00:49:11.730
We also had an unusual number of forced outages
00:49:11.730 --> 00:49:13.090
of thermal units.
00:49:13.090 --> 00:49:15.139
So we're investigating that.
00:49:15.139 --> 00:49:17.710
We're gonna try to understand better why
00:49:17.710 --> 00:49:21.450
we've had as many thermal units on outages as we've had,
00:49:21.450 --> 00:49:23.510
but those two factors
00:49:24.470 --> 00:49:25.757
along with the, you know,
00:49:25.757 --> 00:49:28.010
the high number of generation outages,
00:49:28.010 --> 00:49:29.200
the low wind output
00:49:29.200 --> 00:49:32.840
and just the temperature itself causing load to be high
00:49:32.840 --> 00:49:35.030
is what has caused the concern this week.
00:49:35.030 --> 00:49:37.130
Okay, so-
Go ahead.
00:49:37.130 --> 00:49:38.280
So, at a high level,
00:49:38.280 --> 00:49:41.670
we had a confluence of three factors, right?
00:49:41.670 --> 00:49:42.503
We had...
00:49:44.400 --> 00:49:47.483
A record breaking amount of demand for electricity in June
00:49:47.483 --> 00:49:49.450
that we hadn't seen before.
Right?
00:49:49.450 --> 00:49:50.580
We all know Texas is growing.
00:49:50.580 --> 00:49:53.080
We got more people coming in hotter weather
00:49:53.080 --> 00:49:55.550
than we've seen typically in June.
00:49:55.550 --> 00:49:57.380
Same amount of generation.
00:49:57.380 --> 00:50:00.423
We've got more people meaning more electricity.
00:50:01.430 --> 00:50:04.800
The second factor was lower generation from wind
00:50:04.800 --> 00:50:06.210
than we expected.
00:50:06.210 --> 00:50:07.630
Right.
Accurate.
00:50:07.630 --> 00:50:08.463
And then third,
00:50:08.463 --> 00:50:12.450
we had an unusually high number of mechanical failures,
00:50:12.450 --> 00:50:13.393
the forced outage,
00:50:14.460 --> 00:50:17.120
that's machinery and our generators breaking in real time.
00:50:17.120 --> 00:50:18.200
These weren't planned outages.
00:50:18.200 --> 00:50:19.033
That's correct.
Correct?
00:50:19.033 --> 00:50:20.747
And that's an important distinction
00:50:22.427 --> 00:50:23.273
is that we have,
00:50:25.140 --> 00:50:28.320
there are two types of generator outages, roughly speaking.
00:50:28.320 --> 00:50:30.090
There's planned outages that we have
00:50:30.090 --> 00:50:32.390
where generators need to do maintenance
00:50:32.390 --> 00:50:33.500
to get ready for a season.
00:50:33.500 --> 00:50:34.980
And then there's unplanned outages
00:50:34.980 --> 00:50:37.620
where things just break and they have to go offline.
00:50:37.620 --> 00:50:40.220
And what we've had this week has been unplanned
00:50:40.220 --> 00:50:43.020
forced mechanical failures of generators.
00:50:43.020 --> 00:50:44.730
So those aren't things that ERCOT are planned.
00:50:44.730 --> 00:50:46.110
Those aren't things that we approved.
00:50:46.110 --> 00:50:48.390
They aren't things that we factored, you know,
00:50:48.390 --> 00:50:50.130
if a forced outage happens tomorrow,
00:50:50.130 --> 00:50:52.400
that's not in our plans today for tomorrow.
00:50:52.400 --> 00:50:54.435
Yeah, that's machinery breaking as it's running.
00:50:54.435 --> 00:50:55.268
That's right.
00:50:55.268 --> 00:50:56.700
That's like the flat tire on the side of the road.
00:50:56.700 --> 00:50:58.980
And you don't anticipate that, but you have a spare.
00:50:58.980 --> 00:51:01.300
Hey Woody, I think this is really useful
00:51:01.300 --> 00:51:02.490
to kind of have you up here.
00:51:02.490 --> 00:51:05.920
And just from a, as we start to try to marry up
00:51:05.920 --> 00:51:07.310
Senate bill three
00:51:07.310 --> 00:51:10.940
and those market directions and reforms,
00:51:10.940 --> 00:51:13.750
I believe the legislature considered them reforms
00:51:13.750 --> 00:51:15.070
to a degree.
00:51:15.070 --> 00:51:16.400
And we talk about this event,
00:51:16.400 --> 00:51:19.200
this is a great kind of a test case
00:51:19.200 --> 00:51:22.190
to sort of see how the market could respond
00:51:22.190 --> 00:51:25.773
or what that bill could target in terms of policy impacts.
00:51:27.850 --> 00:51:31.063
Can you tell me just from a, as a dataset,
00:51:32.180 --> 00:51:36.720
what was the lowest amount of wind production that we saw
00:51:36.720 --> 00:51:39.080
over the last three-day period?
00:51:39.080 --> 00:51:41.440
How low did it get?
00:51:41.440 --> 00:51:44.770
Well, we saw 118 megawatts.
00:51:44.770 --> 00:51:46.700
Okay, that's the number of records.
00:51:46.700 --> 00:51:47.690
I think that's important.
00:51:47.690 --> 00:51:48.710
I did not know that.
00:51:48.710 --> 00:51:50.370
That was an instantaneous number.
00:51:50.370 --> 00:51:51.290
I mean, those are very, very-
00:51:51.290 --> 00:51:52.840
Yes sir, a spot in time.
00:51:52.840 --> 00:51:54.490
Very the usual number.
00:51:54.490 --> 00:51:55.452
And it wasn't over a peak period.
00:51:55.452 --> 00:51:57.110
I know, yeah.
00:51:57.110 --> 00:51:59.120
But we saw 118 megawatts.
00:51:59.120 --> 00:52:00.957
Well, I can tell you where I was over that three days
00:52:00.957 --> 00:52:03.200
and you were busy fighting this fight
00:52:03.200 --> 00:52:04.820
but I was in my office staring out
00:52:04.820 --> 00:52:07.770
at the Moody Bank building, looking at the flagpoles
00:52:07.770 --> 00:52:10.893
and looking for any type of movement with the flags.
00:52:11.960 --> 00:52:14.520
And literally, just anecdotally,
00:52:14.520 --> 00:52:18.070
that's how deep the doldrums had set in
00:52:18.070 --> 00:52:19.910
across the state of Texas.
00:52:19.910 --> 00:52:21.000
And we do see that happen.
00:52:21.000 --> 00:52:22.200
Sure.
Occasionally.
00:52:23.090 --> 00:52:25.230
And it was earlier in the morning.
00:52:25.230 --> 00:52:27.150
It wasn't over peak.
00:52:27.150 --> 00:52:29.944
The load at that point was not at the highest point
00:52:29.944 --> 00:52:30.920
we were going to see that day,
00:52:30.920 --> 00:52:32.910
but it does show the variability
00:52:32.910 --> 00:52:34.770
that we're subject to.
00:52:34.770 --> 00:52:37.400
And so how great a fluctuation
00:52:37.400 --> 00:52:38.670
and I'm going to take it in two parts
00:52:38.670 --> 00:52:40.803
so for viewers watching,
00:52:41.867 --> 00:52:42.970
I'm going to talk about,
00:52:42.970 --> 00:52:45.270
ask questions about the thermal side of this, as well.
00:52:45.270 --> 00:52:46.630
So this is not partisan.
00:52:46.630 --> 00:52:50.060
This is just identifying data points
00:52:50.060 --> 00:52:51.555
that I think we need to identify
00:52:51.555 --> 00:52:56.370
to help marry all this together in SB 3 implementation.
00:52:56.370 --> 00:52:58.690
But on solar, Monday,
00:52:58.690 --> 00:53:01.210
Monday was cloudy and we saw
00:53:01.210 --> 00:53:02.870
a bit of a solar reduction
00:53:02.870 --> 00:53:05.510
compared to historical averages, as well,
00:53:05.510 --> 00:53:08.910
'cause we've got 7,000 megawatts total installed.
00:53:08.910 --> 00:53:10.410
We have currently,
00:53:10.410 --> 00:53:12.010
I think by the end of the summer,
00:53:12.010 --> 00:53:13.370
we're expecting to have seven.
00:53:13.370 --> 00:53:14.860
Oh, I'm sorry.
00:53:14.860 --> 00:53:17.150
I think right now the most we have seen
00:53:17.150 --> 00:53:21.570
is maybe a little over 6,000 or right up to 6,000 megawatts.
00:53:21.570 --> 00:53:24.342
And they performed at five on Monday, then?
00:53:24.342 --> 00:53:25.175
Okay.
00:53:25.175 --> 00:53:26.350
And we have seen solar fluctuate
00:53:26.350 --> 00:53:27.860
because of cloud cover over,
00:53:27.860 --> 00:53:28.960
when they're supposed to be running,
00:53:28.960 --> 00:53:29.932
or when they could have been running,
00:53:29.932 --> 00:53:30.765
they're not supposed to,
00:53:30.765 --> 00:53:31.598
when they could have been running,
00:53:31.598 --> 00:53:34.543
we've seen 5,500 to 5,000 at times.
00:53:35.380 --> 00:53:38.133
Okay and on the thermal side,
00:53:40.610 --> 00:53:43.440
it was those mechanical breakages that...
00:53:44.300 --> 00:53:45.930
When did ERCOT
00:53:48.540 --> 00:53:51.500
really get notified of the forced outages?
00:53:51.500 --> 00:53:53.300
I knew there were kind of, it came in waves.
00:53:53.300 --> 00:53:56.300
So you could sort of break it down into the first wave,
00:53:56.300 --> 00:53:57.320
which was identified
00:53:57.320 --> 00:54:01.020
by your reliability unit commitment exercise
00:54:01.020 --> 00:54:03.810
that you went into during the weekend.
00:54:03.810 --> 00:54:06.040
And then it sort of crescendoed,
00:54:06.040 --> 00:54:09.518
as we ramped up to meet that heavy load,
00:54:09.518 --> 00:54:11.612
you know, that increased demand.
00:54:11.612 --> 00:54:15.040
So we have eyes on all generation, all the time.
00:54:15.040 --> 00:54:16.070
So we have telemetry.
00:54:16.070 --> 00:54:19.350
So as soon as a plant is forced out
00:54:19.350 --> 00:54:21.280
because of a mechanical problem,
00:54:21.280 --> 00:54:23.950
we see it as soon as it happens.
00:54:23.950 --> 00:54:27.770
The plant operator or the qualified,
00:54:27.770 --> 00:54:31.450
the queasy will actually give us the data shortly afterwards
00:54:31.450 --> 00:54:33.120
in our outage scheduler
00:54:33.120 --> 00:54:34.830
but we're watching the plants all the time.
00:54:34.830 --> 00:54:38.070
And so we have what we call a forced outage detector
00:54:38.070 --> 00:54:41.010
that tells our operations as soon as it happens.
00:54:41.010 --> 00:54:43.970
So that answers that part of the question,
00:54:43.970 --> 00:54:48.330
but ERCOT relies a lot on forecast.
00:54:48.330 --> 00:54:49.710
So we have a wind forecast.
00:54:49.710 --> 00:54:51.010
We have a solar forecast.
00:54:51.010 --> 00:54:52.150
We have a load forecast.
00:54:52.150 --> 00:54:54.380
And so when we're looking at future days,
00:54:54.380 --> 00:54:57.423
we're factoring all those forecast into place.
00:54:58.510 --> 00:55:01.370
We also have what we call a current operating plan
00:55:01.370 --> 00:55:05.890
which is people will call it the COP, C-O-P, the cop.
00:55:05.890 --> 00:55:08.763
The COP actually will tell us,
00:55:09.620 --> 00:55:14.400
you can think of the COP as a thermal generation forecast.
00:55:14.400 --> 00:55:15.710
So the COP tells us,
00:55:15.710 --> 00:55:17.570
so you think about, you have a wind forecast
00:55:17.570 --> 00:55:19.650
and a solar forecast,
00:55:19.650 --> 00:55:21.890
they also put in a COP and a load forecast.
00:55:21.890 --> 00:55:24.820
And then the COP for thermal generation
00:55:24.820 --> 00:55:26.427
is our thermal generation forecast.
00:55:26.427 --> 00:55:28.370
And so we factor all of those things
00:55:28.370 --> 00:55:30.330
into future day studies.
00:55:30.330 --> 00:55:31.163
So if we're looking at
00:55:31.163 --> 00:55:33.750
what we think tomorrow's peak looks like,
00:55:33.750 --> 00:55:36.680
we put all those forecasts in and we run studies
00:55:36.680 --> 00:55:40.750
to make sure that any reliability problems we're gonna have,
00:55:40.750 --> 00:55:42.990
we anticipate those and take care of them
00:55:42.990 --> 00:55:44.910
before they get to real-time.
00:55:44.910 --> 00:55:46.430
How much?
00:55:46.430 --> 00:55:47.263
Go ahead.
00:55:47.263 --> 00:55:48.500
Our objective is always
00:55:48.500 --> 00:55:52.260
to root out problems before they get to real time
00:55:52.260 --> 00:55:54.250
so that our operations run smoothly.
00:55:54.250 --> 00:55:55.520
So if there's something we can do today
00:55:55.520 --> 00:55:57.890
to fix a problem tomorrow, we'll do that.
00:55:57.890 --> 00:56:00.660
And the better the information we have,
00:56:00.660 --> 00:56:02.420
the better our forecasts are,
00:56:02.420 --> 00:56:04.600
the more problems that we can solve
00:56:04.600 --> 00:56:06.350
before they get to real-time.
00:56:06.350 --> 00:56:08.073
I know we've seen the,
00:56:09.370 --> 00:56:11.740
wind, solar forecast,
00:56:11.740 --> 00:56:13.590
the load forecast that you mentioned.
00:56:14.800 --> 00:56:18.723
Warren's going to speak to that a little bit later,
00:56:19.730 --> 00:56:21.410
and those go,
00:56:21.410 --> 00:56:24.010
Warren can give you a forecast for the whole summer,
00:56:24.010 --> 00:56:25.840
for a month, for a few days.
00:56:25.840 --> 00:56:28.220
And of course, the shorter the timeline,
00:56:28.220 --> 00:56:30.970
the more accurate.
That's right.
00:56:30.970 --> 00:56:34.770
But the forecast can extend over substantial timelines.
00:56:34.770 --> 00:56:38.030
How far in advance does your thermal generation forecast,
00:56:38.030 --> 00:56:38.870
the current offloading plant,
00:56:38.870 --> 00:56:40.690
how far in advance does that forecast look?
00:56:40.690 --> 00:56:42.360
It's a seven day forecast
00:56:42.360 --> 00:56:45.230
but the data in that forecast is not very good
00:56:45.230 --> 00:56:47.500
more than 18 to 24 hours out.
00:56:47.500 --> 00:56:50.410
So it's not something that we can really rely on
00:56:50.410 --> 00:56:52.540
for a three day outlook or a four day
00:56:52.540 --> 00:56:54.450
or even a two day outlook.
00:56:54.450 --> 00:56:56.440
So when we're looking at studies
00:56:57.560 --> 00:56:59.050
for two days from now,
00:56:59.050 --> 00:57:00.310
we have to make assumptions
00:57:00.310 --> 00:57:02.520
on what that thermal generation is going to do
00:57:02.520 --> 00:57:04.320
because if we just put in what was in the COP,
00:57:04.320 --> 00:57:06.840
we wouldn't have enough generation to run the system.
00:57:06.840 --> 00:57:09.260
Okay, so when we're looking at
00:57:10.750 --> 00:57:13.340
wind generation, solar generation
00:57:14.600 --> 00:57:18.930
and looking at demand for electricity on the load side,
00:57:18.930 --> 00:57:23.930
you've got 24, 48, 72-hour week ahead forecast.
00:57:24.380 --> 00:57:27.380
And again, the longer the timeline, the more,
00:57:27.380 --> 00:57:28.650
the harder it is to predict
00:57:28.650 --> 00:57:32.130
but for forecasting thermal generation,
00:57:32.130 --> 00:57:35.190
you've got at best 18 hours, maybe 24?
00:57:35.190 --> 00:57:36.920
18 to 24 hours is, yes.
00:57:36.920 --> 00:57:39.010
And after that, you don't have any visibility?
00:57:39.010 --> 00:57:41.130
We don't have good visibility, no.
00:57:41.130 --> 00:57:42.150
Okay.
00:57:42.150 --> 00:57:44.080
There's some in there, but it's not,
00:57:44.080 --> 00:57:49.053
you could not plug that COP data into a two-day out,
00:57:50.890 --> 00:57:52.687
computer simulation and be able to run it.
00:57:52.687 --> 00:57:53.990
And you have to add some stuff.
00:57:53.990 --> 00:57:55.100
You have to make some assumptions
00:57:55.100 --> 00:57:58.060
and fill in the gaps because the information's not complete.
00:57:58.060 --> 00:57:59.680
That would seem less than ideal.
00:57:59.680 --> 00:58:00.812
Hmm hmm.
00:58:00.812 --> 00:58:02.830
Is it fair to say that's a big gap
00:58:02.830 --> 00:58:06.340
in our ability to-
Yes.
00:58:06.340 --> 00:58:08.650
Preplan and manage-
That's right.
00:58:08.650 --> 00:58:12.589
So some of the things we're looking at beforehand,
00:58:12.589 --> 00:58:16.050
if someone wants to take an outage on a transmission line,
00:58:16.050 --> 00:58:18.230
well, we needed an accurate generation plant
00:58:18.230 --> 00:58:20.080
to understand if we can take that outage.
00:58:20.080 --> 00:58:21.900
If we don't have good COP data,
00:58:21.900 --> 00:58:26.500
then we could approve an outage on a transmission line
00:58:26.500 --> 00:58:27.830
and the generation needed
00:58:27.830 --> 00:58:29.580
to support that outage isn't there.
00:58:30.440 --> 00:58:32.300
And so you have to,
00:58:32.300 --> 00:58:33.840
it creates a problem that you have to deal with
00:58:33.840 --> 00:58:34.673
in real time.
00:58:34.673 --> 00:58:37.010
So that's an example of why good COP data is important.
00:58:37.010 --> 00:58:40.310
So you're talking about like a planned outage,
00:58:40.310 --> 00:58:41.175
like for maintenance?
00:58:41.175 --> 00:58:42.008
A planned outage, that's right.
00:58:42.008 --> 00:58:44.580
So you're looking ahead and saying next Monday,
00:58:44.580 --> 00:58:46.280
if somebody asks you,
00:58:46.280 --> 00:58:49.730
we need to take our generation down
00:58:49.730 --> 00:58:51.890
to perform maintenance,
00:58:51.890 --> 00:58:54.360
to make sure it's ready for July and August.
00:58:54.360 --> 00:58:57.120
And when that request comes into ERCOT,
00:58:57.120 --> 00:58:59.300
I know y'all try to manage that
00:58:59.300 --> 00:59:01.640
so you don't have a lot of people doing maintenance
00:59:01.640 --> 00:59:03.650
at the same time, obviously,
00:59:03.650 --> 00:59:04.820
but when that information
00:59:04.820 --> 00:59:07.363
or that request for maintenance comes in to ERCOT,
00:59:08.740 --> 00:59:10.610
because you don't have more visibility
00:59:10.610 --> 00:59:13.463
into the forecast of what generators will be,
00:59:13.463 --> 00:59:15.463
what thermal generators will be running,
00:59:16.380 --> 00:59:18.560
you don't know, you're just guessing?
00:59:18.560 --> 00:59:20.050
We are, yes.
00:59:20.050 --> 00:59:21.720
We are basing our assumptions
00:59:21.720 --> 00:59:22.920
on what's happened in the past,
00:59:22.920 --> 00:59:24.750
but we don't have good operating information
00:59:24.750 --> 00:59:26.740
or as good as we could have.
00:59:26.740 --> 00:59:29.223
What, how do we make that better?
00:59:30.070 --> 00:59:32.260
Well, one of the things we're doing,
00:59:32.260 --> 00:59:34.420
we have started doing more of now
00:59:34.420 --> 00:59:37.840
is bringing, making out of market decisions
00:59:37.840 --> 00:59:40.340
to bring new generation online.
00:59:40.340 --> 00:59:42.450
You'll hear people talk about that as a RUC,
00:59:42.450 --> 00:59:43.283
reliability unit-
00:59:43.283 --> 00:59:44.970
Okay.
It's not new generation.
00:59:44.970 --> 00:59:47.130
It's existing generation that you are moving
00:59:47.130 --> 00:59:48.000
into an operational status.
00:59:48.000 --> 00:59:50.363
Well, I'm thinking, hold on, before we get to that,
00:59:50.363 --> 00:59:51.196
I want to cover that.
00:59:51.196 --> 00:59:53.773
Before we get into how you're mitigating that,
00:59:55.300 --> 00:59:57.540
how would you make your forecast better?
00:59:57.540 --> 00:59:59.000
Well having accurate COP data
00:59:59.000 --> 01:00:00.000
would make our forecast better.
01:00:00.000 --> 01:00:01.150
Okay.
01:00:01.150 --> 01:00:05.100
We're also, we're heavily investing in improving
01:00:05.100 --> 01:00:06.480
our current forecasting methods.
01:00:06.480 --> 01:00:07.850
We've hired new people.
01:00:07.850 --> 01:00:10.680
We put some of our top talent in positions
01:00:10.680 --> 01:00:12.861
to help us with forecasting.
01:00:12.861 --> 01:00:14.653
So we're developing,
01:00:15.750 --> 01:00:18.200
we're looking at developing demand forecast.
01:00:18.200 --> 01:00:19.722
So we don't really have an understanding
01:00:19.722 --> 01:00:20.978
of what the demand response is,
01:00:20.978 --> 01:00:21.811
understanding what force EP response is,
01:00:23.706 --> 01:00:26.840
understanding the impact that rooftop solar,
01:00:26.840 --> 01:00:28.590
that electric vehicles have.
01:00:28.590 --> 01:00:30.640
All those things factor into that load forecast.
01:00:30.640 --> 01:00:31.473
Absolutely.
01:00:31.473 --> 01:00:33.000
So we're investing in understanding what those are
01:00:33.000 --> 01:00:35.060
so we have a better overall forecast.
01:00:35.060 --> 01:00:36.490
That's incredibly important
01:00:36.490 --> 01:00:38.230
but when you say better data on the COP,
01:00:38.230 --> 01:00:40.910
the better data on knowing which thermal generators
01:00:40.910 --> 01:00:43.420
are gonna be running over the next four or five
01:00:43.420 --> 01:00:45.040
or even two, three days?
01:00:45.040 --> 01:00:45.873
Even two or three days, yeah.
01:00:45.873 --> 01:00:47.550
That would be better than we have.
01:00:47.550 --> 01:00:51.070
What information do you need to improve that?
01:00:51.070 --> 01:00:51.950
You said better data.
01:00:51.950 --> 01:00:52.783
What does that look like?
01:00:52.783 --> 01:00:54.080
I mean, I know it's more complex
01:00:54.080 --> 01:00:55.740
than we can list or go through here
01:00:55.740 --> 01:00:58.220
but what, just a at a high level, what would that look like?
01:00:58.220 --> 01:00:59.053
It would...
01:01:02.120 --> 01:01:05.960
The COP data that they provide would be more accurate.
01:01:05.960 --> 01:01:07.610
It would be a better indication
01:01:07.610 --> 01:01:09.433
of exactly what's going to happen to those generators
01:01:09.433 --> 01:01:11.256
over the next few days.
01:01:11.256 --> 01:01:13.060
How the owners of those generators
01:01:13.060 --> 01:01:14.493
are planning on running them or?
01:01:14.493 --> 01:01:16.140
That's right.
01:01:16.140 --> 01:01:18.000
What they anticipate doing with those generators
01:01:18.000 --> 01:01:19.010
over the next few days.
01:01:19.010 --> 01:01:21.180
How much are they going to run them?
01:01:21.180 --> 01:01:22.630
That's what that current operating plan
01:01:22.630 --> 01:01:23.463
is supposed to give us.
01:01:23.463 --> 01:01:25.080
And it was supposed to go out seven days
01:01:25.080 --> 01:01:26.965
in the original market design.
01:01:26.965 --> 01:01:29.350
It was an indication over seven days
01:01:29.350 --> 01:01:31.320
of what generators were going to do.
01:01:31.320 --> 01:01:32.610
And there's various market reasons
01:01:32.610 --> 01:01:34.700
why that hasn't worked out,
01:01:34.700 --> 01:01:38.120
but only having good COP data
01:01:38.120 --> 01:01:41.790
in the 18 to 24-hour period is problematic.
01:01:41.790 --> 01:01:44.803
And we talked about that some during the summer assessment,
01:01:45.758 --> 01:01:47.590
the summer preparatory meeting,
01:01:47.590 --> 01:01:49.860
we brought some graphs out and showed that
01:01:49.860 --> 01:01:52.210
and that's remained the problem.
01:01:52.210 --> 01:01:54.563
Yeah and I think one of the,
01:01:55.850 --> 01:01:59.543
and again, in the competitive paradigm,
01:02:00.500 --> 01:02:02.290
everybody has been resistant
01:02:02.290 --> 01:02:04.270
or a lot of market participants
01:02:04.270 --> 01:02:06.530
have been resistant to change that
01:02:06.530 --> 01:02:07.363
because again,
01:02:07.363 --> 01:02:09.920
it affects what their competitors do
01:02:09.920 --> 01:02:12.310
and reacting to some of those base load generators.
01:02:12.310 --> 01:02:13.290
They're built, right, I mean,
01:02:13.290 --> 01:02:16.040
ultimately when that nuke is running,
01:02:16.040 --> 01:02:17.380
when it's running steady state
01:02:17.380 --> 01:02:19.440
or when those coal plants are running steady state,
01:02:19.440 --> 01:02:22.420
it's just layers of, you know it's going to be there
01:02:22.420 --> 01:02:24.310
and they're going to be running either full out,
01:02:24.310 --> 01:02:25.950
hopefully for your purposes
01:02:27.430 --> 01:02:30.690
or at different levels.
01:02:30.690 --> 01:02:32.610
And then the peakers start playing in,
01:02:32.610 --> 01:02:35.220
you know, so they're all trying to hit these varying prices
01:02:35.220 --> 01:02:36.700
especially when we're not talking about peak
01:02:36.700 --> 01:02:39.740
'cause at peak, it's a totally different animal.
01:02:39.740 --> 01:02:42.683
Right, yeah, at peak, we've been everything running, so.
01:02:42.683 --> 01:02:45.570
And the market considerations are important
01:02:45.570 --> 01:02:47.740
but just the,
01:02:47.740 --> 01:02:48.990
they're very important.
01:02:48.990 --> 01:02:51.470
I know we've got Carrie here from the Market Monitor,
01:02:51.470 --> 01:02:54.910
so we can bring her in if we need to,
01:02:54.910 --> 01:02:56.133
to make sure.
01:02:57.350 --> 01:02:58.460
The market considerations,
01:02:58.460 --> 01:03:00.980
both for the competitors in the market
01:03:00.980 --> 01:03:04.100
are acknowledging and mitigated.
01:03:04.100 --> 01:03:08.580
But also to make sure that there's not market manipulation
01:03:08.580 --> 01:03:09.843
that harms consumers,
01:03:12.230 --> 01:03:14.850
and when you say better data for your thermal forecast,
01:03:14.850 --> 01:03:17.250
looking ahead to see what's running, going to be running.
01:03:17.250 --> 01:03:20.623
so you can better manage the raw ability of the grid.
01:03:20.623 --> 01:03:23.360
That information that comes in,
01:03:23.360 --> 01:03:25.410
that data would be confidential.
01:03:25.410 --> 01:03:26.520
That's right.
01:03:26.520 --> 01:03:29.290
So it should not be out there.
01:03:29.290 --> 01:03:31.130
Right, all of our data,
01:03:31.130 --> 01:03:33.120
internal studies are all confidential.
01:03:33.120 --> 01:03:35.440
No one sees those except us.
01:03:35.440 --> 01:03:36.800
Okay.
01:03:36.800 --> 01:03:38.173
That seems like we need,
01:03:39.170 --> 01:03:40.270
something we need to improve on,
01:03:40.270 --> 01:03:41.940
can improve on.
01:03:41.940 --> 01:03:44.220
Is there any functional reason we couldn't improve
01:03:44.220 --> 01:03:45.053
getting that data or-
01:03:45.053 --> 01:03:47.220
There's no functional reason we couldn't.
01:03:47.220 --> 01:03:48.670
I mean, there'll be some,
01:03:48.670 --> 01:03:50.680
I mean, it is what it is for reasons,
01:03:50.680 --> 01:03:53.110
but from a functional systems standpoint,
01:03:53.110 --> 01:03:54.650
we're set up to receive that and use it.
01:03:54.650 --> 01:03:57.130
Okay.
I think issues like this,
01:03:57.130 --> 01:04:01.150
and also, for Woody's perspective,
01:04:01.150 --> 01:04:02.800
because there's peak.
01:04:02.800 --> 01:04:05.746
And now, we have to think about shoulder, you know,
01:04:05.746 --> 01:04:08.360
those seasonal outages
01:04:08.360 --> 01:04:10.653
and his ability, because again,
01:04:12.140 --> 01:04:13.430
for the purposes of the general public,
01:04:13.430 --> 01:04:15.310
'cause we're also educating them with these workshops.
01:04:15.310 --> 01:04:16.143
Good deal.
01:04:17.640 --> 01:04:21.477
Woody, explain, again, the letter of the law
01:04:21.477 --> 01:04:24.340
and your ability to coordinate those outages.
01:04:24.340 --> 01:04:27.140
Re-amplify that, those planned outages.
01:04:27.140 --> 01:04:29.180
Because again, I believe the generators,
01:04:29.180 --> 01:04:30.250
with all these forced outages
01:04:30.250 --> 01:04:32.240
and argument may be made
01:04:32.240 --> 01:04:35.490
that we haven't been able to take planned outages.
01:04:35.490 --> 01:04:36.323
It's tight.
01:04:36.323 --> 01:04:37.310
Sure.
Go ahead.
01:04:37.310 --> 01:04:40.990
So when we talk about generator outages,
01:04:40.990 --> 01:04:42.320
we're talking about when a generator,
01:04:42.320 --> 01:04:44.400
a generator outage is when they're offline,
01:04:44.400 --> 01:04:45.750
they're not running.
01:04:45.750 --> 01:04:48.860
So sometimes the generators are offline
01:04:48.860 --> 01:04:50.360
in order to work on the plants
01:04:50.360 --> 01:04:53.500
and they have planned overhauls, planned maintenance.
01:04:53.500 --> 01:04:54.980
And when those occur,
01:04:54.980 --> 01:04:59.980
if generators schedule those more than 45 days in advance,
01:05:00.330 --> 01:05:02.500
then we automatically accept them.
01:05:02.500 --> 01:05:04.260
That's the way the rules are written.
01:05:04.260 --> 01:05:07.230
If they ask for a planned outage
01:05:07.230 --> 01:05:08.950
or a planned maintenance outage
01:05:08.950 --> 01:05:11.330
with less than 45 days notice,
01:05:11.330 --> 01:05:13.050
then we look and make sure
01:05:13.050 --> 01:05:15.120
they're not going to cause a reliability issue
01:05:15.120 --> 01:05:17.580
and make sure we're not having too many on one day
01:05:17.580 --> 01:05:19.450
or anything like that.
01:05:19.450 --> 01:05:20.790
And so we approve those
01:05:20.790 --> 01:05:22.790
and we may call them back and say, sorry,
01:05:22.790 --> 01:05:24.790
it looks like it's too tight on the day you're asking.
01:05:24.790 --> 01:05:25.920
You need to wait three days
01:05:25.920 --> 01:05:26.753
and then you can start.
01:05:26.753 --> 01:05:28.380
'cause these other guys are going to be back.
01:05:28.380 --> 01:05:30.600
So we coordinate that stuff within 45 days.
01:05:30.600 --> 01:05:32.530
More than 45 days,
01:05:32.530 --> 01:05:35.150
we don't have any control over that.
01:05:35.150 --> 01:05:37.400
We take what they ask for.
01:05:37.400 --> 01:05:40.453
So is that something that we need to reconsider?
01:05:42.970 --> 01:05:44.650
I think it's worked okay.
01:05:46.030 --> 01:05:46.863
Most of the time,
01:05:46.863 --> 01:05:49.760
these plants are giving us notices of their outages
01:05:49.760 --> 01:05:52.840
well in advance, sometimes six months or a year in advance
01:05:52.840 --> 01:05:54.800
and we can fit everything else around the people
01:05:54.800 --> 01:05:56.600
that get their outages in early.
01:05:56.600 --> 01:05:59.970
So the 45 day notice is actually not a bad compromise there,
01:05:59.970 --> 01:06:02.750
that we have been able to make that work.
01:06:02.750 --> 01:06:07.360
So within 45 days, having that control has been useful.
01:06:07.360 --> 01:06:11.570
That was a change that was made after the 2011 FERC report.
01:06:11.570 --> 01:06:12.963
We implemented that.
01:06:14.230 --> 01:06:16.030
The bigger problem here recently though,
01:06:16.030 --> 01:06:18.630
has been forced outages.
Yeah.
01:06:18.630 --> 01:06:21.900
I've heard several radio shows
01:06:24.466 --> 01:06:26.600
and read some articles where people have asked,
01:06:26.600 --> 01:06:31.410
why would EROCT allow that many outages on a particular day?
01:06:31.410 --> 01:06:33.513
And people who are interested to understand,
01:06:33.513 --> 01:06:36.760
those are mechanical failures that are occurring.
01:06:36.760 --> 01:06:38.420
Those are not planned outages.
01:06:38.420 --> 01:06:40.670
Those are units that we expect to be there,
01:06:40.670 --> 01:06:41.503
until they're not.
01:06:41.503 --> 01:06:42.620
And then all of a sudden they're out.
01:06:42.620 --> 01:06:44.530
That's an important point
01:06:44.530 --> 01:06:46.630
but the bottom line is still the same.
01:06:46.630 --> 01:06:50.243
The impact on the grid and on Texans is still the same.
01:06:51.620 --> 01:06:53.420
And I think that's something we need to look into.
01:06:53.420 --> 01:06:57.197
I know we had a lot of ERCOT and the PUC,
01:06:57.197 --> 01:07:00.300
had a lot of conversations with the broader public this week
01:07:00.300 --> 01:07:02.770
about exactly what you're saying.
01:07:02.770 --> 01:07:04.450
What caused those outages
01:07:05.660 --> 01:07:07.550
or the mechanical failures?
01:07:07.550 --> 01:07:10.280
Why was all this machinery breaking at the same time?
01:07:10.280 --> 01:07:12.079
Because it put us in a tight spot.
01:07:12.079 --> 01:07:13.180
That's right.
01:07:13.180 --> 01:07:14.880
And we're still in a tight spot.
01:07:17.550 --> 01:07:18.760
And I understand there's
01:07:20.950 --> 01:07:24.250
an existing rule in the ERCOT protocols
01:07:24.250 --> 01:07:28.080
that prohibits identifying who was generating,
01:07:28.080 --> 01:07:30.203
who wasn't generating for 60 days.
01:07:30.203 --> 01:07:31.447
That's correct.
Is that accurate?
01:07:31.447 --> 01:07:32.280
That accurate.
01:07:32.280 --> 01:07:33.237
We got that question a lot this week
01:07:33.237 --> 01:07:35.173
and I know y'all did, too.
Right.
01:07:37.180 --> 01:07:39.463
And I know there are market considerations,
01:07:41.390 --> 01:07:45.453
but I think it's worth considering waiving that rule.
01:07:46.920 --> 01:07:49.300
Having the Commission waive that rule
01:07:49.300 --> 01:07:50.920
given the circumstances
01:07:50.920 --> 01:07:52.990
and given the challenges
01:07:52.990 --> 01:07:55.420
we know we're going to be facing this summer
01:07:55.420 --> 01:07:59.623
so we can see, and the public can see,
01:07:59.623 --> 01:08:02.260
what generators were operating,
01:08:02.260 --> 01:08:03.510
when they were operating.
01:08:05.560 --> 01:08:07.740
And we can get better visibility
01:08:07.740 --> 01:08:09.540
into solving some of those problems.
01:08:09.540 --> 01:08:11.660
So I thought about that.
01:08:11.660 --> 01:08:14.833
And I think it needs to be looked at.
01:08:15.840 --> 01:08:18.460
So from the policy,
01:08:18.460 --> 01:08:23.370
I know that competitive and confidential information
01:08:23.370 --> 01:08:26.623
is an important nuance to the ERCOT marketplace.
01:08:28.270 --> 01:08:29.770
I mean, by definition,
01:08:29.770 --> 01:08:31.780
we are a competitive marketplace
01:08:31.780 --> 01:08:36.410
and thus, everybody is trying to use any advantage they can
01:08:36.410 --> 01:08:37.510
for their shareholders
01:08:40.220 --> 01:08:41.580
in that environment...
01:08:44.667 --> 01:08:46.870
I think it's safe to say the world has changed
01:08:46.870 --> 01:08:48.330
somewhat over the last three,
01:08:48.330 --> 01:08:50.700
well, certainly since 2018,
01:08:50.700 --> 01:08:54.860
since the 10,000 megawatts of coal generation retired,
01:08:54.860 --> 01:08:58.330
that base load capacity is no longer there.
01:08:58.330 --> 01:09:00.850
We're in a paradigm, it seems,
01:09:00.850 --> 01:09:03.620
to where it's just a tighter system than it was.
01:09:03.620 --> 01:09:07.090
And with the degree of intermittency
01:09:07.090 --> 01:09:10.423
that Woody has to integrate,
01:09:12.370 --> 01:09:15.990
we depend on companies doing the right thing.
01:09:15.990 --> 01:09:18.410
And I believe they are doing the right thing.
01:09:18.410 --> 01:09:21.540
I believe ultimately their shareholders
01:09:24.480 --> 01:09:25.664
have an interest
01:09:25.664 --> 01:09:28.700
in maintaining those facilities.
01:09:28.700 --> 01:09:30.820
But there is a policy benefit
01:09:30.820 --> 01:09:34.340
that could be considered in transparency
01:09:34.340 --> 01:09:36.090
on when these things go down.
01:09:36.090 --> 01:09:39.050
I mean, you have an added interest
01:09:39.050 --> 01:09:40.360
in getting that thing back up
01:09:40.360 --> 01:09:41.800
or maintaining them to a degree
01:09:41.800 --> 01:09:43.110
where it's not going to go down.
01:09:43.110 --> 01:09:47.560
There are still, and I want both the public to understand
01:09:47.560 --> 01:09:49.750
and legislators to understand,
01:09:49.750 --> 01:09:51.850
when forced outages occur
01:09:51.850 --> 01:09:54.450
and depending on where that generator is
01:09:54.450 --> 01:09:56.020
in the bidding process,
01:09:56.020 --> 01:09:58.320
there are financial penalties that are incurred.
01:09:58.320 --> 01:10:00.400
I mean, that was highlighted during the winter event.
01:10:00.400 --> 01:10:02.960
I mean, significant financial penalties.
01:10:02.960 --> 01:10:04.690
Again, we were trying to cope
01:10:04.690 --> 01:10:07.200
with that all through the session.
01:10:07.200 --> 01:10:08.250
However...
01:10:10.960 --> 01:10:12.400
Peer pressure is a real deal
01:10:13.260 --> 01:10:17.760
and public eyes on these individual events
01:10:17.760 --> 01:10:19.810
may have a benefit for our purposes.
01:10:19.810 --> 01:10:21.863
So yeah, I think we should consider it.
01:10:23.207 --> 01:10:24.983
I certainly agree, obviously.
01:10:25.900 --> 01:10:28.210
And as it goes to the market manipulation,
01:10:28.210 --> 01:10:32.683
I know private companies report to their shareholders.
01:10:33.600 --> 01:10:36.373
And I know Carrie, we've discussed this a little bit.
01:10:38.110 --> 01:10:41.960
And there are very good reasons for preventing the,
01:10:41.960 --> 01:10:43.010
tremendously important reasons
01:10:43.010 --> 01:10:46.250
for preventing or minimizing market manipulation,
01:10:46.250 --> 01:10:48.800
but also in looking into this,
01:10:48.800 --> 01:10:51.610
have, I want to point out that
01:10:52.820 --> 01:10:55.200
a lot of this information has been
01:10:57.320 --> 01:11:00.410
gleaned out by private sector information companies.
01:11:00.410 --> 01:11:03.500
Right, there's an entire industry set up to dig,
01:11:03.500 --> 01:11:05.820
to ferret out these nuggets.
01:11:05.820 --> 01:11:08.380
Everything from watching smokestacks,
01:11:08.380 --> 01:11:09.610
paying people to watch smokestacks
01:11:09.610 --> 01:11:10.860
to see who's generating
01:11:10.860 --> 01:11:13.710
to running thermal infrared cameras along power lines
01:11:13.710 --> 01:11:16.070
to see where the power's flowing.
01:11:16.070 --> 01:11:16.903
So I think,
01:11:17.990 --> 01:11:20.990
in terms of the potential for more market manipulation
01:11:20.990 --> 01:11:23.213
and thus, a negative impact on customers,
01:11:25.210 --> 01:11:28.410
having this information in public
01:11:28.410 --> 01:11:31.200
has a minimal impact on the
01:11:32.050 --> 01:11:36.760
or almost no additional information would be made available
01:11:36.760 --> 01:11:38.463
to market participants.
01:11:39.900 --> 01:11:41.860
And a lot more information
01:11:41.860 --> 01:11:44.000
would be made to the general public,
01:11:44.000 --> 01:11:46.380
which is incredibly important.
01:11:46.380 --> 01:11:49.207
So this is not something we're gonna solve today.
01:11:49.207 --> 01:11:50.040
No, sir.
01:11:50.040 --> 01:11:50.873
But I think,
01:11:52.399 --> 01:11:53.710
it's something I'm gonna consider,
01:11:53.710 --> 01:11:56.700
continue to evaluate, and we'll probably follow a memo on
01:11:56.700 --> 01:11:57.900
before our next meeting.
01:12:01.450 --> 01:12:02.610
And look forward to discussing that with you
01:12:02.610 --> 01:12:04.400
at the next next meeting.
01:12:04.400 --> 01:12:05.633
I look forward to it.
01:12:08.690 --> 01:12:10.890
One more request
01:12:10.890 --> 01:12:13.130
on the data you mentioned related
01:12:13.130 --> 01:12:15.880
to the current operating plan,
01:12:15.880 --> 01:12:19.010
the look ahead to see what our forecast
01:12:19.010 --> 01:12:20.340
for thermal generation is.
01:12:20.340 --> 01:12:23.560
Would you have your team
01:12:23.560 --> 01:12:26.870
give us a list of what that data would look like
01:12:26.870 --> 01:12:28.630
in your perfect world,
01:12:28.630 --> 01:12:31.640
to get a better visibility beyond 18 to 24 hours?
01:12:31.640 --> 01:12:32.880
Okay, yes, certainly.
01:12:32.880 --> 01:12:33.820
We'd appreciate that.
01:12:33.820 --> 01:12:35.963
And we'll take a look at that, as well.
01:12:38.530 --> 01:12:39.720
Before we let you go,
01:12:39.720 --> 01:12:40.553
I would also
01:12:42.790 --> 01:12:45.063
like to hear your thoughts on,
01:12:45.950 --> 01:12:50.020
in what was a challenging week, for the grid,
01:12:50.020 --> 01:12:52.850
and challenging enough that we asked Texans
01:12:52.850 --> 01:12:54.473
to conserve what they could.
01:12:55.530 --> 01:12:59.170
How did ERCOT respond to this situation differently
01:12:59.170 --> 01:13:00.640
than it has in the past?
01:13:00.640 --> 01:13:04.090
Okay, so a couple of things that we did this week
01:13:04.090 --> 01:13:05.010
that we haven't done,
01:13:05.010 --> 01:13:06.460
and some of that was based on
01:13:07.320 --> 01:13:10.373
the number of forced outages that we saw on Sunday.
01:13:11.406 --> 01:13:14.010
That was more than what we have seen from thermal units
01:13:14.010 --> 01:13:17.480
in the past, on a day like that.
01:13:17.480 --> 01:13:18.940
And so all week, this week,
01:13:18.940 --> 01:13:20.680
Monday, Tuesday, Wednesday and even today,
01:13:20.680 --> 01:13:22.580
we have taken out of market actions
01:13:22.580 --> 01:13:24.440
to bring more generation online
01:13:24.440 --> 01:13:26.950
using the process we call RUC.
01:13:26.950 --> 01:13:28.330
So that RUC process,
01:13:28.330 --> 01:13:30.670
the reliability unit commitment,
01:13:30.670 --> 01:13:34.100
meaning we're looking across what the market has committed
01:13:34.100 --> 01:13:35.360
versus what the load is.
01:13:35.360 --> 01:13:37.708
And we don't think there's enough there.
01:13:37.708 --> 01:13:39.708
And so if we don't think there's enough,
01:13:41.250 --> 01:13:43.050
that's partly based on the fact
01:13:43.050 --> 01:13:45.290
that we saw as many forced outages
01:13:45.290 --> 01:13:47.100
as we did on that one day.
01:13:47.100 --> 01:13:49.620
And so we have committed generation
01:13:49.620 --> 01:13:51.300
to keep the grid
01:13:51.300 --> 01:13:54.563
in a state where,
01:13:57.037 --> 01:14:00.620
if those forced outages were to happen again,
01:14:00.620 --> 01:14:03.000
we would not be in a bind, basically.
01:14:03.000 --> 01:14:03.890
Right, so that's-
01:14:03.890 --> 01:14:06.600
We are more conservatively operating the system
01:14:06.600 --> 01:14:07.433
at this point,
01:14:07.433 --> 01:14:10.623
by making sure we have more reserves online all the time.
01:14:14.699 --> 01:14:15.660
To make sure I understand this right.
01:14:15.660 --> 01:14:18.220
So when you saw the challenges on Sunday
01:14:18.220 --> 01:14:21.230
that we were going to be facing, going into Monday,
01:14:21.230 --> 01:14:24.040
the decision was made to go,
01:14:24.040 --> 01:14:26.550
I guess, above and beyond the normal operating procedure
01:14:26.550 --> 01:14:30.090
of ERCOT to call all available generation in Texas?
01:14:30.090 --> 01:14:30.923
Yes.
01:14:30.923 --> 01:14:33.483
So we're gonna act with an abundance of caution.
01:14:34.410 --> 01:14:36.110
And at this moment in time,
01:14:36.110 --> 01:14:39.310
we're going to step out of the normal market operations
01:14:39.310 --> 01:14:41.840
and say, we're calling all generation
01:14:41.840 --> 01:14:44.260
to make sure we have that margin of safety.
01:14:44.260 --> 01:14:45.810
We're acting out of an abundance of caution
01:14:45.810 --> 01:14:48.970
to make sure that we have the stability we need in the grid?
01:14:48.970 --> 01:14:50.100
Is that fair?
01:14:50.100 --> 01:14:52.120
That's pretty much right,
01:14:52.120 --> 01:14:54.810
except for it wouldn't necessarily be all generation
01:14:54.810 --> 01:14:57.530
but it will be to a margin
01:14:57.530 --> 01:14:59.140
that's more than what we normally kept.
01:14:59.140 --> 01:15:03.120
So this rule that we're talking about could apply
01:15:03.120 --> 01:15:04.810
to any day, even an off-peak day,
01:15:04.810 --> 01:15:08.290
if we don't think that there is enough reserve
01:15:08.290 --> 01:15:09.920
on the system, on online,
01:15:09.920 --> 01:15:13.200
then we're going to RUC to get there.
01:15:13.200 --> 01:15:14.714
And so it might not be every unit.
01:15:14.714 --> 01:15:16.700
We might not be bringing every unit on it.
01:15:16.700 --> 01:15:17.533
Earlier this week,
01:15:17.533 --> 01:15:18.970
it has been every unit.
Okay.
01:15:18.970 --> 01:15:21.240
But if it was a 65,000 megawatt day,
01:15:21.240 --> 01:15:23.530
it might not be every unit.
Sure.
01:15:23.530 --> 01:15:25.840
And this is gonna vary a lot with the wind
01:15:25.840 --> 01:15:28.100
and the solar output and the forecast that we expect.
01:15:28.100 --> 01:15:30.870
So if we have high wind and high days,
01:15:30.870 --> 01:15:32.010
where we have a lot of generation
01:15:32.010 --> 01:15:34.060
from those types of resources,
01:15:34.060 --> 01:15:36.960
it won't be as critical to RUC those units.
01:15:36.960 --> 01:15:39.660
Okay, well, I think it's important to highlight that
01:15:41.370 --> 01:15:42.850
y'all went above and beyond
01:15:42.850 --> 01:15:45.150
normal kind of standard procedure
01:15:46.740 --> 01:15:48.863
when you saw this challenge on Sunday,
01:15:49.720 --> 01:15:51.913
went ahead and called all of that generation on,
01:15:51.913 --> 01:15:53.660
and in out of market action,
01:15:53.660 --> 01:15:55.890
to make sure that going into Monday,
01:15:55.890 --> 01:15:57.113
a challenging Monday,
01:15:58.240 --> 01:16:00.943
Texas had all the power it needed.
01:16:01.935 --> 01:16:04.080
I think that's incredibly important.
01:16:04.080 --> 01:16:06.250
And that'll be our procedure going forward.
01:16:06.250 --> 01:16:07.550
An abundance of caution.
01:16:08.400 --> 01:16:10.320
Thank you for walking us through that.
01:16:10.320 --> 01:16:12.330
And I think that's something to highlight
01:16:12.330 --> 01:16:14.050
and thank you for your work on that.
01:16:14.050 --> 01:16:15.933
So while I have Woody here,
01:16:17.150 --> 01:16:19.160
I'd like to highlight one fact
01:16:19.160 --> 01:16:22.260
and he can verify from the ERCOT perspective,
01:16:22.260 --> 01:16:25.010
tools that we have in the toolbox, but for the public,
01:16:25.010 --> 01:16:28.280
in terms of what ERCOT faced this week,
01:16:28.280 --> 01:16:32.270
did we only set one record or two, successively?
01:16:32.270 --> 01:16:34.690
We may have set a new weekend record, as well.
01:16:34.690 --> 01:16:36.010
Exactly, yeah.
01:16:36.010 --> 01:16:37.440
I mean, bottom line is
01:16:37.440 --> 01:16:41.903
this was a high-load period in the history of the system.
01:16:42.810 --> 01:16:44.450
It was hot.
01:16:44.450 --> 01:16:46.940
The economy of Texas is kind of coming back.
01:16:46.940 --> 01:16:49.793
We're starting to see, it's different than 2020.
01:16:50.680 --> 01:16:53.790
COVID had its impacts on load.
01:16:53.790 --> 01:16:56.920
Now you're starting to see new growth phenomenons
01:16:56.920 --> 01:16:57.753
become apparent.
01:16:57.753 --> 01:16:58.743
Is that accurate?
01:16:58.743 --> 01:16:59.790
That is very accurate, yes.
01:16:59.790 --> 01:17:01.230
All right.
01:17:01.230 --> 01:17:02.710
And then it combined
01:17:02.710 --> 01:17:07.710
with a high-variability period for intermittent resources,
01:17:09.230 --> 01:17:11.000
then combined with forced outages.
01:17:11.000 --> 01:17:13.300
So to put it in context for everybody,
01:17:13.300 --> 01:17:15.970
there were body blows being dealt to the grid
01:17:15.970 --> 01:17:18.640
and our systems still maintained
01:17:19.680 --> 01:17:23.840
with only a conservation advisory notice going out,
01:17:23.840 --> 01:17:26.310
not an alert, which is an important nuance.
01:17:26.310 --> 01:17:27.870
And I know we're going to take great pains
01:17:27.870 --> 01:17:30.000
over the summer to delineate
01:17:30.000 --> 01:17:32.270
between advisory and alert
01:17:32.270 --> 01:17:35.023
which I know folks are scared, after February.
01:17:36.530 --> 01:17:37.910
To put it in perspective
01:17:37.910 --> 01:17:41.810
and to kind of frame this for legislators
01:17:42.720 --> 01:17:45.563
and the government in general and the public,
01:17:46.740 --> 01:17:48.260
there has been a policy in Texas
01:17:48.260 --> 01:17:53.260
to try to find a Texas way for a long time,
01:17:53.470 --> 01:17:54.600
for 30 years,
01:17:54.600 --> 01:17:59.600
on integration of intermittent resources, to a large degree,
01:17:59.670 --> 01:18:04.670
married up with thermal generation so that hopefully,
01:18:05.160 --> 01:18:09.200
they worked together to provide reliability and low prices,
01:18:09.200 --> 01:18:11.630
to try to make those two competing forces,
01:18:11.630 --> 01:18:13.680
possibly competing forces, work together.
01:18:14.810 --> 01:18:19.700
Other ISO's around the country have also attempted this
01:18:19.700 --> 01:18:21.283
and are attempting this.
01:18:22.230 --> 01:18:23.550
Case in point,
01:18:23.550 --> 01:18:27.230
to put it in perspective on conservation capabilities,
01:18:27.230 --> 01:18:28.710
the California ISO
01:18:29.990 --> 01:18:34.270
has a large amount of intermittent resource penetration
01:18:34.270 --> 01:18:35.103
in that market.
01:18:35.103 --> 01:18:36.640
Matter of fact, they have a lot of policies designed
01:18:36.640 --> 01:18:37.653
to enhance that,
01:18:38.830 --> 01:18:41.440
with policy goals at the end of that.
01:18:41.440 --> 01:18:44.650
And from the last kind of call
01:18:44.650 --> 01:18:46.650
where I was briefed on what they're doing,
01:18:46.650 --> 01:18:49.990
they are trying to develop over eight gigawatts
01:18:49.990 --> 01:18:54.560
of load resource management programs which,
01:18:54.560 --> 01:18:55.660
that's conservation.
01:18:55.660 --> 01:18:58.320
I mean, they are telling consumers to pull back
01:18:58.320 --> 01:19:03.200
in order to marry up the system reliability
01:19:03.200 --> 01:19:05.577
to the policy goals
01:19:05.577 --> 01:19:07.800
that they have adopted.
01:19:07.800 --> 01:19:09.750
And so my point there,
01:19:09.750 --> 01:19:11.810
is this is a common practice
01:19:11.810 --> 01:19:13.830
and for the people of Texas,
01:19:13.830 --> 01:19:17.130
when you want carbon neutrality,
01:19:17.130 --> 01:19:20.150
when you want these new technologies to come in,
01:19:20.150 --> 01:19:21.440
we have to keep that in mind
01:19:21.440 --> 01:19:24.420
that all these things have to act together.
01:19:24.420 --> 01:19:27.240
And again, it's not ERCOT telling people
01:19:27.240 --> 01:19:29.120
the system is unreliable.
01:19:29.120 --> 01:19:32.110
It's simply, making all this work in tandem
01:19:32.110 --> 01:19:34.910
to where the system is maintained
01:19:34.910 --> 01:19:38.990
and the greater public good is attained.
01:19:38.990 --> 01:19:40.050
And that's my soap box.
01:19:40.050 --> 01:19:43.420
But when we were called back over,
01:19:43.420 --> 01:19:45.920
that's what's being attempted to be achieved here.
01:19:48.980 --> 01:19:50.670
Well put.
Okay.
01:19:50.670 --> 01:19:51.820
It's a big challenge.
01:19:52.670 --> 01:19:53.970
It's a very big challenge.
01:19:55.300 --> 01:19:57.373
One last question and we'll let you go.
01:19:58.885 --> 01:20:01.200
When you said this'll be talking about
01:20:01.200 --> 01:20:03.603
the new policy going forward into the summer,
01:20:04.820 --> 01:20:06.023
taking a new approach,
01:20:07.000 --> 01:20:08.260
I think this applies to both,
01:20:08.260 --> 01:20:11.180
especially to ancillary services, but to RUCing, as well.
01:20:11.180 --> 01:20:15.360
So getting, bringing more generation online
01:20:15.360 --> 01:20:17.683
as a margin of safety before you need it.
01:20:19.840 --> 01:20:21.340
I know we've talked about this
01:20:22.310 --> 01:20:26.180
but I want to highlight what that new approach looks like
01:20:26.180 --> 01:20:27.330
in terms of
01:20:29.488 --> 01:20:32.550
when you establish how much generation you need to have
01:20:32.550 --> 01:20:33.963
for that margin of safety.
01:20:35.080 --> 01:20:40.080
In the past, it's been a preset formulaic number
01:20:40.090 --> 01:20:41.860
based on a lot of variables,
01:20:41.860 --> 01:20:45.080
historic demand and things like that.
01:20:45.080 --> 01:20:48.800
Now, from what I understand, you're not only,
01:20:48.800 --> 01:20:50.620
you're still using that tool,
01:20:50.620 --> 01:20:53.510
but you're also bringing in
01:20:53.510 --> 01:20:57.160
a much more updated evaluation of real-time conditions
01:20:57.160 --> 01:21:01.200
as you look to make sure going into the next day
01:21:01.200 --> 01:21:02.080
and the next day after that.
01:21:02.080 --> 01:21:05.110
You're looking to make sure that real-time conditions
01:21:05.110 --> 01:21:06.710
are being accounted for much more so
01:21:06.710 --> 01:21:08.230
than they have in the past.
01:21:08.230 --> 01:21:09.610
Is that accurate?
That's right.
01:21:09.610 --> 01:21:13.170
That's an incredibly important point,
01:21:13.170 --> 01:21:15.077
I want to make sure the public is aware of.
01:21:15.077 --> 01:21:16.990
And I know that's a big departure
01:21:16.990 --> 01:21:18.980
from the standard operations
01:21:18.980 --> 01:21:22.440
that y'all have been using in the past.
01:21:22.440 --> 01:21:24.150
And I want to thank you for making that change.
01:21:24.150 --> 01:21:25.380
That's incredibly important.
01:21:25.380 --> 01:21:28.240
I know that's operationally different
01:21:28.240 --> 01:21:30.270
and it's a challenge to implement things like that
01:21:30.270 --> 01:21:31.950
but that's incredibly important
01:21:31.950 --> 01:21:33.480
and it will serve Texas well this summer.
01:21:33.480 --> 01:21:35.030
Yeah, well, as our grid changes,
01:21:35.030 --> 01:21:37.970
we need to be able to change our procedures
01:21:37.970 --> 01:21:39.420
and our processes and our tools
01:21:39.420 --> 01:21:41.420
and even the training of our people
01:21:41.420 --> 01:21:43.930
in order to meet the new demands of a grid
01:21:43.930 --> 01:21:47.020
that doesn't look like the grid we had 15 years ago.
01:21:47.020 --> 01:21:48.930
And so it makes sense that we're gonna
01:21:48.930 --> 01:21:52.963
make some changes to operate that new grid.
01:21:54.160 --> 01:21:55.560
Absolutely.
01:21:55.560 --> 01:21:57.230
Anything else?
No, sir.
01:21:57.230 --> 01:21:58.309
Woody, thank you very much.
01:21:58.309 --> 01:21:59.142
Thank you.
01:21:59.142 --> 01:22:00.050
Appreciate your work this week.
01:22:02.760 --> 01:22:03.683
At this point,
01:22:04.670 --> 01:22:06.587
let's call up Warren Lasher.
01:22:16.670 --> 01:22:18.320
Good morning, Chairman, Commissioner.
01:22:18.320 --> 01:22:19.153
Warren Lasher
01:22:19.153 --> 01:22:21.840
for the Electric Reliability Council of Texas.
01:22:21.840 --> 01:22:22.673
Good to see you, Warren.
01:22:22.673 --> 01:22:23.506
Thank you for being here.
01:22:23.506 --> 01:22:25.440
Good to be here, thank you.
01:22:25.440 --> 01:22:28.010
I know we've all, going into the summer,
01:22:28.010 --> 01:22:29.180
y'all have done a lot,
01:22:29.180 --> 01:22:32.650
always do a lot of work on the CDR on the SARA,
01:22:32.650 --> 01:22:33.550
which is,
Sure.
01:22:34.677 --> 01:22:35.510
A look ahead
01:22:35.510 --> 01:22:38.400
to how much electricity is going to be needed,
01:22:38.400 --> 01:22:39.970
how much electricity we're going to have
01:22:39.970 --> 01:22:44.273
and all of the moving pieces that go into figuring that out.
01:22:46.460 --> 01:22:47.930
Could you give us a quick overview?
01:22:47.930 --> 01:22:50.710
And we heard a lot about
01:22:50.710 --> 01:22:54.453
the confluence of factors we experienced this week.
01:22:57.434 --> 01:22:58.410
A lot of mechanical failure,
01:22:58.410 --> 01:23:00.433
unexpected outages of generation,
01:23:01.310 --> 01:23:04.180
record-setting demand for electricity in June
01:23:04.180 --> 01:23:05.700
we hadn't seen before
01:23:05.700 --> 01:23:10.700
and then less wind output than we had expected.
01:23:11.010 --> 01:23:13.080
And wind is variable.
01:23:13.080 --> 01:23:15.200
That's the nature of that business.
01:23:15.200 --> 01:23:16.620
That's something we're aware of.
01:23:16.620 --> 01:23:19.143
And I know y'all work very hard to accommodate.
01:23:20.940 --> 01:23:24.110
I think it's fair to say that the convergence
01:23:24.110 --> 01:23:27.400
of those three things at the same time
01:23:29.300 --> 01:23:31.830
are what got us to a pretty tight spot.
01:23:31.830 --> 01:23:32.663
Is that accurate?
01:23:32.663 --> 01:23:33.950
That's correct.
01:23:33.950 --> 01:23:38.260
Can you give us a quick overview on how y'all's analysis,
01:23:38.260 --> 01:23:40.940
how y'all look at the forecast that we've heard about
01:23:40.940 --> 01:23:42.830
and I know Woody touched on it
01:23:42.830 --> 01:23:43.780
but just give us a quick overview
01:23:43.780 --> 01:23:46.130
of how y'all approach those forecasts.
01:23:46.130 --> 01:23:48.590
Sure, let me take a brief step back.
01:23:48.590 --> 01:23:51.820
We mentioned the capacity demand reserves report
01:23:51.820 --> 01:23:53.360
and the seasonal assessments
01:23:53.360 --> 01:23:55.640
of the capacity demand reserves report
01:23:55.640 --> 01:23:57.420
is a long-term view.
01:23:57.420 --> 01:24:01.093
It's meant to allow the calculation of a reserve margin,
01:24:01.970 --> 01:24:06.970
the amount of capacity above our expected usage
01:24:07.260 --> 01:24:09.563
in the hottest days of summer.
01:24:09.563 --> 01:24:14.563
And that allows us to track how reserves change over time.
01:24:14.700 --> 01:24:16.450
It's a longer term view.
01:24:16.450 --> 01:24:19.810
It's based on kind of average conditions.
01:24:19.810 --> 01:24:22.050
There are specific assumptions in both
01:24:22.050 --> 01:24:23.920
the capacity demand reserves report
01:24:23.920 --> 01:24:25.350
and in the seasonal assessment
01:24:25.350 --> 01:24:28.900
regarding the amount of wind that we would expect
01:24:28.900 --> 01:24:30.660
on any given peak day
01:24:30.660 --> 01:24:33.820
based on historical performance of those resources
01:24:33.820 --> 01:24:35.400
and the same for solar,
01:24:35.400 --> 01:24:39.410
the same for large industrial customers
01:24:39.410 --> 01:24:42.350
who have excess energy that they can sell to the market.
01:24:42.350 --> 01:24:43.973
We look at historical data.
01:24:44.890 --> 01:24:46.600
The same for,
01:24:46.600 --> 01:24:50.360
we have some asynchronous or DC ties
01:24:50.360 --> 01:24:52.520
that connect us to other regions
01:24:52.520 --> 01:24:53.830
where there's a limited amount
01:24:53.830 --> 01:24:55.890
of import and export capability.
01:24:55.890 --> 01:24:58.740
We look at historical data to inform us
01:24:58.740 --> 01:25:01.130
on what the expected capacity
01:25:01.130 --> 01:25:03.000
on usage of those units might be.
01:25:03.000 --> 01:25:05.520
So the capacity demand reserves report
01:25:05.520 --> 01:25:08.130
looks out over a long-term.
01:25:08.130 --> 01:25:09.760
About 10 years ago,
01:25:09.760 --> 01:25:12.200
we started producing the seasonal assessment
01:25:12.200 --> 01:25:16.540
which really looks, focuses on the next two upcoming seasons
01:25:16.540 --> 01:25:20.280
and allows us to look more at scenarios of,
01:25:20.280 --> 01:25:21.610
well, what if this happens?
01:25:21.610 --> 01:25:22.760
What if that happens?
01:25:22.760 --> 01:25:24.050
And for the most part,
01:25:24.050 --> 01:25:28.070
those scenarios are based on, again, historical occurrences.
01:25:28.070 --> 01:25:29.233
What have we seen?
01:25:30.435 --> 01:25:32.840
So going into this summer,
01:25:32.840 --> 01:25:35.700
the seasonal assessment looked at what our expectation
01:25:35.700 --> 01:25:37.500
for the peak day was,
01:25:37.500 --> 01:25:40.630
given our expectation for peak customer demand
01:25:40.630 --> 01:25:42.240
on the hottest days of summer.
01:25:42.240 --> 01:25:45.490
And again, the amount of wind that we would expect to see,
01:25:45.490 --> 01:25:47.740
the amount of solar we would expect to see, et cetera,
01:25:47.740 --> 01:25:51.403
based on historical data during peak events.
01:25:52.300 --> 01:25:55.640
There were three other scenarios, primary scenarios,
01:25:55.640 --> 01:25:57.340
the first of which was, well,
01:25:57.340 --> 01:26:01.410
what if we have increased number of forced outages,
01:26:01.410 --> 01:26:05.320
these unexpected, unplanned outages on units?
01:26:05.320 --> 01:26:07.720
So that was one of the scenarios that we showed.
01:26:08.650 --> 01:26:11.090
The next scenario was, well,
01:26:11.090 --> 01:26:14.010
what if we have a really hot summer?
01:26:14.010 --> 01:26:15.950
So if you look back, the most recent,
01:26:15.950 --> 01:26:18.300
very hot summer was 2011.
01:26:18.300 --> 01:26:20.120
It happens to be one of the hottest summers
01:26:20.120 --> 01:26:21.620
experienced in Texas.
01:26:21.620 --> 01:26:25.190
And so the third scenario on that primary scenario page
01:26:25.190 --> 01:26:29.460
was what if we have another 2011 type summer?
01:26:29.460 --> 01:26:32.730
What will peak customer demand on those hottest days be?
01:26:32.730 --> 01:26:34.070
That was the third scenario.
01:26:34.070 --> 01:26:36.540
And how much reserves would we expect to have?
01:26:36.540 --> 01:26:38.690
And then the fourth scenario was, well,
01:26:38.690 --> 01:26:41.270
what if we have very low wind conditions
01:26:41.270 --> 01:26:43.460
on a peak like summer day?
01:26:43.460 --> 01:26:47.477
And so basically, we separated those conditions into-
01:26:47.477 --> 01:26:48.330
What was the second one?
Yeah.
01:26:48.330 --> 01:26:49.600
You did, one, three and four.
01:26:49.600 --> 01:26:52.170
No, so the first one is kind of our expectation.
01:26:52.170 --> 01:26:53.610
Okay, base case?
The base case.
01:26:53.610 --> 01:26:57.870
The second one was increased unexpected outages.
01:26:57.870 --> 01:27:00.470
The third was, and now I'm forgetting myself.
01:27:00.470 --> 01:27:02.513
The third was a very hot summer.
01:27:02.513 --> 01:27:03.680
A 2011 type summer.
01:27:03.680 --> 01:27:06.280
And then the fourth was very low wind conditions.
01:27:06.280 --> 01:27:07.440
And I should note,
01:27:07.440 --> 01:27:10.920
it was that fourth scenario was the only scenario
01:27:10.920 --> 01:27:13.950
that indicated the potential for having to go
01:27:13.950 --> 01:27:18.800
into emergency conditions due to very low wind conditions.
01:27:18.800 --> 01:27:22.840
And the wind conditions in that fourth scenario
01:27:22.840 --> 01:27:26.160
were consistent with what we saw earlier this week.
01:27:26.160 --> 01:27:28.997
So we really did see that.
01:27:28.997 --> 01:27:33.997
And the unexpected, unplanned outage scenario, again,
01:27:35.100 --> 01:27:38.100
relatively consistent with what we saw earlier this week.
01:27:38.100 --> 01:27:39.090
I think earlier this week,
01:27:39.090 --> 01:27:43.520
we actually saw higher levels of unexpected outages.
01:27:43.520 --> 01:27:47.300
So unfortunately, we saw both of those on the same day.
01:27:47.300 --> 01:27:49.740
Two worst case scenarios happened at the same time.
01:27:49.740 --> 01:27:50.600
Absolutely, correct.
01:27:50.600 --> 01:27:52.053
And both of those are,
01:27:53.040 --> 01:27:55.860
statistically looking at historical data,
01:27:55.860 --> 01:27:58.900
both of those are one in 20 type events.
01:27:58.900 --> 01:28:01.980
So like a 95th percentile event.
01:28:01.980 --> 01:28:04.310
So, you know, they are unlikely,
01:28:04.310 --> 01:28:08.410
they would be unlikely to occur at the same time.
01:28:08.410 --> 01:28:11.370
I think to some extent though, you know,
01:28:11.370 --> 01:28:12.560
part of what we're seeing
01:28:12.560 --> 01:28:16.520
is we're seeing an early June type event.
01:28:16.520 --> 01:28:17.973
So, you know, it's a,
01:28:21.040 --> 01:28:24.370
the seasonal assessments look across the whole season.
01:28:24.370 --> 01:28:26.500
And so, you know, the focus,
01:28:26.500 --> 01:28:28.760
I will say the focus of the seasonal assessment
01:28:28.760 --> 01:28:32.700
is really July, August, and July, August type conditions.
01:28:32.700 --> 01:28:34.850
And, you know, we're in a position
01:28:34.850 --> 01:28:37.790
where we're still learning as we go
01:28:37.790 --> 01:28:39.480
with some of these new resources,
01:28:39.480 --> 01:28:41.913
especially solar, but even wind.
01:28:42.850 --> 01:28:46.810
You know, we have a certain amount of historical data
01:28:46.810 --> 01:28:49.550
on wind, but it's still fairly limited.
01:28:49.550 --> 01:28:52.680
And there may be situations where it becomes clearer
01:28:52.680 --> 01:28:55.480
over time, that in June,
01:28:55.480 --> 01:28:57.190
the weather conditions are just different
01:28:57.190 --> 01:29:00.260
from how they are later in the summer season.
01:29:00.260 --> 01:29:03.820
One of the, you know, one of the issues that we have seen
01:29:03.820 --> 01:29:05.200
in recent years
01:29:05.200 --> 01:29:09.080
is when we have very hot summer events,
01:29:09.080 --> 01:29:10.920
especially over Dallas,
01:29:10.920 --> 01:29:13.740
that weather pattern sitting over Dallas
01:29:13.740 --> 01:29:16.460
tends to extend to a certain amount
01:29:16.460 --> 01:29:17.670
out to about Abilene.
01:29:17.670 --> 01:29:19.970
But then when you get out into the panhandle,
01:29:19.970 --> 01:29:23.190
that hot weather in Dallas actually draws wind
01:29:23.190 --> 01:29:25.970
across the panhandle in certain weather conditions.
01:29:25.970 --> 01:29:28.430
And so what we have seen is a correlation
01:29:28.430 --> 01:29:32.670
between very hot, at the urban centers,
01:29:32.670 --> 01:29:34.210
around Dallas and Houston,
01:29:34.210 --> 01:29:36.770
and then wind through the panhandle
01:29:36.770 --> 01:29:38.940
where we have a lot of wind resources.
01:29:38.940 --> 01:29:41.950
That may not be something that we tend to see in June.
01:29:41.950 --> 01:29:43.600
We just don't have enough data.
01:29:43.600 --> 01:29:47.040
So, what is that correlation?
01:29:47.040 --> 01:29:49.640
I don't have a name for it, but it's just a-
01:29:49.640 --> 01:29:51.500
I mean, what's the level of correlation?
01:29:51.500 --> 01:29:52.477
Do we know?
01:29:52.477 --> 01:29:53.310
Is is like 0.2?
01:29:53.310 --> 01:29:55.070
No, no, I don't know what the level of correlation is
01:29:55.070 --> 01:29:57.520
but it's something that we see routinely,
01:29:57.520 --> 01:29:58.650
in the July, August timeframe.
01:29:58.650 --> 01:30:00.213
Is that correlation,
01:30:01.950 --> 01:30:04.160
is that correlation taken into account
01:30:04.160 --> 01:30:07.760
in real time evaluation looking forward?
01:30:07.760 --> 01:30:09.730
So like, if you're looking ahead, if you're-
01:30:09.730 --> 01:30:11.090
It would be,
01:30:11.090 --> 01:30:12.600
the way that would take effect
01:30:12.600 --> 01:30:16.010
in terms of the near term outlook would be
01:30:16.010 --> 01:30:19.500
our meteorological analysis over the next seven days,
01:30:19.500 --> 01:30:23.010
that meteorological analysis drives the wind forecast
01:30:23.010 --> 01:30:24.080
for the seven days.
01:30:24.080 --> 01:30:27.487
It also drives the customer demand forecast for seven days.
01:30:27.487 --> 01:30:29.727
So, it also drives the solar forecast for seven days.
01:30:29.727 --> 01:30:32.881
And so that correlation would show up
01:30:32.881 --> 01:30:37.810
in the near term forecast that we have for those resources.
01:30:37.810 --> 01:30:39.780
And then the correlation would also show up,
01:30:39.780 --> 01:30:44.780
as we look back, we would see that on very high demand days
01:30:45.150 --> 01:30:47.010
when it's hot in Dallas,
01:30:47.010 --> 01:30:49.890
there's also a significant amount of wind
01:30:50.760 --> 01:30:52.150
coming off of these resources.
01:30:52.150 --> 01:30:54.780
So it would show up in the hindsight look
01:30:54.780 --> 01:30:56.883
and in the forecaster look.
01:30:56.883 --> 01:30:59.240
So, you're saying, it shows up in the data points,
01:30:59.240 --> 01:31:03.253
not necessarily, but is there any point in this,
01:31:04.240 --> 01:31:05.460
the forward looking analysis
01:31:05.460 --> 01:31:07.140
is what is most important, right,
01:31:07.140 --> 01:31:09.520
so we can prepare for the conditions
01:31:09.520 --> 01:31:11.750
to operate the grid in.
Correct.
01:31:11.750 --> 01:31:13.083
Is there, you know,
01:31:14.350 --> 01:31:17.060
call it the metroplex panhandle spread
01:31:17.060 --> 01:31:19.290
or whatever phenomena you want to call it.
01:31:19.290 --> 01:31:21.340
Is there any point in the forward-looking
01:31:22.670 --> 01:31:26.520
predictions of load, of wind, et cetera,
01:31:26.520 --> 01:31:28.770
where y'all's analysis
01:31:29.630 --> 01:31:31.990
or someone on your team kind of raises their hand and say,
01:31:31.990 --> 01:31:35.610
hey, the metroplex panhandle spread's in place.
01:31:35.610 --> 01:31:37.860
Let's adjust course or is it just a,
01:31:37.860 --> 01:31:41.120
it shows up in the data kind of, retroactively?
01:31:41.120 --> 01:31:42.520
Well, it does show up
01:31:42.520 --> 01:31:45.180
in the numbers of the forecast itself
01:31:45.180 --> 01:31:46.510
but our meteorologist
01:31:47.890 --> 01:31:49.920
pays a specific amount of attention to that.
01:31:49.920 --> 01:31:52.220
He really, and specifically,
01:31:52.220 --> 01:31:53.760
our meteorologist is kind of looking
01:31:53.760 --> 01:31:54.700
at it the other direction.
01:31:54.700 --> 01:31:57.210
Our meteorologist is very focused on
01:31:57.210 --> 01:32:00.270
days where he feels like the demand is gonna be high,
01:32:00.270 --> 01:32:01.610
wind is going to be low,
01:32:01.610 --> 01:32:04.390
and solar may be low, as well.
01:32:04.390 --> 01:32:06.940
So he has been focusing on that for some time.
01:32:06.940 --> 01:32:09.560
And he's also very focused to another level,
01:32:09.560 --> 01:32:13.040
he's focused on situations where he feels like
01:32:13.040 --> 01:32:15.230
the forecast itself
01:32:15.230 --> 01:32:18.050
may have a certain amount of risk associated with it.
01:32:18.050 --> 01:32:21.400
Meaning, the demand forecast may have a risk
01:32:21.400 --> 01:32:23.720
that it will be higher than we think.
01:32:23.720 --> 01:32:25.620
And the wind forecast has a risk
01:32:25.620 --> 01:32:27.370
that it may be lower than we think.
01:32:27.370 --> 01:32:30.090
So he's looking at it from that perspective, as well.
01:32:30.090 --> 01:32:30.967
So that's saying,
01:32:30.967 --> 01:32:32.623
he's looking at it saying,
01:32:33.860 --> 01:32:38.165
on some days, on your four day forecast,
01:32:38.165 --> 01:32:42.160
I'm very confident, this is what's going to happen.
01:32:42.160 --> 01:32:43.540
There's no perfect crystal ball
01:32:43.540 --> 01:32:44.913
but some days he's saying,
01:32:46.210 --> 01:32:48.010
I'm pretty confident this is what's going to happen.
01:32:48.010 --> 01:32:50.650
But on other days, he's looking ahead and saying,
01:32:50.650 --> 01:32:52.090
this is a variety of factors.
01:32:52.090 --> 01:32:54.320
I'm really not sure how this is going to play out.
01:32:54.320 --> 01:32:55.850
I've got an idea.
Right.
01:32:55.850 --> 01:32:58.250
Okay, how does that inform operations?
01:32:58.250 --> 01:33:02.050
Well, he's in constant communication with operations
01:33:02.050 --> 01:33:04.750
and they're looking at it day-to-day in the mornings.
01:33:04.750 --> 01:33:07.010
And if there's a reason for an update,
01:33:07.010 --> 01:33:09.073
that gets communicated in.
01:33:09.073 --> 01:33:14.073
The meteorologist not only has his own, you know,
01:33:14.120 --> 01:33:16.760
expert opinion, but he also has a variety
01:33:16.760 --> 01:33:18.330
of different forecasts that he's looking at.
01:33:18.330 --> 01:33:19.890
So if there is a spread
01:33:19.890 --> 01:33:21.450
between some of the different forecasts
01:33:21.450 --> 01:33:22.620
that he has available,
01:33:22.620 --> 01:33:24.470
he communicates that to the operators
01:33:25.872 --> 01:33:28.410
and we talk about our wind forecast.
01:33:28.410 --> 01:33:30.650
We talk about our customer demand forecast.
01:33:30.650 --> 01:33:34.420
But in reality, we have seven customer demand forecasts
01:33:34.420 --> 01:33:36.470
and we have several wind forecasts.
01:33:36.470 --> 01:33:38.730
I believe we have two primary wind forecasts
01:33:38.730 --> 01:33:41.010
and then we have a ramping forecast, as well.
01:33:41.010 --> 01:33:44.620
And so they have the option to select forecasts
01:33:44.620 --> 01:33:48.190
that they think best match the upcoming conditions.
01:33:48.190 --> 01:33:50.310
And you'll see the operators talking about
01:33:50.310 --> 01:33:53.100
well, we think we should select this forecast for today,
01:33:53.100 --> 01:33:55.370
but we need this other forecast for tomorrow
01:33:55.370 --> 01:33:57.820
and the next day because of exactly these issues
01:33:57.820 --> 01:33:59.210
that we're talking about here.
01:33:59.210 --> 01:34:01.730
So, what did that look like on the Saturday and Sunday,
01:34:01.730 --> 01:34:03.910
for example, as it relates to wind?
01:34:05.220 --> 01:34:08.223
I know you can't really forecast unplanned outages so-
01:34:09.310 --> 01:34:11.500
Yeah, I do know there was a lot of chatter back and forth
01:34:11.500 --> 01:34:13.780
about which forecast should be selected
01:34:13.780 --> 01:34:16.570
and selecting different forecasts
01:34:16.570 --> 01:34:17.933
across the span of the day.
01:34:18.780 --> 01:34:21.910
Just getting back to what I was saying though, you know,
01:34:21.910 --> 01:34:24.050
we see some of these patterns
01:34:24.050 --> 01:34:25.860
like this panhandle to Dallas
01:34:25.860 --> 01:34:28.580
and also we see, you know, in the late afternoons,
01:34:28.580 --> 01:34:31.410
we see the coastal wind picking up, typically.
01:34:31.410 --> 01:34:34.210
That's a pattern that we see over the summer
01:34:34.210 --> 01:34:36.680
but we just don't have enough data yet to know,
01:34:36.680 --> 01:34:38.630
well, is that a pattern we can expect to see
01:34:38.630 --> 01:34:40.930
the first two weeks of June?
01:34:40.930 --> 01:34:41.770
Does that make sense?
01:34:41.770 --> 01:34:45.020
And so, I think that's kind of where we were
01:34:46.030 --> 01:34:48.020
in the last few weeks is
01:34:49.330 --> 01:34:51.340
we have the seasonal assessments
01:34:51.340 --> 01:34:55.040
that are based on seasonal expectations
01:34:55.040 --> 01:34:57.623
but when you're in the early part of a season,
01:34:58.880 --> 01:35:00.260
there may be some-
01:35:00.260 --> 01:35:01.369
It's a different animals than-
01:35:01.369 --> 01:35:04.010
It could be, it could be a different animal.
01:35:04.010 --> 01:35:04.850
And that's the nuance.
01:35:04.850 --> 01:35:06.980
Like if we kind of take this to the next step
01:35:06.980 --> 01:35:09.190
or continue talking about it,
01:35:09.190 --> 01:35:13.190
is do we need more micro analysis
01:35:14.210 --> 01:35:16.560
to account for your long-term
01:35:16.560 --> 01:35:18.660
and short-term trends
01:35:19.550 --> 01:35:22.330
for scheduling, for resource management,
01:35:22.330 --> 01:35:24.680
for the RUC calculations and stuff like that
01:35:27.655 --> 01:35:29.270
on a more specific basis.
01:35:29.270 --> 01:35:30.970
And what's the line?
01:35:30.970 --> 01:35:34.360
You know, if June is so different,
01:35:34.360 --> 01:35:36.690
but July and August and September,
01:35:36.690 --> 01:35:40.220
thus, the peak are more akin,
01:35:40.220 --> 01:35:41.950
do we need to readjust that?
01:35:41.950 --> 01:35:43.129
And that's one of those questions-
01:35:43.129 --> 01:35:43.962
That's a big question.
01:35:43.962 --> 01:35:45.323
And at the highest level,
01:35:47.660 --> 01:35:49.923
the overarching question is,
01:35:51.690 --> 01:35:53.717
would you say that each one of the,
01:35:55.370 --> 01:35:56.800
kind of worst case scenarios,
01:35:56.800 --> 01:35:58.435
like low wind,
01:35:58.435 --> 01:36:00.820
a lot of unplanned outages.
Where does it intersect?
01:36:00.820 --> 01:36:04.780
And high temperatures.
01:36:04.780 --> 01:36:08.450
Like each of those is a one in 20, roughly?
01:36:08.450 --> 01:36:10.330
Yes, roughly.
Yeah, broad strokes.
01:36:10.330 --> 01:36:13.330
One in 20 chance, on any given day,
01:36:13.330 --> 01:36:16.560
one of those things will happen, right?
01:36:16.560 --> 01:36:19.630
Well, I would say across the summer that, you know,
01:36:19.630 --> 01:36:21.853
so as an example, the low wind,
01:36:22.750 --> 01:36:25.310
the question is are we gonna see low wind
01:36:25.310 --> 01:36:29.990
or relatively, you know, significantly reduced wind
01:36:29.990 --> 01:36:33.990
on a day that is like the peak, like a peak day.
01:36:33.990 --> 01:36:37.017
And so that's the one in 20, right?
01:36:37.017 --> 01:36:38.720
Right, so.
01:36:38.720 --> 01:36:41.070
If you do say two of those things happening,
01:36:41.070 --> 01:36:44.340
and we went through this math before,
01:36:44.340 --> 01:36:48.120
that's one over 400.
Yeah, right.
01:36:48.120 --> 01:36:49.210
It's getting unlikely.
01:36:49.210 --> 01:36:52.170
Which in percentage terms
01:36:52.170 --> 01:36:54.360
is a quarter of a percent chance.
01:36:54.360 --> 01:36:56.220
Yeah.
Happening.
01:36:56.220 --> 01:36:58.770
And I feel like this week
01:36:58.770 --> 01:37:02.180
wasn't a quarter of a percent chance happening.
01:37:02.180 --> 01:37:06.510
And so that's when I said my big high level question is
01:37:07.370 --> 01:37:11.913
how can we get better at, you know,
01:37:12.936 --> 01:37:14.130
I want to be careful about the statistics.
01:37:14.130 --> 01:37:17.420
Like it's less than a quarter of a percent chance happening
01:37:17.420 --> 01:37:19.250
but that resets every day.
Hmm hmm.
01:37:19.250 --> 01:37:21.840
That's not that it's only going to happen,
01:37:21.840 --> 01:37:23.506
every so often.
01:37:23.506 --> 01:37:25.733
And the other point is, is that again,
01:37:26.850 --> 01:37:30.548
the economy is waking up from COVID
01:37:30.548 --> 01:37:31.910
and Texas changed a lot.
01:37:31.910 --> 01:37:33.590
And Carrie will be able to kind of speak to this
01:37:33.590 --> 01:37:36.330
from pricing standpoint and load growth standpoints,
01:37:36.330 --> 01:37:37.760
and you can as well,
01:37:37.760 --> 01:37:42.523
but what does this look like in a year, after,
01:37:43.670 --> 01:37:48.510
Texas is a manufacturing engine for the country.
01:37:48.510 --> 01:37:51.500
Petrochemical production comes alive again, you know,
01:37:51.500 --> 01:37:52.850
with higher prices.
01:37:52.850 --> 01:37:53.990
What does that look like?
01:37:53.990 --> 01:37:55.380
And to account for that,
01:37:55.380 --> 01:37:59.060
in your seasonal forecast or a more specific basis
01:37:59.060 --> 01:38:03.401
to account for your low probability events, I mean-
01:38:03.401 --> 01:38:05.457
Well, it's apparently not as low probability as-
01:38:05.457 --> 01:38:07.290
That's the question.
As we think.
01:38:07.290 --> 01:38:10.890
Yeah, one other thing I did want to mention, you know,
01:38:10.890 --> 01:38:14.200
as you were talking about Texas coming alive, you know,
01:38:14.200 --> 01:38:15.890
we've talked about this before.
01:38:15.890 --> 01:38:18.900
We have a lot of resources that are under development
01:38:18.900 --> 01:38:20.370
or planned under development.
01:38:20.370 --> 01:38:22.130
Now a lot of those are solar right now,
01:38:22.130 --> 01:38:23.720
specific interest in solar
01:38:23.720 --> 01:38:27.020
and then growing interest in batteries, as well.
01:38:27.020 --> 01:38:32.020
So as the economy comes back, as customer demand grows,
01:38:32.700 --> 01:38:36.120
we're also seeing significant interest in resources.
01:38:36.120 --> 01:38:38.210
But one of the interesting things, I think,
01:38:38.210 --> 01:38:39.750
again, over the last two weeks,
01:38:39.750 --> 01:38:41.850
and looking at this idea of maybe being
01:38:41.850 --> 01:38:44.480
a little bit more granular in the analysis,
01:38:44.480 --> 01:38:46.430
one of the interesting things is
01:38:46.430 --> 01:38:48.930
as those units are coming online,
01:38:48.930 --> 01:38:52.400
we're including them if they meet certain timeline cutoffs,
01:38:52.400 --> 01:38:55.060
we're including them in the seasonal assessments.
01:38:55.060 --> 01:38:57.620
But the first two weeks of June,
01:38:57.620 --> 01:38:59.430
they may not be all there yet.
01:38:59.430 --> 01:39:03.060
And there were some examples of some of our solar plants
01:39:03.060 --> 01:39:05.930
that are expected to be online this summer,
01:39:05.930 --> 01:39:08.360
but are not fully online yet
01:39:08.360 --> 01:39:10.580
or do not appear to be fully online yet.
01:39:10.580 --> 01:39:12.290
So that could have been another factor.
01:39:12.290 --> 01:39:13.600
That's the example of me thinking
01:39:13.600 --> 01:39:17.720
there were 7,000 megawatts when there were in fact six
01:39:17.720 --> 01:39:21.630
and again, they're targeting July.
01:39:21.630 --> 01:39:23.660
Well, no they're targeting August and September,
01:39:23.660 --> 01:39:26.650
that last 26 hours at the transition
01:39:26.650 --> 01:39:28.550
to the month when Texas is boiling, you know,
01:39:28.550 --> 01:39:33.090
and we know that system-wide offer cap may be attained.
01:39:33.090 --> 01:39:35.500
Yeah and I would argue,
01:39:35.500 --> 01:39:37.140
they're probably coming online
01:39:37.140 --> 01:39:39.810
as quickly as they possibly can, but they, you know,
01:39:39.810 --> 01:39:41.940
and they may be completely meeting their targets.
01:39:41.940 --> 01:39:44.300
But the way this month,
01:39:44.300 --> 01:39:45.920
this way the seasonal assessment,
01:39:45.920 --> 01:39:48.450
the summer assessment runs,
01:39:48.450 --> 01:39:51.800
you know, they don't have to be fully online by June 15th
01:39:51.800 --> 01:39:53.780
in order to be included in this assessment.
01:39:53.780 --> 01:39:55.700
And the other thing I'd say,
01:39:55.700 --> 01:39:57.240
what Warren works on with these things.
01:39:57.240 --> 01:39:58.530
I mean, it plays into everything
01:39:58.530 --> 01:40:00.240
and you could teach me a class on this,
01:40:00.240 --> 01:40:03.750
but it is, at a high level,
01:40:03.750 --> 01:40:05.900
it impacts the forward prices.
01:40:05.900 --> 01:40:09.820
And again, the forward prices are what this market
01:40:09.820 --> 01:40:12.120
and Carrie can tell us about it
01:40:12.120 --> 01:40:14.890
but that's what pays for the maintenance.
01:40:14.890 --> 01:40:17.040
That's what pays for everything.
01:40:17.040 --> 01:40:18.510
That's what keeps it going.
01:40:18.510 --> 01:40:22.270
And so whatever analysis ERCOT promulgates
01:40:22.270 --> 01:40:26.880
on aggregated and even a more targeted basis,
01:40:26.880 --> 01:40:28.650
that's the driving force.
01:40:28.650 --> 01:40:31.330
And again, how we account for the intermittency.
01:40:31.330 --> 01:40:35.120
So as that 20 gigawatts of solar comes in
01:40:35.120 --> 01:40:38.293
and how it plays in and how you're accounting for it,
01:40:38.293 --> 01:40:40.453
that's going to impact those forwards.
01:40:42.580 --> 01:40:43.510
And that's very important.
01:40:43.510 --> 01:40:44.557
That's very important.
01:40:44.557 --> 01:40:46.040
And we certainly,
01:40:46.040 --> 01:40:49.440
I think Texas is certainly
01:40:49.440 --> 01:40:52.020
willing to compensate private companies
01:40:52.020 --> 01:40:53.700
that generate power when we need power.
01:40:53.700 --> 01:40:54.533
Right.
01:40:55.460 --> 01:40:56.800
We never argue against that
01:40:56.800 --> 01:40:59.440
but also we have to overlay and juxtapose
01:40:59.440 --> 01:41:01.390
that with reliability.
Right.
01:41:01.390 --> 01:41:05.720
And, you know, it's Monday,
01:41:05.720 --> 01:41:08.120
you know, Sunday, Monday, Tuesday
01:41:08.120 --> 01:41:10.840
didn't feel like a quarter of a percent chance
01:41:10.840 --> 01:41:14.630
and we're still working out, you know,
01:41:14.630 --> 01:41:16.780
we're still working through that situation.
01:41:17.630 --> 01:41:19.250
And so I want to make sure that
01:41:20.140 --> 01:41:23.040
we're using every tool possible
01:41:23.040 --> 01:41:24.980
to make sure that we have
01:41:24.980 --> 01:41:27.150
not only at a seasonal level,
01:41:27.150 --> 01:41:30.470
but we have the best possible visibility
01:41:30.470 --> 01:41:35.470
on when the confluence of negative factors can occur.
01:41:36.470 --> 01:41:38.023
Wind's variable, we know that,
01:41:38.860 --> 01:41:41.603
but we had, I think, what was like Monday,
01:41:43.607 --> 01:41:46.990
we expected six or 7,000 megawatts
01:41:46.990 --> 01:41:51.750
out of 25,000 total installed and we got 3,600?
01:41:51.750 --> 01:41:54.460
That's the nature of wind, that's fine,
01:41:54.460 --> 01:41:57.330
but we need to make sure that we're looking at everything,
01:41:57.330 --> 01:41:59.720
the correlations, like the, you know,
01:41:59.720 --> 01:42:01.881
the DFW panhandle spread
01:42:01.881 --> 01:42:04.960
where that's a positive correlation, right.
01:42:04.960 --> 01:42:08.840
And that's a mathematically positive correlation
01:42:08.840 --> 01:42:11.737
but also a positive for the grid.
01:42:11.737 --> 01:42:14.740
And that when high heat in one area
01:42:14.740 --> 01:42:16.970
increases demand and puts pressure,
01:42:16.970 --> 01:42:19.170
that's offset by increased production
01:42:19.170 --> 01:42:20.460
but there are other,
01:42:20.460 --> 01:42:23.630
how much visibility do we have into other correlations?
01:42:23.630 --> 01:42:24.910
You know, is there a correlation
01:42:24.910 --> 01:42:26.790
between high heat and outages?
01:42:26.790 --> 01:42:31.790
Is there a correlation between, you know, wind and solar?
01:42:32.396 --> 01:42:33.590
I don't know.
01:42:33.590 --> 01:42:35.760
Do do we have much visibility on that?
01:42:35.760 --> 01:42:37.900
Actually, that's something we're starting to look at
01:42:37.900 --> 01:42:42.430
and we are really looking for
01:42:42.430 --> 01:42:44.990
starting off, obviously, looking for those times
01:42:44.990 --> 01:42:47.320
when wind is lower than expected
01:42:47.320 --> 01:42:48.727
and solar is lower than expected.
01:42:48.727 --> 01:42:49.940
And those,
01:42:49.940 --> 01:42:52.580
based on the limited amount of historical data we have,
01:42:52.580 --> 01:42:55.380
it indicates that that's unlikely to happen.
01:42:55.380 --> 01:42:58.170
Typically, the conditions that drive lower solar,
01:42:58.170 --> 01:43:02.310
clouds, fronts, et cetera, drives more wind.
01:43:02.310 --> 01:43:04.900
But again, I think one of the issues we face
01:43:04.900 --> 01:43:06.868
is that you know,
01:43:06.868 --> 01:43:09.174
the data set's very thin.
01:43:09.174 --> 01:43:10.680
We've gotta work with the data we've got.
01:43:10.680 --> 01:43:11.513
Yeah.
01:43:11.513 --> 01:43:15.300
But also, I also want to be wary
01:43:15.300 --> 01:43:19.663
of averages, relying too heavily on averages.
01:43:20.770 --> 01:43:25.770
And that's where it's kind of a statistical trick of the,
01:43:25.920 --> 01:43:29.360
you know, even if you have a normal distribution, you know,
01:43:29.360 --> 01:43:31.890
some days it's really high wind or high outages,
01:43:31.890 --> 01:43:34.400
or, you know, some days it's really low
01:43:34.400 --> 01:43:36.940
and you overlay that distribute,
01:43:36.940 --> 01:43:38.040
but, you know, on average,
01:43:38.040 --> 01:43:39.700
we're kind of in the middle
01:43:39.700 --> 01:43:41.040
and you overlay that with outages,
01:43:41.040 --> 01:43:42.450
you overlay that with solar,
01:43:42.450 --> 01:43:44.160
you overlay that with high temperatures
01:43:44.160 --> 01:43:45.617
and it comes out, you kind of mix it all up
01:43:45.617 --> 01:43:47.570
and it comes out to this, you know,
01:43:47.570 --> 01:43:50.150
a quarter of a percent probability.
01:43:50.150 --> 01:43:55.150
If you rely on that, I don't want to just rely on that
01:43:55.630 --> 01:43:59.160
and ignore and not be cognizant of the fact
01:43:59.160 --> 01:44:01.250
that when it comes to, you know,
01:44:01.250 --> 01:44:03.083
averages only work over-
01:44:04.110 --> 01:44:05.877
Longest data set.
Lots of iterations.
01:44:05.877 --> 01:44:06.710
Right, that's right.
01:44:06.710 --> 01:44:08.660
Kind of infinity interactions, right.
01:44:08.660 --> 01:44:11.510
You can flip a coin, heads or tails and, you know,
01:44:11.510 --> 01:44:13.447
over time it'll be 50%,
01:44:13.447 --> 01:44:15.920
but you can get five tails in a row.
01:44:15.920 --> 01:44:18.373
And in the business we're in,
01:44:19.210 --> 01:44:22.940
in terms of providing reliability to Texans,
01:44:22.940 --> 01:44:26.110
I mean, the math resets every morning
01:44:27.060 --> 01:44:31.890
and we don't get infinite flips of the coin.
01:44:31.890 --> 01:44:34.040
Every morning, we're skydiving
01:44:34.040 --> 01:44:38.480
and you only get one chance for it to go wrong.
01:44:38.480 --> 01:44:40.890
And after that, the averages don't matter.
01:44:40.890 --> 01:44:44.050
And so, I know there's a lot of serious calculus
01:44:44.050 --> 01:44:45.040
that goes into this
01:44:46.040 --> 01:44:49.115
but it sounds like we've got a lot of room to improve.
01:44:49.115 --> 01:44:49.948
Absolutely.
01:44:49.948 --> 01:44:53.550
On within the limits of the data,
01:44:53.550 --> 01:44:55.210
evaluating these correlations
01:44:56.200 --> 01:44:59.530
and also making sure we evaluate the correlations
01:44:59.530 --> 01:45:00.880
between different factors,
01:45:00.880 --> 01:45:03.610
but also auto correlations within the single factors
01:45:04.860 --> 01:45:09.220
and how that can inform our improving our predictions.
01:45:09.220 --> 01:45:12.570
And then also make sure those,
01:45:12.570 --> 01:45:14.700
that best information, that best analysis,
01:45:14.700 --> 01:45:17.390
informs operations.
01:45:17.390 --> 01:45:19.290
I know, one of the highlights
01:45:19.290 --> 01:45:21.960
I made sure Woody pointed out was that
01:45:23.281 --> 01:45:24.520
ERCOT is taking a new approach
01:45:24.520 --> 01:45:29.340
to making sure those real-time conditions that we're seeing
01:45:29.340 --> 01:45:31.113
inform the margin of safety.
01:45:32.300 --> 01:45:35.430
So we're now taking a look at
01:45:35.430 --> 01:45:37.460
what does the next 24 hours look like?
01:45:37.460 --> 01:45:39.950
What does the next 48 hours look like?
01:45:39.950 --> 01:45:42.460
And that's what happened on Sunday.
01:45:42.460 --> 01:45:43.473
Y'all looked at it,
01:45:44.730 --> 01:45:46.660
went above and beyond the standard formula
01:45:46.660 --> 01:45:48.970
and made sure that we had as much generation
01:45:48.970 --> 01:45:50.470
as we possibly could.
Sure.
01:45:51.655 --> 01:45:53.130
And we still hit peak.
01:45:53.130 --> 01:45:55.740
I mean, money was still made in the market.
01:45:55.740 --> 01:45:59.080
And, you know, and the other thing
01:45:59.080 --> 01:46:02.003
that's feeding into this is capital markets,
01:46:02.980 --> 01:46:06.680
like a long term range
01:46:06.680 --> 01:46:10.080
of revenues that can be made.
01:46:10.080 --> 01:46:13.830
And they like stability in that.
01:46:13.830 --> 01:46:18.540
And so, again, as you start to analyze this
01:46:18.540 --> 01:46:21.083
and you start to analyze correlations between,
01:46:23.200 --> 01:46:24.790
for instance,
01:46:24.790 --> 01:46:27.560
high intermittency volatility
01:46:27.560 --> 01:46:29.730
and forced outage rates.
01:46:29.730 --> 01:46:30.930
You know, are things breaking
01:46:30.930 --> 01:46:33.930
because of traumatic fluctuations in power?
01:46:33.930 --> 01:46:35.770
Because again, coal plants are not designed
01:46:35.770 --> 01:46:37.690
to ramp up quickly.
01:46:37.690 --> 01:46:39.400
I mean, they get beat up that way.
01:46:39.400 --> 01:46:43.620
And especially, the age of the fleet.
01:46:43.620 --> 01:46:45.118
I've been pointing out to policymakers,
01:46:45.118 --> 01:46:48.780
we do have a gas fleet that was installed
01:46:48.780 --> 01:46:52.570
between 1995 and 2007, 2005.
01:46:52.570 --> 01:46:53.740
So they're 20 years old.
01:46:53.740 --> 01:46:55.520
So what's that doing to the fleet?
01:46:55.520 --> 01:46:57.563
And how's that being baked into your outage number?
01:46:57.563 --> 01:47:00.420
Because I know a lot of people were talking about that.
01:47:02.150 --> 01:47:05.380
But again, how you're weighting some of these things
01:47:06.870 --> 01:47:08.250
and when they produce,
01:47:08.250 --> 01:47:10.860
that's gonna affect forward projections
01:47:10.860 --> 01:47:14.673
on how much money can be made on a regular basis,
01:47:15.860 --> 01:47:19.270
possibly over a broader period of time, not just at peak.
01:47:19.270 --> 01:47:21.020
I think we're looking at a broader,
01:47:24.200 --> 01:47:27.193
profitable period for the ERCOT market.
01:47:30.170 --> 01:47:31.270
Yeah, I agree with that.
01:47:31.270 --> 01:47:33.940
Your scarcity conditions aren't gonna be driven
01:47:33.940 --> 01:47:35.297
specifically by your peak customer demand.
01:47:35.297 --> 01:47:39.010
(overlapping chattering)
01:47:39.010 --> 01:47:40.590
Anything else for Warren?
No, sir.
01:47:40.590 --> 01:47:41.927
Thank you very much.
01:47:41.927 --> 01:47:42.760
I appreciate you being here.
01:47:42.760 --> 01:47:44.050
Yeah, yeah, my pleasure.
01:47:45.770 --> 01:47:46.603
All right, Carrie,
01:47:46.603 --> 01:47:49.580
do you have any thoughts you'd like to contribute
01:47:49.580 --> 01:47:52.500
or share on, especially, related to the outages
01:47:52.500 --> 01:47:54.663
and potential for market manipulation?
01:47:55.532 --> 01:47:57.458
Sure.
And how to mitigate that?
01:47:57.458 --> 01:48:00.600
This is Carrie Bevins with the Independent Market Monitor.
01:48:00.600 --> 01:48:03.670
Part of our role is to detect market manipulation.
01:48:03.670 --> 01:48:08.110
And we will study this weather event
01:48:08.960 --> 01:48:10.240
or market event,
01:48:10.240 --> 01:48:12.313
just like we would any market event.
01:48:14.170 --> 01:48:16.540
You know, we look at it from the market side.
01:48:16.540 --> 01:48:18.440
So whereas, you know,
01:48:18.440 --> 01:48:21.120
other entities might look from a reliability side.
01:48:21.120 --> 01:48:23.370
We're looking to see, you know,
01:48:23.370 --> 01:48:25.840
we have tools and we have things that we look at
01:48:25.840 --> 01:48:29.040
to determine if there is any evidence
01:48:29.040 --> 01:48:31.193
that there was physical withholding.
01:48:32.610 --> 01:48:36.640
So that would be entities using their,
01:48:36.640 --> 01:48:38.970
exercising their market power by, you know,
01:48:38.970 --> 01:48:40.700
withholding some generation from the market
01:48:40.700 --> 01:48:43.690
so that the rest of their fleet is profitable.
01:48:43.690 --> 01:48:47.420
I will say just, stepping back and looking at, you know,
01:48:47.420 --> 01:48:49.340
we look a lot at incentives
01:48:50.220 --> 01:48:53.380
and the incentives for
01:48:55.010 --> 01:48:58.830
physical withholding are lower than they might otherwise be
01:48:58.830 --> 01:49:01.620
because we have the low cap in place right now, right?
01:49:01.620 --> 01:49:04.830
So it's a big risk to take,
01:49:04.830 --> 01:49:07.397
to try to effectuate that
01:49:07.397 --> 01:49:11.670
and you're not gonna get as much profit out of your fleet
01:49:11.670 --> 01:49:15.020
as you might have with a $9,000 offer cap, say.
01:49:15.020 --> 01:49:19.230
So I don't think the conditions are necessarily ripe
01:49:19.230 --> 01:49:20.140
from that perspective,
01:49:20.140 --> 01:49:22.200
from an incentive perspective,
01:49:22.200 --> 01:49:24.010
but we will perform our investigation.
01:49:24.010 --> 01:49:24.910
And if we find anything,
01:49:24.910 --> 01:49:27.540
we'll refer it to the Commission for enforcement.
01:49:27.540 --> 01:49:28.373
Excellent.
01:49:28.373 --> 01:49:29.813
That's very important to make sure
01:49:29.813 --> 01:49:33.923
people aren't gaming the system by withholding generation,
01:49:34.920 --> 01:49:37.020
electric generation when Texas needs it.
01:49:37.020 --> 01:49:37.853
Absolutely.
01:49:37.853 --> 01:49:40.640
What's the rough, I know this is all in real time
01:49:40.640 --> 01:49:41.473
and fast moving,
01:49:41.473 --> 01:49:45.480
a sense of a rough timeline we could expect?
01:49:45.480 --> 01:49:46.313
It'd probably be a couple months
01:49:46.313 --> 01:49:49.267
because we will need to issue some requests for information.
01:49:49.267 --> 01:49:51.280
We have to do a deep dive into that information.
01:49:51.280 --> 01:49:53.510
And, you know, I don't want to talk publicly
01:49:53.510 --> 01:49:55.030
too much about our methods, but, you know,
01:49:55.030 --> 01:49:56.910
it does take some time.
01:49:56.910 --> 01:49:58.010
Fair enough.
01:49:59.660 --> 01:50:03.520
In terms of your access to,
01:50:03.520 --> 01:50:06.500
again, we were speaking of the 60 day
01:50:08.020 --> 01:50:10.113
moratorium on access to information.
01:50:12.340 --> 01:50:16.230
You get special exemption to that, correct?
01:50:16.230 --> 01:50:17.713
We're centrally within the ERCOT firewall,
01:50:17.713 --> 01:50:20.322
meaning we can see anything that EROCT can see.
01:50:20.322 --> 01:50:25.010
Okay and so you'll be able to see near term,
01:50:25.010 --> 01:50:30.010
whether there were any concentrations of forced outages
01:50:30.070 --> 01:50:34.700
as a part of this within any particular market participants?
01:50:35.900 --> 01:50:36.793
Yes.
Okay.
01:50:38.190 --> 01:50:39.970
Do you have any thoughts on,
01:50:39.970 --> 01:50:42.250
because again, you do, I mean,
01:50:42.250 --> 01:50:43.763
competition is your business.
01:50:45.750 --> 01:50:48.780
On the 60 day issue,
01:50:48.780 --> 01:50:52.540
like what, you know, what should we consider?
01:50:52.540 --> 01:50:56.130
Yeah, I think, so number one,
01:50:56.130 --> 01:51:01.130
the ERCOT ISO has some of the most transparent data roles
01:51:01.130 --> 01:51:02.260
amongst the ISOs.
01:51:02.260 --> 01:51:04.650
So there's already a lot of transparency there.
01:51:04.650 --> 01:51:06.760
And some of that had to do with, you know,
01:51:06.760 --> 01:51:09.740
kind of, you know,
01:51:09.740 --> 01:51:13.700
in exchange for these also high offer caps that, you know,
01:51:13.700 --> 01:51:15.007
you are in the market,
01:51:15.007 --> 01:51:17.750
you also have this kind of radical transparency
01:51:17.750 --> 01:51:18.980
on the other side.
01:51:18.980 --> 01:51:21.240
And there's definitely some benefits to that
01:51:21.240 --> 01:51:23.280
is that, you know, sunlight is always good
01:51:23.280 --> 01:51:26.670
and your competitors are keeping you in check
01:51:26.670 --> 01:51:29.683
just as much as I am, right, in some respects.
01:51:31.020 --> 01:51:33.450
So, but there are some concerns, definitely,
01:51:33.450 --> 01:51:35.190
in the shorter term.
01:51:35.190 --> 01:51:38.420
If you are aware of, and here,
01:51:38.420 --> 01:51:41.170
we're mostly talking about transmission problems
01:51:41.170 --> 01:51:44.720
but if you're aware that, you know,
01:51:44.720 --> 01:51:47.150
one of your competitors is outaged
01:51:47.150 --> 01:51:49.100
and won't be back for a certain number,
01:51:50.197 --> 01:51:52.710
it's that knowledge of when you might be back
01:51:53.760 --> 01:51:56.240
that you can use your advantage
01:51:56.240 --> 01:51:58.250
to perhaps increase your offer,
01:51:58.250 --> 01:52:01.070
increase your profits above a competitive level.
01:52:01.070 --> 01:52:02.840
And that would be our concern with that.
01:52:02.840 --> 01:52:06.010
But I can say that, as you spoke to,
01:52:06.010 --> 01:52:09.620
there are products in the private market
01:52:09.620 --> 01:52:12.470
in which you can get a lot of this information
01:52:12.470 --> 01:52:16.890
and wouldn't necessarily have strong concerns
01:52:16.890 --> 01:52:19.560
with maybe some one-off disclosures.
01:52:19.560 --> 01:52:22.480
But I think as a procedure
01:52:22.480 --> 01:52:24.280
as we go through time,
01:52:24.280 --> 01:52:26.370
it's better to have that, you know,
01:52:26.370 --> 01:52:28.340
whether 60 days is the right number, you know,
01:52:28.340 --> 01:52:30.210
we can certainly have that discussion,
01:52:30.210 --> 01:52:35.210
but some sort of period in which that data is not disclosed.
01:52:35.660 --> 01:52:36.970
But for one-off events,
01:52:36.970 --> 01:52:41.240
I think there's probably not a massive concern,
01:52:41.240 --> 01:52:42.740
a competitive concern on that.
01:52:44.780 --> 01:52:45.723
In terms of,
01:52:46.850 --> 01:52:48.710
I'm assuming you've already started digging in,
01:52:48.710 --> 01:52:50.463
in terms of financial analysis,
01:52:51.650 --> 01:52:53.160
do you happen to know off the top of your head,
01:52:53.160 --> 01:52:56.380
because it is something that we need to watch?
01:52:56.380 --> 01:53:00.140
A lot of generators lost money this week.
01:53:00.140 --> 01:53:03.050
The breakage was both physical and financial,
01:53:03.050 --> 01:53:04.670
I think is fair to say.
01:53:04.670 --> 01:53:08.550
Do you happen to know ballpark what the penalties incurred
01:53:08.550 --> 01:53:11.690
and not any particular market participant
01:53:11.690 --> 01:53:13.400
but on aggregate,
01:53:13.400 --> 01:53:15.090
what we're looking at in the ERCOT market?
01:53:15.090 --> 01:53:16.360
I mean, we just came out of February.
01:53:16.360 --> 01:53:18.910
So I'm wondering the health of the system.
01:53:18.910 --> 01:53:20.210
Sure.
And what we're seeing.
01:53:20.210 --> 01:53:22.700
I'd be happy to share that information with you later.
01:53:22.700 --> 01:53:24.570
We are still waiting for,
01:53:24.570 --> 01:53:26.400
it takes days after the event
01:53:26.400 --> 01:53:28.350
for like meter data and things like that to come through
01:53:28.350 --> 01:53:31.330
for us to get an accurate picture of net financial position.
01:53:31.330 --> 01:53:33.840
So we're going to need probably until next week,
01:53:33.840 --> 01:53:35.640
until we have a good point of view
01:53:35.640 --> 01:53:36.750
and I'd be happy to follow up with you-
01:53:36.750 --> 01:53:40.510
Yeah, we're still dealing with a lot of outages, today,
01:53:40.510 --> 01:53:42.008
so we're not through yet.
01:53:42.008 --> 01:53:44.180
We're not of the woods, yet.
01:53:44.180 --> 01:53:49.130
So, obviously, take the time you need to.
01:53:49.130 --> 01:53:50.930
Let's get through the event.
Yep.
01:53:51.902 --> 01:53:54.016
That's all I have.
All right.
01:53:54.016 --> 01:53:56.599
Thank you, Carrie.
Sure thing.
01:53:57.963 --> 01:53:59.863
I don't have anything else on 11.
01:53:59.863 --> 01:54:00.890
Do you?
No, sir.
01:54:00.890 --> 01:54:04.391
And I don't have anything on items 12 through 16.
01:54:04.391 --> 01:54:05.808
Do you?
I don't.
01:54:09.370 --> 01:54:11.090
Good morning's work.
01:54:11.090 --> 01:54:13.180
There being no further business of this meeting,
01:54:13.180 --> 01:54:14.979
we will not meet in closed session today.
01:54:14.979 --> 01:54:16.347
No, sir.
01:54:16.347 --> 01:54:18.270
So having no further businesses,
01:54:18.270 --> 01:54:20.540
meeting of the Public Utility Commission of Texas
01:54:20.540 --> 01:54:22.239
is hereby adjourned.
01:54:22.239 --> 01:54:23.072
(gavel bangs)