WEBVTT 00:00:12.170 --> 00:00:13.980 This meeting of the Public Utility Commission 00:00:13.980 --> 00:00:15.950 of Texas will come to order to consider matters 00:00:15.950 --> 00:00:18.620 that have been duly posted with the Secretary of State 00:00:18.620 --> 00:00:21.950 of Texas for September 23, 2021. 00:00:21.950 --> 00:00:23.420 For the record, my name is Peter Lake 00:00:23.420 --> 00:00:25.230 and with me today are Will McAdams, Lori Cobos, 00:00:25.230 --> 00:00:26.670 and Jimmy Glotfelty. 00:00:26.670 --> 00:00:27.640 Before we dive in, 00:00:27.640 --> 00:00:30.840 I think Jimmy has an introduction he'd like to make. 00:00:30.840 --> 00:00:32.820 Thank you, Mr. Chairman. 00:00:32.820 --> 00:00:36.290 For everybody in the room and those online I'm filling 00:00:36.290 --> 00:00:38.670 out my staff and I wanted to introduce VA Stevens, 00:00:38.670 --> 00:00:40.240 who will be my chief of staff. 00:00:40.240 --> 00:00:42.260 And she's been around these parts, 00:00:42.260 --> 00:00:44.160 not necessarily the PUC, for a long time. 00:00:44.160 --> 00:00:46.960 But she's been at the Capitol and the TNRCC 00:00:46.960 --> 00:00:49.530 and then with me to streamline permitting 00:00:49.530 --> 00:00:50.770 at the federal level. 00:00:50.770 --> 00:00:54.750 And obviously, if you talk to her, you talk to me 00:00:54.750 --> 00:00:57.090 so welcome her. 00:00:57.090 --> 00:00:57.923 Thank you. 00:00:58.977 --> 00:01:02.764 (participants applauding) 00:01:02.764 --> 00:01:03.681 Yes, sir. 00:01:04.880 --> 00:01:06.110 All right, Mr. Journeay, 00:01:06.110 --> 00:01:10.743 could you please walk us through today's Consent Agenda? 00:01:12.490 --> 00:01:13.380 Good morning, Commissioner. 00:01:13.380 --> 00:01:15.760 By individual ballot, the following items were placed 00:01:15.760 --> 00:01:17.100 on your Consent Agenda. 00:01:17.100 --> 00:01:18.893 Six, nine, and 25. 00:01:19.874 --> 00:01:20.793 That's all. 00:01:22.930 --> 00:01:25.360 Is there a motion to approve the items just described 00:01:25.360 --> 00:01:26.253 by Mr. Journeay? 00:01:28.100 --> 00:01:29.543 So moved. Second. 00:01:30.690 --> 00:01:32.183 All in favor, say aye. 00:01:32.183 --> 00:01:33.016 Aye. Aye. 00:01:33.016 --> 00:01:33.849 Motion passes. 00:01:34.840 --> 00:01:36.480 At this time, we will open for public comment. 00:01:36.480 --> 00:01:38.730 All comments related to a specific agenda item 00:01:38.730 --> 00:01:41.190 will be heard when that item is taken up. 00:01:41.190 --> 00:01:44.740 This is for general comments from the public only. 00:01:44.740 --> 00:01:47.010 Speakers will be limited to three minutes. 00:01:47.010 --> 00:01:48.588 Mr. Journeay, do we have anyone signed up 00:01:48.588 --> 00:01:49.788 from the public to speak? 00:01:49.788 --> 00:01:50.621 No, sir. 00:01:50.621 --> 00:01:51.748 No one's signed up. 00:01:51.748 --> 00:01:52.581 Thank you. 00:01:52.581 --> 00:01:55.383 All right, we will not be taking up item number 27. 00:01:56.440 --> 00:01:59.730 That brings us to our normal agenda. 00:01:59.730 --> 00:02:02.003 I don't think I have anything on item one. 00:02:04.310 --> 00:02:07.190 That'll take us to item number two. 00:02:07.190 --> 00:02:10.170 Please lay that out for us, Mr. Journeay. 00:02:10.170 --> 00:02:12.423 Item two is docket 51215. 00:02:12.423 --> 00:02:15.700 It's the application of Entergy for a CCN amendment 00:02:15.700 --> 00:02:18.530 for a solar facility in Liberty County. 00:02:18.530 --> 00:02:20.500 The PFD was issued on July 19th. 00:02:20.500 --> 00:02:22.147 Exceptions and replies were filed. 00:02:22.147 --> 00:02:26.830 The ALJ filed a memo on September 14th, making no changes. 00:02:26.830 --> 00:02:29.620 I have a memo with proposed changes to the PFD 00:02:29.620 --> 00:02:33.271 and Commissioner Cobos has recused herself from this matter. 00:02:33.271 --> 00:02:34.104 Thank you, sir. 00:02:34.104 --> 00:02:37.080 I know this is a big project and would be a good 00:02:37.080 --> 00:02:40.130 diversification of generating resources for that area. 00:02:40.130 --> 00:02:44.610 But there seems to be a lot of problems 00:02:44.610 --> 00:02:49.610 with the application and last minute additional 00:02:49.690 --> 00:02:52.900 of financial promises without any clarity 00:02:52.900 --> 00:02:56.070 on mechanisms to deliver that. 00:02:56.070 --> 00:02:56.913 Thoughts. 00:02:58.630 --> 00:02:59.590 I agree. 00:02:59.590 --> 00:03:01.910 You said the words exactly. 00:03:01.910 --> 00:03:05.143 Financial guarantees that don't have any backup. 00:03:06.350 --> 00:03:08.580 I think they're a tax equity partner 00:03:08.580 --> 00:03:09.810 that we don't know who they are. 00:03:09.810 --> 00:03:11.770 There are a whole host of things that I think it's hard 00:03:11.770 --> 00:03:16.610 to make a decision on and prove beyond a reasonable doubt 00:03:16.610 --> 00:03:18.410 that this is in the public interest. 00:03:19.360 --> 00:03:20.627 Well said on both counts. 00:03:20.627 --> 00:03:21.675 I agree with all of it. 00:03:21.675 --> 00:03:25.830 I appreciate OPUC's intervening in this 00:03:25.830 --> 00:03:26.663 and their concern. 00:03:26.663 --> 00:03:28.470 We're not at that point yet 00:03:28.470 --> 00:03:30.510 and we'll trust that they'll be there 00:03:32.210 --> 00:03:35.260 to ensure the project costs are in line 00:03:35.260 --> 00:03:37.420 with the public interest. 00:03:37.420 --> 00:03:40.350 Is there a motion to adopt the proposal for a decision 00:03:40.350 --> 00:03:41.970 with a modification or the parties 00:03:41.970 --> 00:03:43.630 to jointly file this with exhibits, 00:03:43.630 --> 00:03:46.970 indicating which exhibits are confidential and declassified, 00:03:46.970 --> 00:03:48.170 which was another issue? 00:03:49.400 --> 00:03:50.623 So moved. 00:03:50.623 --> 00:03:51.456 Excuse me, sir. Sure. 00:03:51.456 --> 00:03:54.510 Your motion was to adopt the PFD. 00:03:56.460 --> 00:03:58.274 Approve the PFD- 00:03:58.274 --> 00:04:01.720 As modified. As modified. 00:04:01.720 --> 00:04:03.270 Okay. Is that to, 00:04:03.270 --> 00:04:05.250 I think we want to agree with it. 00:04:05.250 --> 00:04:07.840 We wanna remand it. Yeah, we wanna remand it. 00:04:07.840 --> 00:04:08.673 I wanna remand it. 00:04:08.673 --> 00:04:10.790 Oh, okay, I apologize. 00:04:10.790 --> 00:04:15.790 Remand to remand the docket to OPDM or so. 00:04:18.850 --> 00:04:21.010 So it would fill out the record 00:04:21.010 --> 00:04:23.120 to ensure that we have more information 00:04:23.120 --> 00:04:24.430 about the financial dealings 00:04:24.430 --> 00:04:26.743 about the proposed solar facility 00:04:26.743 --> 00:04:30.190 and the financial understanding of the other parties 00:04:30.190 --> 00:04:32.763 before it comes back to us. 00:04:33.710 --> 00:04:34.987 I withdrawal my motion. 00:04:36.090 --> 00:04:36.923 All right. 00:04:36.923 --> 00:04:40.730 We'll take Jimmy's motion commentary as a motion. 00:04:40.730 --> 00:04:42.530 You second that? Second. 00:04:42.530 --> 00:04:44.090 All right, we've got a motion and a second 00:04:44.090 --> 00:04:48.070 to remand the solar for more clarification. 00:04:48.070 --> 00:04:50.300 All in favor, say aye. Aye. 00:04:50.300 --> 00:04:51.393 Motion passes. 00:04:53.730 --> 00:04:56.180 Item number three, Mr. Journeay. 00:04:56.180 --> 00:04:58.453 Item three is the docket 51556. 00:04:58.453 --> 00:05:00.940 It's the application of Greenville Electric 00:05:00.940 --> 00:05:03.723 to change wholesale transmission rates. 00:05:04.580 --> 00:05:06.870 Proposed order was filed on August 2nd. 00:05:06.870 --> 00:05:09.483 I have a memo with proposed changes to that order. 00:05:12.613 --> 00:05:14.060 Seems to be a reasonable settlement. 00:05:14.060 --> 00:05:16.650 Any thoughts on approving that proposed order? 00:05:16.650 --> 00:05:19.113 Increases rates by the 900,000. 00:05:21.460 --> 00:05:23.740 Staff, parties agreed. 00:05:23.740 --> 00:05:24.590 I'm good with it. 00:05:26.671 --> 00:05:28.784 And would move to, yeah. 00:05:28.784 --> 00:05:29.617 I'm good. 00:05:29.617 --> 00:05:30.450 I'm good with this one. 00:05:30.450 --> 00:05:32.900 And would move to adopt the proposed order, as modified. 00:05:32.900 --> 00:05:35.350 Is there a second? Second. 00:05:35.350 --> 00:05:37.560 All in favor, say aye. Aye. 00:05:37.560 --> 00:05:38.563 Motion passes. 00:05:39.430 --> 00:05:40.880 Item number four, please sir. 00:05:44.220 --> 00:05:46.420 Item four is docket 51959. 00:05:46.420 --> 00:05:51.420 It's the application of TNMP to amend their DCRF factor. 00:05:51.440 --> 00:05:53.363 Proposed order was filed on September 3rd. 00:05:53.363 --> 00:05:56.633 The ALJ filed a correction memo on September 23rd. 00:06:00.976 --> 00:06:02.060 This is another settlement. 00:06:02.060 --> 00:06:05.773 Any thoughts, concerns? 00:06:07.700 --> 00:06:10.360 Yeah, I mean pending Commissioner Cobos 00:06:10.360 --> 00:06:13.560 but I just wanted to make sure what we have here 00:06:13.560 --> 00:06:17.660 conforms to previous precedent that we establish 00:06:17.660 --> 00:06:18.823 our rate case expenses. 00:06:20.240 --> 00:06:23.693 That is the case, even with the revised filing by ALJ. 00:06:24.610 --> 00:06:27.253 Or it's not the case, even with the revised filing by ALJ. 00:06:27.253 --> 00:06:29.890 It's not the case- That's what I wanna confirm 00:06:29.890 --> 00:06:32.203 and that's what I wanna ask for. 00:06:33.235 --> 00:06:36.100 I believe the Commission should modify this order, 00:06:36.100 --> 00:06:37.193 as it's presented, 00:06:38.750 --> 00:06:40.790 to recover only the rate case expenses 00:06:40.790 --> 00:06:42.350 for which there's proper evidence 00:06:42.350 --> 00:06:45.253 and accordingly modify the rate case expenses rider. 00:06:46.130 --> 00:06:49.670 We sort of crossed that bridge in a previous proceeding 00:06:49.670 --> 00:06:52.150 on Cherryland and I just wanna make sure we're consistent 00:06:52.150 --> 00:06:53.030 moving forward. 00:06:53.030 --> 00:06:55.487 Well, more than one, that's a good standard to set. 00:06:57.507 --> 00:06:58.399 I agree. 00:06:58.399 --> 00:07:00.193 Based on my prior experience, 00:07:01.130 --> 00:07:02.830 there have been settlement agreements reached 00:07:02.830 --> 00:07:07.120 where trailing expenses are capped at a certain amount 00:07:07.120 --> 00:07:09.270 to take in account potential rate case expenses 00:07:09.270 --> 00:07:11.858 that would occur at the tail end of the case 00:07:11.858 --> 00:07:13.360 to settle the case. 00:07:13.360 --> 00:07:15.477 However, I don't disagree with the approach 00:07:15.477 --> 00:07:18.650 that's been established by the Commission 00:07:18.650 --> 00:07:21.940 to just cut it off at a certain point 00:07:21.940 --> 00:07:24.890 and let the parties recover their rate case expenses 00:07:24.890 --> 00:07:26.490 in a future proceeding. 00:07:26.490 --> 00:07:28.700 So I agree with the approach 00:07:28.700 --> 00:07:30.680 and would support approving the order 00:07:30.680 --> 00:07:35.080 with the modifications regarding the rate case expenses 00:07:35.080 --> 00:07:39.543 and the changes proposed by TNMP and their exceptions. 00:07:40.981 --> 00:07:41.814 Agreed. 00:07:44.030 --> 00:07:45.740 Can we consider that a motion? 00:07:45.740 --> 00:07:47.030 You can consider it amotion. 00:07:47.030 --> 00:07:48.790 Is there a second? I second. 00:07:48.790 --> 00:07:50.688 All in favor, say aye. Aye. 00:07:50.688 --> 00:07:51.521 Aye. Aye. 00:07:51.521 --> 00:07:52.373 Motion passes. 00:07:55.030 --> 00:07:57.360 Item number five please, sir. 00:07:57.360 --> 00:08:00.250 Item five is docket 51972. 00:08:00.250 --> 00:08:05.110 It's an agreed NLV-related to Centerpoint. 00:08:05.110 --> 00:08:08.987 Second revised proposed order was filed on September 15th. 00:08:08.987 --> 00:08:11.940 The ALJ filed a memo on September 16th 00:08:11.940 --> 00:08:14.633 accepting changes proposed by Centerpoint. 00:08:16.388 --> 00:08:18.203 Got another settlement. 00:08:23.480 --> 00:08:24.863 Thoughts, concerns? 00:08:32.330 --> 00:08:34.262 I hate to open, 00:08:34.262 --> 00:08:37.300 I appreciate when parties make the effort 00:08:37.300 --> 00:08:38.590 to try to settle. 00:08:38.590 --> 00:08:40.352 I think that's in the best interest 00:08:40.352 --> 00:08:42.620 of all parties involved. 00:08:42.620 --> 00:08:43.970 I struggle with this one a little bit 00:08:43.970 --> 00:08:46.893 because SAIDI and SAIFI are so important, 00:08:48.040 --> 00:08:50.420 especially in regions along the Gulf Coast. 00:08:50.420 --> 00:08:51.710 Especially when we don't really have 00:08:51.710 --> 00:08:56.233 a full record of when every customer was reconnected. 00:08:57.120 --> 00:09:01.040 Especially when I read the filings, 00:09:01.040 --> 00:09:03.320 I'm not sure that the request for information 00:09:03.320 --> 00:09:04.683 has been totally fulfilled. 00:09:05.790 --> 00:09:09.950 And I think that these are really, really 00:09:09.950 --> 00:09:12.140 important treatise. 00:09:12.140 --> 00:09:17.140 SAIDI, SAiFI, how we make sure that these individual Texans 00:09:17.440 --> 00:09:20.190 have their electricity and when it's cut off 00:09:20.190 --> 00:09:21.600 and when it's not cut off are really, 00:09:21.600 --> 00:09:23.550 really important issues. 00:09:23.550 --> 00:09:25.940 I know Centerpoint's gonna come back 00:09:25.940 --> 00:09:29.140 with the report here in a few months 00:09:29.140 --> 00:09:31.450 documenting a lot of vegetation management things, 00:09:31.450 --> 00:09:34.880 which I'm really, really eager to see, and other things. 00:09:34.880 --> 00:09:38.810 But I don't know, this one, 00:09:38.810 --> 00:09:43.180 it kind of scares me that it's not in the best interest 00:09:43.180 --> 00:09:45.390 right now and we need more information 00:09:45.390 --> 00:09:48.390 in order to make a more informed decision. 00:09:48.390 --> 00:09:50.100 Yeah, and I would dovetail on that. 00:09:50.100 --> 00:09:52.670 We tried to establish again, 00:09:52.670 --> 00:09:54.353 since the Commission was formed, 00:09:55.760 --> 00:09:56.900 with its current composition, 00:09:56.900 --> 00:09:58.930 we're trying to be consistent in asking 00:09:58.930 --> 00:10:03.930 for remediation plans so that we can gauge success here. 00:10:06.020 --> 00:10:07.890 And again, this is in a hurricane, 00:10:07.890 --> 00:10:10.160 it's in a vegetation-prone area of Texas 00:10:10.160 --> 00:10:11.351 so it keeps happening. 00:10:11.351 --> 00:10:13.760 So we need to see, what are you gonna do 00:10:13.760 --> 00:10:14.900 to ultimately fix this? 00:10:14.900 --> 00:10:19.140 Fines are fine but that's not how I gauge success. 00:10:19.140 --> 00:10:21.710 I gauge success as I don't ever wanna hear 00:10:21.710 --> 00:10:22.880 about this feeder again. 00:10:22.880 --> 00:10:23.713 And so- 00:10:26.111 --> 00:10:28.040 And the feeder is not in a rural area. 00:10:28.040 --> 00:10:31.470 It's in a very populated area so it does impact customers, 00:10:31.470 --> 00:10:33.100 a significant amount of customers. 00:10:33.100 --> 00:10:35.170 And I agree with your statement 00:10:35.170 --> 00:10:39.820 on the administrative penalties in that a $10,000 penalty, 00:10:39.820 --> 00:10:41.490 sometimes these penalties are basically 00:10:41.490 --> 00:10:44.600 just the cost of doing business and folks will pay out 00:10:44.600 --> 00:10:45.540 and keep going. 00:10:45.540 --> 00:10:50.010 But we wanna see remediation, correction, mitigation, 00:10:50.010 --> 00:10:53.590 so that issues are actually addressed and fixed. 00:10:53.590 --> 00:10:55.260 I think the one other thing that I would add 00:10:55.260 --> 00:10:58.560 is it is clear, it is a hurricane-prone area, 00:10:58.560 --> 00:10:59.729 high winds. 00:10:59.729 --> 00:11:04.591 I think they, CenterPoint, has done a good job 00:11:04.591 --> 00:11:06.290 in a lot of their system. 00:11:06.290 --> 00:11:08.090 If there are problem lines like this, 00:11:08.090 --> 00:11:10.163 we have to focus on these problem lines. 00:11:11.310 --> 00:11:14.000 As a business, you can't let one problem line 00:11:14.000 --> 00:11:17.490 skew your SAIDI and SAIFI of your whole system. 00:11:17.490 --> 00:11:19.420 You can't let that happen, guys. 00:11:19.420 --> 00:11:23.760 And I just, I recognize that they would be under 00:11:23.760 --> 00:11:25.610 or they would be in compliance with most 00:11:25.610 --> 00:11:28.040 of their SAIDI and SAIFI if it weren't for these storms 00:11:28.040 --> 00:11:29.700 and that's great. 00:11:29.700 --> 00:11:32.180 But we've gotta get these small ones cleared up 00:11:32.180 --> 00:11:34.400 because it means customers. 00:11:34.400 --> 00:11:36.530 Customers are inconvenienced. 00:11:36.530 --> 00:11:37.673 Or at least get us the plans 00:11:37.673 --> 00:11:41.210 so that we can gauge the costs on the system, or whatever. 00:11:41.210 --> 00:11:42.930 Just give us a plan. 00:11:42.930 --> 00:11:44.663 And right now that's, 00:11:44.663 --> 00:11:46.850 I think we're all singing the same sheet of music. 00:11:46.850 --> 00:11:49.450 That's what we're missing right now. 00:11:49.450 --> 00:11:50.673 With respect to the other violation 00:11:50.673 --> 00:11:53.640 and the 1102 customers and disconnection 00:11:53.640 --> 00:11:54.663 of those customers, 00:11:55.940 --> 00:11:58.940 the company had agreed to a $200,000 administrative penalty 00:11:58.940 --> 00:12:01.380 and also contributing to a charitable cause 00:12:01.380 --> 00:12:03.283 for low-income customers so I am comfortable 00:12:03.283 --> 00:12:05.230 with that path forward. 00:12:05.230 --> 00:12:07.090 It is the SAIDI and SAIFI violations 00:12:07.090 --> 00:12:08.590 that I think are the issue here, 00:12:08.590 --> 00:12:10.720 where we don't have enough information. 00:12:10.720 --> 00:12:11.553 Agreed. 00:12:12.957 --> 00:12:15.303 It sounds like there might be a motion to remand. 00:12:16.290 --> 00:12:18.320 I move to remand it 00:12:18.320 --> 00:12:19.720 for more information on the- 00:12:21.629 --> 00:12:22.620 Remediation plan. 00:12:22.620 --> 00:12:24.080 The remediation plan. 00:12:24.080 --> 00:12:25.600 Is there a second? Second. 00:12:25.600 --> 00:12:27.203 All in favor, say aye. Aye. 00:12:27.203 --> 00:12:28.630 Aye, motion passes. 00:12:28.630 --> 00:12:32.530 And I appreciate very much the focus 00:12:32.530 --> 00:12:34.580 that all of y'all have put on this issue. 00:12:35.600 --> 00:12:36.730 This is a problem we can solve 00:12:36.730 --> 00:12:38.130 before it becomes a problem. 00:12:40.570 --> 00:12:43.193 Item number six was consented. 00:12:44.400 --> 00:12:46.467 If item number seven and eight, 00:12:46.467 --> 00:12:48.120 are y'all gonna take those up? 00:12:48.120 --> 00:12:50.270 I would just say a couple of words on those 00:12:50.270 --> 00:12:51.823 and explain the path forward. 00:12:51.823 --> 00:12:53.900 I'll excuse myself. 00:12:53.900 --> 00:12:55.000 It'll be quick, sir. 00:12:56.370 --> 00:12:57.790 I was recused. 00:12:57.790 --> 00:13:02.790 So Chair takes up item 5232, 00:13:02.970 --> 00:13:05.043 can I take these up together- Yes sir. 00:13:05.043 --> 00:13:08.603 Okay, I'm gonna take up 52321 and 52322. 00:13:08.603 --> 00:13:13.220 And just for clarity for stakeholders, participants, 00:13:13.220 --> 00:13:15.920 and the broader public, on securitization, 00:13:15.920 --> 00:13:20.060 we now have a partial settlement filed 00:13:20.060 --> 00:13:22.523 in the docket on 52322. 00:13:25.270 --> 00:13:28.120 We also have the bones of what securitization 00:13:28.120 --> 00:13:29.713 might look like for 52321. 00:13:32.210 --> 00:13:34.190 I believe a bit, 00:13:34.190 --> 00:13:38.060 and again, that partial settlement came in this week. 00:13:38.060 --> 00:13:41.050 It seems prudent to have a little bit more time 00:13:41.050 --> 00:13:46.050 for staff to address the fine points and issues 00:13:46.890 --> 00:13:49.860 that were not covered, for the purposes of 52322 00:13:50.960 --> 00:13:55.320 in the partial settlement outline that was filed. 00:13:55.320 --> 00:13:57.193 And also, for the purposes of 52321, 00:13:58.810 --> 00:14:03.810 the $800 million securitization, we also have 00:14:03.940 --> 00:14:08.290 some outstanding refinements that could be made 00:14:08.290 --> 00:14:11.210 before a final order could be presented 00:14:11.210 --> 00:14:12.340 for our consideration. 00:14:12.340 --> 00:14:15.670 So with that, we have posted for a open meeting 00:14:15.670 --> 00:14:18.470 next week, September 30th. Yes, sir. 00:14:18.470 --> 00:14:21.983 And we could take this up at that time. 00:14:23.000 --> 00:14:26.830 In addition, sir, we were discussing posting 00:14:26.830 --> 00:14:29.340 additional open meetings on October 5th and 6th, 00:14:29.340 --> 00:14:32.032 just as a- Placeholders for, yes sir. 00:14:32.032 --> 00:14:32.865 In case they're needed. 00:14:32.865 --> 00:14:35.600 Yeah, we will not let the timeline slip on this, 00:14:35.600 --> 00:14:37.040 that's the ultimate goal. 00:14:37.040 --> 00:14:38.380 We wanna make sure the legislature 00:14:38.380 --> 00:14:40.630 and parties understand that. 00:14:40.630 --> 00:14:43.313 We just wanna get this right at the first cut. 00:14:44.630 --> 00:14:47.510 Absolutely and I support adding 00:14:47.510 --> 00:14:49.950 the extra open meetings to give staff 00:14:49.950 --> 00:14:53.680 more time to evaluate the bare bones, 00:14:53.680 --> 00:14:55.330 as Commissioner McAdams has talked about, 00:14:55.330 --> 00:14:58.840 in 52321, Subchapter M, securitization case 00:14:58.840 --> 00:15:00.720 and make sure that we have everything we need 00:15:00.720 --> 00:15:04.500 to make a decision on that case. 00:15:04.500 --> 00:15:07.873 And then with respect to 52322, Subchapter N, 00:15:09.494 --> 00:15:11.730 as you noted, we do have a partial settlement 00:15:11.730 --> 00:15:13.690 and we do need to give staff more time 00:15:13.690 --> 00:15:16.020 to evaluate the settlement. 00:15:16.020 --> 00:15:18.130 But we also need a weight on the supporting testimony 00:15:18.130 --> 00:15:19.780 that supports the settlement so that we have 00:15:19.780 --> 00:15:22.040 more information on the settlement 00:15:22.040 --> 00:15:24.740 to allow us to make a well-informed, holistic, 00:15:24.740 --> 00:15:25.713 robust decision. 00:15:27.664 --> 00:15:28.497 Yes, sir. I would say, 00:15:28.497 --> 00:15:29.492 I'd like more time to understand it as well, 00:15:29.492 --> 00:15:30.730 not just staff. 00:15:30.730 --> 00:15:32.900 It's complicated, it's confusing- 00:15:32.900 --> 00:15:34.883 You can just say that, I'll take more time too. 00:15:36.400 --> 00:15:39.260 We gotta get it right and it's important. 00:15:39.260 --> 00:15:41.810 We have to do it quickly, obviously, 00:15:41.810 --> 00:15:43.730 for the good of the market. 00:15:43.730 --> 00:15:46.240 But we gotta understand what we're voting on. 00:15:46.240 --> 00:15:47.190 It would be nice. 00:15:48.740 --> 00:15:50.240 And really, I mean, I do wanna say 00:15:50.240 --> 00:15:52.640 I appreciate the parties working towards a settlement. 00:15:52.640 --> 00:15:54.140 We asked them to do that 00:15:54.140 --> 00:15:56.080 and to all of you that were part of that, 00:15:56.080 --> 00:15:56.913 it's important. 00:15:58.290 --> 00:16:00.760 We appreciate you heeding that call 00:16:00.760 --> 00:16:02.923 and working towards the settlement. 00:16:03.810 --> 00:16:06.170 I would just like to say that one thing 00:16:06.170 --> 00:16:08.430 that has disrupted our timeline 00:16:09.491 --> 00:16:13.070 is it is taking more time than anyone might expect 00:16:13.070 --> 00:16:16.648 to figure out what issues have not been settled. 00:16:16.648 --> 00:16:20.750 And that's why, as parties file additional comments, 00:16:20.750 --> 00:16:23.420 again, trying to solve those issues 00:16:23.420 --> 00:16:25.440 that are not addressed in that partial settlement. 00:16:25.440 --> 00:16:28.220 I get it, those were the big ticket items 00:16:28.220 --> 00:16:30.490 but there are functional areas that we've gotta make sure 00:16:30.490 --> 00:16:31.720 we get right here. Yes, sir. 00:16:31.720 --> 00:16:32.830 I just baited the water. 00:16:32.830 --> 00:16:35.071 I don't think I'm gonna take my hook out. 00:16:35.071 --> 00:16:35.904 Yeah, I just added some to it. 00:16:35.904 --> 00:16:38.890 So if everybody's in agreement, 00:16:38.890 --> 00:16:42.170 we'll set aside items number seven and eight 00:16:42.170 --> 00:16:43.640 until next week. 00:16:43.640 --> 00:16:44.670 Agreed. Agreed. 00:16:44.670 --> 00:16:46.697 Mr. Chairman, I'll hand it back to you. 00:16:57.717 --> 00:17:00.260 All I heard was Journeay talking about baiting the water. 00:17:00.260 --> 00:17:02.893 That's enough for concern. That's his favorite pastime. 00:17:03.850 --> 00:17:05.247 You got your reel with you? 00:17:11.060 --> 00:17:11.893 All right. 00:17:11.893 --> 00:17:15.653 That brings us to item nine, which was consented. 00:17:17.266 --> 00:17:18.990 And have y'all taken up 10 00:17:18.990 --> 00:17:21.060 or you're not gonna take up 10? 00:17:21.060 --> 00:17:22.450 We did not take it up. We did not. 00:17:22.450 --> 00:17:23.860 We are not gonna take that up. 00:17:23.860 --> 00:17:25.043 Okay. 00:17:25.043 --> 00:17:29.310 Item 11 and 12, I don't have anything on those. 00:17:29.310 --> 00:17:30.330 Do y'all? 00:17:30.330 --> 00:17:31.413 No sir. Nope. 00:17:32.906 --> 00:17:37.120 That brings us to 13, regarding market performance 00:17:37.120 --> 00:17:37.953 this summer. 00:17:37.953 --> 00:17:40.540 I filed a memo on this earlier this summer, 00:17:40.540 --> 00:17:42.853 related to generator outage reporting. 00:17:46.600 --> 00:17:48.060 Jimmy hadn't joined us at that point 00:17:48.060 --> 00:17:50.800 but we directed ERCOT to make an outage 00:17:50.800 --> 00:17:53.770 and dereg reports available to the public 00:17:53.770 --> 00:17:57.720 within three days, instead of the standard 60 days, 00:17:57.720 --> 00:18:01.750 due to issues related to the June event. 00:18:01.750 --> 00:18:04.830 That order expires on September 30th 00:18:04.830 --> 00:18:08.334 and ERCOT is currently working through NPRRs 00:18:08.334 --> 00:18:12.073 to fulfill the order that we issued. 00:18:13.100 --> 00:18:17.243 But those won't be completed by September 30th. 00:18:18.080 --> 00:18:22.340 So I would proposed extending that June order 00:18:22.340 --> 00:18:24.390 to ensure that the public continues 00:18:24.390 --> 00:18:25.980 to have the same transparency 00:18:27.290 --> 00:18:30.510 on generator outages and deregs that have 00:18:30.510 --> 00:18:31.653 so far this summer. 00:18:32.730 --> 00:18:35.490 I think that transparency is important to the public. 00:18:35.490 --> 00:18:39.480 And while we have come through the summer months, 00:18:39.480 --> 00:18:41.430 as y'all know, the fall shoulder months 00:18:42.540 --> 00:18:44.490 still have their own unique challenges. 00:18:44.490 --> 00:18:49.450 And I know the public will still have 00:18:49.450 --> 00:18:51.963 a keen interest in that transparency. 00:18:54.140 --> 00:18:56.633 I'll open it up for thoughts or comments on that. 00:18:58.792 --> 00:19:00.621 Go ahead. Thank you, Chairman. 00:19:00.621 --> 00:19:02.980 I think that's a great point. 00:19:02.980 --> 00:19:04.786 With respect to the report, 00:19:04.786 --> 00:19:07.440 as we enter into the shoulder months, 00:19:07.440 --> 00:19:11.180 there will be generation down to get, maintain 00:19:11.180 --> 00:19:13.020 for the winter, to go through the maintenance outages. 00:19:13.020 --> 00:19:15.570 So in the report, would that include 00:19:16.720 --> 00:19:21.640 just D rates and plants that are forced out or both? 00:19:23.610 --> 00:19:26.620 It would be the exact same order as in June 00:19:26.620 --> 00:19:29.967 of just forced outages and deregs. 00:19:29.967 --> 00:19:31.420 It would just change the timeline. 00:19:31.420 --> 00:19:35.490 I think ERCOT's got, they already have a pretty robust 00:19:35.490 --> 00:19:38.670 planned outage program. 00:19:38.670 --> 00:19:39.970 We've made changes to that 00:19:41.571 --> 00:19:42.780 and ERCOT has not, since the winter, 00:19:42.780 --> 00:19:46.170 ERCOT has more control over those planned outages 00:19:46.170 --> 00:19:49.360 and adjusting those to ensure reliability. 00:19:49.360 --> 00:19:52.550 So this would just be focused on forced outages, 00:19:52.550 --> 00:19:55.100 simply changing the dates 00:19:55.100 --> 00:19:59.493 from having that order expire on September 30th. 00:20:01.560 --> 00:20:06.210 And this would just make that same exact order 00:20:06.210 --> 00:20:09.860 effective from October 1st through May 31st of 2022. 00:20:12.930 --> 00:20:14.800 Just to correct, Chairman, 00:20:14.800 --> 00:20:17.680 the order does speak to maintenance level outages. 00:20:17.680 --> 00:20:18.700 Oh, it does, as well. 00:20:18.700 --> 00:20:20.210 Oh, well, there you go. 00:20:20.210 --> 00:20:21.043 Sorry. 00:20:21.043 --> 00:20:22.520 I'm sorry, it speaks to? 00:20:22.520 --> 00:20:26.133 Maintenance level outage information. 00:20:27.050 --> 00:20:32.050 I think this is a good vote, a good yes. 00:20:34.515 --> 00:20:36.460 It's pretty big market information, 00:20:36.460 --> 00:20:38.240 especially when we're so short on capacity. 00:20:38.240 --> 00:20:40.680 And I think it's important to get it out there quickly, 00:20:40.680 --> 00:20:43.960 as opposed to 60 days later. 00:20:43.960 --> 00:20:47.130 A lot of things can happen in 60 days with generating units 00:20:47.130 --> 00:20:50.290 and we oughta make sure that the public 00:20:50.290 --> 00:20:52.870 and the market knows what's happening as quick as possible. 00:20:52.870 --> 00:20:55.300 I applaud ERCOT for trying to make the changes 00:20:55.300 --> 00:20:57.170 as quick as they can and this order 00:20:57.170 --> 00:21:00.280 is kind of a stop-gap measure to make sure 00:21:00.280 --> 00:21:04.494 that we have a continuity of service in what we're doing. 00:21:04.494 --> 00:21:05.640 Indeed. 00:21:05.640 --> 00:21:08.240 To dovetail on that, I believe it is consistent, 00:21:08.240 --> 00:21:11.770 this approach as a stop-gap, a bridge, 00:21:11.770 --> 00:21:15.340 to what may be considered market design, 00:21:15.340 --> 00:21:17.770 as we have that conversation in October. 00:21:17.770 --> 00:21:21.310 So this is widely considered by the public, 00:21:21.310 --> 00:21:24.240 by policymakers to be, as of right now, 00:21:24.240 --> 00:21:25.330 a successful policy. 00:21:25.330 --> 00:21:27.110 Stakeholders will be able to, 00:21:27.110 --> 00:21:28.980 once we outline a blueprint. 00:21:28.980 --> 00:21:30.430 And if it does touch on this, 00:21:30.430 --> 00:21:33.010 we'll be able to speak to an overarching policy 00:21:33.010 --> 00:21:34.160 moving forward. 00:21:34.160 --> 00:21:36.710 But for the time being, as we again bridge through shoulder, 00:21:36.710 --> 00:21:40.313 which is always tense, at least from my standpoint, 00:21:41.680 --> 00:21:44.160 this helps in terms of transparency 00:21:44.160 --> 00:21:46.670 and pressure on those resources again 00:21:46.670 --> 00:21:48.290 and shareholders to do the right thing. 00:21:48.290 --> 00:21:50.717 So I would support it. 00:21:50.717 --> 00:21:54.310 And yes, I absolutely support the continued transparency 00:21:54.310 --> 00:21:55.143 going forward. 00:21:55.143 --> 00:21:56.730 I think it is important for the public, 00:21:56.730 --> 00:21:58.700 for the policymakers, for us, as we work 00:21:58.700 --> 00:21:59.990 through market design. 00:21:59.990 --> 00:22:03.253 And I do believe it is important that ERCOT. 00:22:04.665 --> 00:22:06.710 I'm glad to hear that ERCOT is introduced NPRRs 00:22:06.710 --> 00:22:09.060 to set a more permanent framework 00:22:09.060 --> 00:22:11.210 to provide that transparency to the public. 00:22:15.170 --> 00:22:17.333 All right, thank you all for the comments. 00:22:18.268 --> 00:22:21.630 At this point, I'd entertain a motion 00:22:21.630 --> 00:22:22.820 to issue a new order. 00:22:22.820 --> 00:22:23.860 ERCOT making the order 00:22:23.860 --> 00:22:25.470 in paragraphs one, two, and four 00:22:25.470 --> 00:22:27.563 of our June 30th order. 00:22:28.593 --> 00:22:31.620 And this docket effective from October 1, 2021 00:22:31.620 --> 00:22:35.110 through May 31, 2022. So moved. 00:22:35.110 --> 00:22:37.250 Second. All in favor, say aye. 00:22:37.250 --> 00:22:38.160 Aye. Aye. 00:22:38.160 --> 00:22:39.053 Motion passes. 00:22:41.050 --> 00:22:44.100 That will bring us to item number 14, 00:22:44.100 --> 00:22:46.630 regarding the Texas Entergy Reliability Council 00:22:47.470 --> 00:22:48.773 and its membership. 00:22:49.970 --> 00:22:51.700 I know our executive director filed a memo 00:22:51.700 --> 00:22:53.200 on this project. 00:22:53.200 --> 00:22:54.640 Mr. Gleeson, would you and your staff 00:22:54.640 --> 00:22:57.180 like to provide some background on your memo? 00:22:57.180 --> 00:23:00.330 Sure, thank you, Mr. Chairman, Commissioners. 00:23:00.330 --> 00:23:03.250 So we, in this project, filed instructions 00:23:03.250 --> 00:23:06.740 for those interested in being a part of TURK. 00:23:06.740 --> 00:23:09.640 To apply, what we're asking for is a letter of intent, 00:23:09.640 --> 00:23:12.810 for a resume, and for a letter of recommendation. 00:23:12.810 --> 00:23:16.270 This closely mirrors what we do in our RFP process 00:23:16.270 --> 00:23:19.530 and that's the example we use to set this. 00:23:19.530 --> 00:23:22.210 The only thing I would add is we want 00:23:22.210 --> 00:23:23.760 to work on an expedited timeline 00:23:23.760 --> 00:23:25.880 so I'd ask if they're interested, 00:23:25.880 --> 00:23:29.740 file their application by next Friday. 00:23:29.740 --> 00:23:33.100 And my goal would be to have a selection 00:23:33.100 --> 00:23:34.670 for all of the eight spots, 00:23:34.670 --> 00:23:36.723 by the end of the following week. 00:23:37.710 --> 00:23:39.120 Like so many things around here, 00:23:39.120 --> 00:23:41.120 a very aggressive timeline. Yes, sir. 00:23:42.653 --> 00:23:46.170 Appreciate the expediency 00:23:46.170 --> 00:23:48.170 with which you're undertaking this. 00:23:48.170 --> 00:23:50.683 Any comments, questions for Mr. Gleeson? 00:23:51.600 --> 00:23:52.433 No, sir. 00:23:54.100 --> 00:23:54.933 No, sir. 00:23:56.010 --> 00:23:56.843 All right. 00:23:56.843 --> 00:23:57.960 Is there a motion to approve 00:23:57.960 --> 00:24:00.420 the order filed with Mr. Gleeson, September 16th. 00:24:00.420 --> 00:24:02.320 Memo authorizing a delegation of authority 00:24:02.320 --> 00:24:04.260 to the executive director takes necessary action 00:24:04.260 --> 00:24:07.530 to make appointments to the Texas Energy Liability Council? 00:24:07.530 --> 00:24:09.580 So moved. Second. 00:24:09.580 --> 00:24:10.770 All in favor, say aye. 00:24:10.770 --> 00:24:11.710 Aye. 00:24:11.710 --> 00:24:12.550 Motion passes. 00:24:12.550 --> 00:24:13.383 Thank you. 00:24:15.220 --> 00:24:19.550 Don't have anything on item 15, do y'all? 00:24:19.550 --> 00:24:21.161 No sir. All right. 00:24:21.161 --> 00:24:22.193 Nope. Good. 00:24:23.270 --> 00:24:28.270 That will bring us to item number 16, project 52373, 00:24:28.380 --> 00:24:31.283 regarding wholesale electric market design. 00:24:32.960 --> 00:24:35.610 Commissioner McAdams filed a memo, two memos on this. 00:24:40.420 --> 00:24:41.980 Before I'd ask you to address those, 00:24:41.980 --> 00:24:44.450 I'd offer some comments and thoughts 00:24:44.450 --> 00:24:48.030 to our broader stakeholder community 00:24:48.030 --> 00:24:51.210 that I think reflects the general sentiment 00:24:51.210 --> 00:24:52.870 of this Commission. 00:24:52.870 --> 00:24:56.010 We have been, and you all have been, 00:24:56.010 --> 00:25:00.113 part of an extraordinary stakeholder process to date, 00:25:01.160 --> 00:25:03.560 throughout the summer, and will continue to be. 00:25:03.560 --> 00:25:06.100 So we as a Commission are very grateful, and the staff, 00:25:06.100 --> 00:25:09.230 for all the effort and resources that have been expended 00:25:09.230 --> 00:25:10.870 on that. 00:25:10.870 --> 00:25:12.930 We got a lot of good feedback. 00:25:12.930 --> 00:25:14.480 We've had a lot of good discussions 00:25:14.480 --> 00:25:17.180 in these work sessions and it's been a lot 00:25:17.180 --> 00:25:20.420 of work for everybody involved, including our staff 00:25:20.420 --> 00:25:23.130 and our Commissioners and their staffs. 00:25:23.130 --> 00:25:26.210 We've got a lot of good input and insight 00:25:26.210 --> 00:25:28.640 on new ancillary services products, 00:25:28.640 --> 00:25:32.790 the scarcity pricing at ORDC, MCL, et cetera. 00:25:32.790 --> 00:25:35.170 And all of which this Commission will consider 00:25:35.170 --> 00:25:39.670 and I suspect will take action on some, 00:25:39.670 --> 00:25:44.670 if not all of the above, once we get to our final blueprint 00:25:45.440 --> 00:25:46.910 in December. 00:25:46.910 --> 00:25:48.360 But I would ask our stakeholder community 00:25:48.360 --> 00:25:49.450 to not stop there. 00:25:49.450 --> 00:25:54.050 If we stop there, I think we run the risk 00:25:54.050 --> 00:25:56.990 of putting band-aids on bullet holes. 00:25:56.990 --> 00:26:00.050 Senate Bill three asks us to not only address 00:26:01.010 --> 00:26:03.310 ancillary services and look at additional products 00:26:03.310 --> 00:26:06.060 that could be used to enhance reliability 00:26:06.060 --> 00:26:07.420 in the ERCOT marketplace 00:26:07.420 --> 00:26:11.330 but it also asks us to ensure broader reliability 00:26:11.330 --> 00:26:15.010 in the ERCOT marketplace, in addition to above 00:26:15.010 --> 00:26:17.950 and beyond just those ancillary services 00:26:17.950 --> 00:26:19.250 and similar type products. 00:26:20.415 --> 00:26:22.150 So I would ask our stakeholder community 00:26:22.150 --> 00:26:27.150 to think about the substantial changes 00:26:27.860 --> 00:26:31.230 to the normal functioning of the ERCOT market 00:26:32.500 --> 00:26:35.760 in a normal day and a normal course of business 00:26:35.760 --> 00:26:39.300 that will ensure that the revenues and the economics 00:26:39.300 --> 00:26:43.280 of the ERCOT model go to generating resources 00:26:43.280 --> 00:26:46.840 that provide reliable power of any form or fashion. 00:26:46.840 --> 00:26:51.428 And so that companies and entities 00:26:51.428 --> 00:26:55.750 that reliably provide power to Texas 00:26:56.730 --> 00:27:00.470 can run a reasonably profitable business 00:27:00.470 --> 00:27:01.940 under normal conditions. 00:27:01.940 --> 00:27:04.010 They don't need a scarcity event 00:27:04.010 --> 00:27:07.220 or a crisis to generate reasonable returns 00:27:07.220 --> 00:27:08.220 for their investors. 00:27:10.210 --> 00:27:15.210 Right now, the current market framework 00:27:15.260 --> 00:27:20.260 seems to put reliability risks in the ERCOT control room. 00:27:21.070 --> 00:27:25.293 If a unit trips or weather conditions change, 00:27:26.460 --> 00:27:28.560 the folks in the ERCOT control room 00:27:28.560 --> 00:27:31.410 are responsible for continuing to serve load. 00:27:31.410 --> 00:27:33.670 As part of the normal functioning of the ERCOT market, 00:27:33.670 --> 00:27:35.120 I think we'd like to see that risk 00:27:35.120 --> 00:27:36.800 moved out into the marketplace. 00:27:36.800 --> 00:27:41.500 That has the financial tools and risk management 00:27:41.500 --> 00:27:44.320 capabilities to better handle that kind of risk 00:27:44.320 --> 00:27:47.961 and where the rewards for mitigating that risk 00:27:47.961 --> 00:27:50.980 are available. 00:27:50.980 --> 00:27:52.850 That could be on the gen side, the load side, 00:27:52.850 --> 00:27:54.110 some combination thereof. 00:27:54.110 --> 00:27:56.400 We've already seen a lot of suggestions that address that. 00:27:56.400 --> 00:27:59.500 So this is just a reminder to our stakeholders 00:27:59.500 --> 00:28:03.310 that as you move, from now until the submissions 00:28:03.310 --> 00:28:05.830 outlined in Connie's memo, I think September 30th- 00:28:05.830 --> 00:28:06.663 Yes, sir. 00:28:07.760 --> 00:28:09.230 Please, please think big. 00:28:09.230 --> 00:28:12.860 Please think about wholesale changes 00:28:12.860 --> 00:28:17.860 that will provide revenues to reliable power 00:28:19.370 --> 00:28:23.790 and normal market function without requiring 00:28:23.790 --> 00:28:28.053 a crisis, without requiring scarcity. 00:28:28.920 --> 00:28:32.130 So that's simply my ask of our stakeholders 00:28:32.130 --> 00:28:34.860 as they move towards that September 30th deadline. 00:28:34.860 --> 00:28:37.380 Commissioner McAdams, I know you've filed some memos 00:28:37.380 --> 00:28:39.430 on this so I'll turn it over to you at this point. 00:28:39.430 --> 00:28:40.500 Thank you, sir. 00:28:40.500 --> 00:28:44.530 And let me start off by saying that the memos 00:28:44.530 --> 00:28:49.520 were filed with an interest of not only market certainty 00:28:49.520 --> 00:28:52.920 but to assuage consumer concerns 00:28:52.920 --> 00:28:56.003 as we head into the winter of 2022. 00:28:57.633 --> 00:29:02.410 And to set in place a system of safeguards 00:29:02.410 --> 00:29:06.000 that both the market participants can count on 00:29:06.000 --> 00:29:09.660 but the consumers, the residential consumers 00:29:09.660 --> 00:29:11.110 that are gonna receive bills. 00:29:12.550 --> 00:29:16.560 Uri was traumatizing, we recognize that. 00:29:16.560 --> 00:29:20.630 The next winter after Uri will be remembered 00:29:20.630 --> 00:29:22.990 by consumers of all classes. 00:29:22.990 --> 00:29:26.450 And so my memos were limited in scope 00:29:26.450 --> 00:29:28.340 and as I said in my memo, 00:29:28.340 --> 00:29:30.890 this isn't market redesign, this is market design. 00:29:30.890 --> 00:29:33.300 These are aspects of our market design 00:29:33.300 --> 00:29:36.460 that are sitting there that everyone in this room 00:29:36.460 --> 00:29:40.770 is accustomed to seeing and debating change to. 00:29:40.770 --> 00:29:43.480 But with that, one of the components is clearly 00:29:43.480 --> 00:29:44.410 in our rule. 00:29:44.410 --> 00:29:48.010 A lot of things hinge on the value of lost load, 00:29:48.010 --> 00:29:52.987 the high cap that is in TAC 25.505. 00:29:55.070 --> 00:29:59.903 In order to address ORDC substantively, 00:30:01.170 --> 00:30:04.200 which is the basis of, I think it's fair to say 00:30:04.200 --> 00:30:05.380 hundreds of comments. 00:30:05.380 --> 00:30:10.380 If you screen several dockets that we've opened, 00:30:10.510 --> 00:30:12.860 consistently, stakeholders have said 00:30:12.860 --> 00:30:16.560 that the high cap should change. 00:30:16.560 --> 00:30:20.670 That $9000 was almost universally critiqued 00:30:20.670 --> 00:30:25.670 as being high, given the depth of the load shed 00:30:26.120 --> 00:30:30.610 and the length of the duration of the period of Uri. 00:30:30.610 --> 00:30:35.290 And so I would pare my memo back and what I'm asking for 00:30:35.290 --> 00:30:40.290 in the interest of a fast-moving rulemaking 00:30:40.850 --> 00:30:42.960 to where we could lower the high cap 00:30:44.110 --> 00:30:46.283 for the purposes of 2022. 00:30:47.150 --> 00:30:49.920 And again, that would dovetail naturally 00:30:49.920 --> 00:30:51.840 into the proceedings that we are taking up 00:30:51.840 --> 00:30:54.080 as a part of the redesigned blueprint, 00:30:54.080 --> 00:30:56.550 which this Commission will consider. 00:30:56.550 --> 00:30:59.090 Again, lowering the high cap is not, 00:30:59.090 --> 00:31:02.030 in and of itself, the answer and will not be 00:31:02.030 --> 00:31:04.890 the only thing to be imposed for 2021. 00:31:04.890 --> 00:31:06.760 But for the purposes of our rules, 00:31:06.760 --> 00:31:08.330 we must change that in order 00:31:08.330 --> 00:31:11.120 to substantively effect everything else. 00:31:11.120 --> 00:31:14.940 And so I propose that we open this rulemaking 00:31:14.940 --> 00:31:19.730 to only change that $9000 number and, 00:31:19.730 --> 00:31:20.640 if appropriate, 00:31:20.640 --> 00:31:25.070 so that again, having conferred with staff, 00:31:25.070 --> 00:31:28.150 the way rulemaking should proceed is staff 00:31:28.150 --> 00:31:29.830 would file a redline. 00:31:29.830 --> 00:31:32.320 And again, then we would adopt that redline 00:31:32.320 --> 00:31:34.270 to go out for comment. 00:31:34.270 --> 00:31:38.000 So in order to match that up with our schedule 00:31:38.000 --> 00:31:41.910 to enact these changes quickly, 00:31:41.910 --> 00:31:44.740 conforming to the comment requirements, 00:31:44.740 --> 00:31:47.123 we only have a couple of dates on the schedule. 00:31:48.450 --> 00:31:52.970 September 30th would not be in time 00:31:52.970 --> 00:31:56.380 because frankly, I need to propose a number here 00:31:56.380 --> 00:31:58.130 that can then go into redline. 00:31:58.130 --> 00:31:59.570 And I'm looking at Connie and Thomas 00:31:59.570 --> 00:32:01.120 to make sure all this jives, 00:32:01.120 --> 00:32:04.390 that we can then vote on to move forward in the process 00:32:04.390 --> 00:32:07.030 so that stakeholder comment can be received. 00:32:07.030 --> 00:32:11.433 So just as a kind of whiteboard in words here, 00:32:12.600 --> 00:32:17.600 I would propose a number at 4500 right now 00:32:18.830 --> 00:32:21.520 to supplement the 9000 as a placeholder- 00:32:21.520 --> 00:32:22.770 To reduce from 9000. 00:32:22.770 --> 00:32:25.890 Reduce from 9000 down to 4500, cut it in half, 00:32:25.890 --> 00:32:29.660 and then let stakeholders tell us why I am wrong. 00:32:29.660 --> 00:32:32.510 And then let's see- 00:32:32.510 --> 00:32:33.380 Do you think you'll get comments? 00:32:33.380 --> 00:32:34.491 I think I'm gonna get comments. 00:32:34.491 --> 00:32:35.324 I don't think so. 00:32:35.324 --> 00:32:36.223 I'll bet you won't. 00:32:39.340 --> 00:32:42.260 We could adopt that at the October 7th open meeting 00:32:43.850 --> 00:32:46.210 with an abbreviated comment period for, 00:32:46.210 --> 00:32:48.320 and again, everybody's filed comments on this, 00:32:48.320 --> 00:32:50.730 I mean, everybody's done studies, 00:32:50.730 --> 00:32:53.800 for October 14th, which lines up very well, 00:32:53.800 --> 00:32:56.210 Mr. Chairman, with the redesign effort 00:32:56.210 --> 00:32:58.790 and those decisions that would 00:32:58.790 --> 00:33:02.791 move forward concurrent to that on ORDC or anything else. 00:33:02.791 --> 00:33:05.870 When would you ask stakeholders to have their, 00:33:05.870 --> 00:33:09.460 I guess, final, final comments on high cap 00:33:09.460 --> 00:33:11.650 into the Commission for consideration? 00:33:11.650 --> 00:33:13.930 Well, I'd look to Connie on that. 00:33:13.930 --> 00:33:16.020 My non-negotiable is to get this in place 00:33:16.020 --> 00:33:17.773 for January 1. 00:33:18.890 --> 00:33:20.060 Would it sync with this? 00:33:20.060 --> 00:33:21.250 I mean, they've got comments coming in 00:33:21.250 --> 00:33:22.243 on September 30th anyway- 00:33:22.243 --> 00:33:24.129 I know, on the study. 00:33:24.129 --> 00:33:25.400 On the market reliability. 00:33:25.400 --> 00:33:27.419 The reason I didn't line it up 00:33:27.419 --> 00:33:28.500 with September 30th is because I have 00:33:28.500 --> 00:33:30.840 to get staff to put out that redline 00:33:30.840 --> 00:33:33.122 and then we come back and adopt it. 00:33:33.122 --> 00:33:33.955 We have to vote on that portion, 00:33:33.955 --> 00:33:36.510 which starts the clock. 00:33:36.510 --> 00:33:37.747 So that would be- 00:33:37.747 --> 00:33:38.977 The October 7th. 00:33:42.670 --> 00:33:45.480 So would it be manageable 00:33:45.480 --> 00:33:49.500 to having stated, what I think, 00:33:49.500 --> 00:33:51.300 is a reasonable starting point 00:33:51.300 --> 00:33:55.340 for a revised high cap of 4500, 00:33:55.340 --> 00:33:58.225 would it be manageable to let stakeholders provide feedback 00:33:58.225 --> 00:34:00.070 if, I mean we can have that discussion 00:34:00.070 --> 00:34:01.040 on what that number looks like, 00:34:01.040 --> 00:34:02.600 provide feedback on that number 00:34:02.600 --> 00:34:05.820 before we start the clock running on a proposed rule, 00:34:05.820 --> 00:34:08.170 get their feedback by September 30th 00:34:09.201 --> 00:34:11.890 and then we can do the redline after we see 00:34:11.890 --> 00:34:12.790 what they've said? 00:34:14.010 --> 00:34:15.340 I think we have to do the redline 00:34:15.340 --> 00:34:17.243 in order to get this thing moving. 00:34:18.158 --> 00:34:19.830 I don't know. We could proceed 00:34:19.830 --> 00:34:22.230 in either path. 00:34:22.230 --> 00:34:26.772 Y'all could agree on a starting point number today- 00:34:26.772 --> 00:34:28.690 I'll do that. And we could bring a redline 00:34:28.690 --> 00:34:33.690 to you before the October 7th open meeting. 00:34:33.760 --> 00:34:37.520 Alternatively, you could give a few days, 00:34:37.520 --> 00:34:42.040 a week between now and then, for input into what 00:34:42.040 --> 00:34:43.990 that number should be. 00:34:43.990 --> 00:34:46.240 So input between now and then could just be 00:34:47.730 --> 00:34:50.060 filed under one of the projects, 00:34:50.060 --> 00:34:52.190 a project open per Will's memo? 00:34:52.190 --> 00:34:53.640 Yes. And that satisfies 00:34:53.640 --> 00:34:56.110 the legal requirement for comment as we move forward. 00:34:56.110 --> 00:34:58.020 I just don't want it to get delayed 00:34:58.020 --> 00:35:00.000 so that we don't have implementation uncertainty 00:35:00.000 --> 00:35:01.310 for consumers by January. 00:35:01.310 --> 00:35:04.730 Anything that happens prior to us, 00:35:04.730 --> 00:35:07.220 prior to y'all voting on a redline 00:35:07.220 --> 00:35:09.310 is entirely discretionary. 00:35:09.310 --> 00:35:11.417 Okay. That's right. 00:35:11.417 --> 00:35:15.255 And I thank you, Will, for the leadership on that issue. 00:35:15.255 --> 00:35:18.406 Having been representing the residential consumers 00:35:18.406 --> 00:35:20.730 through this winter storm Uri, 00:35:20.730 --> 00:35:24.817 it was a very traumatizing event to actually work 00:35:27.000 --> 00:35:28.790 firsthand with the residential consumers 00:35:28.790 --> 00:35:30.320 throughout that storm. 00:35:30.320 --> 00:35:32.870 And there are a number of issues that I think need 00:35:32.870 --> 00:35:34.360 to be addressed before the storm, 00:35:34.360 --> 00:35:37.580 before the anniversary and this is one of 'em, 00:35:37.580 --> 00:35:38.413 the price cap. 00:35:38.413 --> 00:35:39.950 Although it doesn't translate directly 00:35:39.950 --> 00:35:42.380 to residential bills, and it won't 00:35:42.380 --> 00:35:46.200 because HB16 was passed and it bans 00:35:46.200 --> 00:35:48.320 the wholesale price index plans 00:35:48.320 --> 00:35:51.270 that were provided to residential and small commercial 00:35:51.270 --> 00:35:52.984 consumers during the storm. 00:35:52.984 --> 00:35:57.003 But it's still important to lower that cap, 00:35:57.900 --> 00:35:59.640 for a variety of other reasons 00:35:59.640 --> 00:36:03.730 and I support doing that in the most efficient manner 00:36:03.730 --> 00:36:07.100 but also to get the feedback that we need 00:36:08.390 --> 00:36:10.110 from the stakeholders on 4500. 00:36:10.110 --> 00:36:12.350 Which we have hd a lot of stakeholders file 00:36:13.420 --> 00:36:15.050 comments supporting 4500, 00:36:15.050 --> 00:36:18.480 but I just wanna make sure that we get that feedback. 00:36:18.480 --> 00:36:20.380 And I'm good with either way, 00:36:20.380 --> 00:36:22.230 whether we get the feedback up front. 00:36:23.130 --> 00:36:26.010 We could get it submitted in 52373. 00:36:26.010 --> 00:36:27.670 We could get it submitted in a new project 00:36:27.670 --> 00:36:30.040 that Commissioner McAdams wants to open 00:36:30.040 --> 00:36:35.040 on ORDC specifically and get information 00:36:35.140 --> 00:36:36.370 and then get the redline going, 00:36:36.370 --> 00:36:38.730 because the clock doesn't start until the PFP, 00:36:38.730 --> 00:36:40.920 the redline, we vote on the PFP. 00:36:40.920 --> 00:36:42.560 So either way is good with me. 00:36:42.560 --> 00:36:46.850 I think we're gonna meet the by the end of the year, 00:36:46.850 --> 00:36:49.203 January deadline with either approach. 00:36:50.530 --> 00:36:52.810 So let me make sure I've got the context 00:36:52.810 --> 00:36:53.877 of what you're laying out, 00:36:53.877 --> 00:36:55.800 and especially for the public. 00:36:55.800 --> 00:36:57.890 Since the winter event Uri, 00:36:57.890 --> 00:37:01.630 the high cap in the ERCOT market was moved 00:37:01.630 --> 00:37:04.290 from 9000 to 2000. That's correct, sir. 00:37:04.290 --> 00:37:05.431 So throughout the summer, 00:37:05.431 --> 00:37:08.140 the high cap price in the ERCOT market 00:37:08.140 --> 00:37:11.590 has been 2000, based on existing rules. 00:37:11.590 --> 00:37:14.270 Those rules that will, based on the existing rules, 00:37:14.270 --> 00:37:19.270 that $2000 mark will move back up to 9000 on January 1st, 00:37:20.030 --> 00:37:22.240 which I think is, from my understanding- 00:37:22.240 --> 00:37:24.520 That's why it's so pressing to address it in my mind. 00:37:24.520 --> 00:37:25.353 Agreed. 00:37:25.353 --> 00:37:29.609 And so the driving focus of your initiative here is to, 00:37:29.609 --> 00:37:34.609 and part of your concern with the, 00:37:34.990 --> 00:37:37.860 obviously protecting the Texas consumers, 00:37:37.860 --> 00:37:41.430 both businesses and residential customers, 00:37:41.430 --> 00:37:45.040 this initiative is to make sure that by January 1st, 00:37:45.040 --> 00:37:47.100 instead of going back to the 9000, 00:37:47.100 --> 00:37:48.860 which we've generally heard from the public 00:37:48.860 --> 00:37:51.033 and our stakeholders is too high, 00:37:51.920 --> 00:37:56.030 this project will be an accelerated version 00:37:56.030 --> 00:37:59.523 of moving that high cap down through our Rule 25.505, 00:37:59.523 --> 00:38:01.573 a very narrow scope of that. Yes, sir. 00:38:03.360 --> 00:38:07.610 So that we can ensure Texans won't be charged $9000 00:38:07.610 --> 00:38:09.250 in the event of another scarcity- 00:38:09.250 --> 00:38:11.243 Event. Crisis. 00:38:12.780 --> 00:38:13.880 We don't know what the number will be. 00:38:13.880 --> 00:38:17.120 You're proposing a 4500, a 50% reduction 00:38:17.120 --> 00:38:19.880 from the old high cap for consumers. 00:38:19.880 --> 00:38:24.880 So that's a substantial reduction in potential liability 00:38:25.410 --> 00:38:27.553 for Texas consumers. 00:38:29.690 --> 00:38:32.902 And as part of that, from what I understand, 00:38:32.902 --> 00:38:37.902 you're making a narrow focus in an accelerated rulemaking 00:38:38.290 --> 00:38:43.210 so that it syncs with our broader market redesign blueprint, 00:38:43.210 --> 00:38:45.114 so that those can go, 00:38:45.114 --> 00:38:50.114 that we can open and close 25.505, have the rule in place, 00:38:51.880 --> 00:38:54.727 have the new high cap in place before January 1st 00:38:54.727 --> 00:38:58.790 and still have that rule available to us 00:38:58.790 --> 00:39:00.916 for the broader blueprint. 00:39:00.916 --> 00:39:01.749 Yes, sir. 00:39:01.749 --> 00:39:02.990 Okay, yep. 00:39:02.990 --> 00:39:04.077 I just wanna make sure to lay it out, 00:39:04.077 --> 00:39:05.050 I got everything. 00:39:05.050 --> 00:39:06.660 Can I ask one clarifying question 00:39:06.660 --> 00:39:09.110 or make one clarification point? 00:39:09.110 --> 00:39:11.710 So in our rule, there's the high cap, 00:39:11.710 --> 00:39:13.307 there's the systemwide upper cap, 00:39:13.307 --> 00:39:15.010 and there's the value of lost load. 00:39:15.010 --> 00:39:16.010 Right. 00:39:16.010 --> 00:39:19.600 So when you say changing the high cap, 00:39:19.600 --> 00:39:22.280 will that change to the high cap also result, 00:39:22.280 --> 00:39:24.590 are we still going to have the same number 00:39:24.590 --> 00:39:26.890 for the systemwide upper cap and the value of lost load 00:39:26.890 --> 00:39:28.750 because the value of lost load is what's included 00:39:28.750 --> 00:39:29.583 in ORDC. 00:39:31.050 --> 00:39:32.000 Go ahead. 00:39:32.000 --> 00:39:33.800 I was just gonna say, that's my understanding. 00:39:33.800 --> 00:39:35.730 Until we do the studies to determine 00:39:35.730 --> 00:39:39.105 what the best value of lost load is, which- 00:39:39.105 --> 00:39:41.100 Well, thankfully, lots of stakeholders 00:39:41.100 --> 00:39:43.040 are doing studies for us- That's for sure. 00:39:43.040 --> 00:39:45.990 To accommodate our accelerated timeline. 00:39:45.990 --> 00:39:48.130 As per the rule, Commissioner Cobos, 00:39:48.130 --> 00:39:51.980 two numbers are specified in relation to high cap. 00:39:51.980 --> 00:39:54.920 And again, that's $9000 twice. 00:39:54.920 --> 00:39:58.963 And so, and again, right now value of lost load, 00:40:00.648 --> 00:40:02.300 that's kind of why I asked that question, 00:40:02.300 --> 00:40:05.130 should we specify VOLL in rule? 00:40:05.130 --> 00:40:08.530 I don't think so because my initial thought is no 00:40:08.530 --> 00:40:11.110 because the whole action that we were able 00:40:11.110 --> 00:40:14.990 to take with ORDC and being nimble with making those changes 00:40:14.990 --> 00:40:18.247 would now require a rule change if we put VOLL in rule. 00:40:18.247 --> 00:40:20.110 Right. But I do wanna point out 00:40:21.163 --> 00:40:24.937 that in 25.505, subsection G, 6e, 00:40:27.140 --> 00:40:29.020 it says the value of lost load will equal 00:40:29.020 --> 00:40:31.570 to the value of the systemwide upper cap in effect. 00:40:34.400 --> 00:40:36.000 Exactly, yes, yes. 00:40:36.000 --> 00:40:38.650 Okay, so- Which one's setting which? 00:40:38.650 --> 00:40:42.663 Well, that's why that 9000 specification is so important. 00:40:44.429 --> 00:40:46.333 Everything moves off of that. 00:40:47.330 --> 00:40:50.210 Okay, so we're going to get comment 00:40:50.210 --> 00:40:51.553 on the HCAP and the systemwide upper cap. 00:40:52.850 --> 00:40:56.397 We're thinking of them as the same figure? 00:40:56.397 --> 00:40:57.500 Yes. Okay. 00:40:57.500 --> 00:40:58.850 As of right now. Okay. 00:40:59.793 --> 00:41:01.280 I just wanted to make sure I understood that 00:41:01.280 --> 00:41:02.219 because of the ruling- 00:41:02.219 --> 00:41:03.360 It's gonna be a real simple redline. 00:41:03.360 --> 00:41:06.930 I expect 4500 to replace 9000 in those two spots. 00:41:06.930 --> 00:41:08.500 Okay, great. 00:41:08.500 --> 00:41:09.920 Thank you. 00:41:09.920 --> 00:41:12.983 So do we want to, 00:41:14.370 --> 00:41:16.610 if we wanna have it done, 00:41:16.610 --> 00:41:19.000 and just by you mentioning this in terms 00:41:19.000 --> 00:41:22.533 of the timing for proper rulemaking, 00:41:23.420 --> 00:41:25.130 given the extraordinary circumstances 00:41:25.130 --> 00:41:26.980 since the storm that we're all in, 00:41:26.980 --> 00:41:29.960 this Commission has already moved forward 00:41:29.960 --> 00:41:33.368 with critical rulemakings and an accelerated process. 00:41:33.368 --> 00:41:35.130 I think we had a 10-day comment period 00:41:35.130 --> 00:41:39.727 for the Phase 1 weatherization rule. 00:41:39.727 --> 00:41:41.326 And I would certainly be comfortable 00:41:41.326 --> 00:41:44.170 using a similarly accelerated timeline 00:41:44.170 --> 00:41:46.363 for an issue as critical as this. 00:41:47.720 --> 00:41:50.330 Of course, considering that we've already had months 00:41:50.330 --> 00:41:53.280 of public comment on this included 00:41:53.280 --> 00:41:58.280 in our many other elements of feedback for market redesign. 00:42:04.020 --> 00:42:05.280 I guess it takes us back to, 00:42:05.280 --> 00:42:09.930 do we want to pick a number from the dias, 00:42:09.930 --> 00:42:12.293 starting with 4500, I'm fine with, 00:42:13.410 --> 00:42:16.260 get with the stakeholders, evaluate that, 00:42:16.260 --> 00:42:20.518 include that feedback in the comments due September 30th, 00:42:20.518 --> 00:42:22.518 then work with staff to issue a redline? 00:42:23.585 --> 00:42:25.110 And then October 7th, we've got a week 00:42:25.110 --> 00:42:27.110 to process their comments. 00:42:27.110 --> 00:42:30.540 October 7th, we can issue a proposed rule 00:42:32.130 --> 00:42:37.070 using the same 10-day comment period we did 00:42:37.070 --> 00:42:38.630 with weatherization. 00:42:38.630 --> 00:42:42.133 That would get us to the 17th. 00:42:43.400 --> 00:42:47.430 And from there we would, depending on how many comments 00:42:47.430 --> 00:42:48.460 we get back from the public 00:42:48.460 --> 00:42:52.070 during that official public comment period, 00:42:52.070 --> 00:42:55.733 staff will respond, per the process. 00:42:56.750 --> 00:42:59.589 And then I don't know the next open meeting after that. 00:42:59.589 --> 00:43:01.640 The 27th, I think. 00:43:01.640 --> 00:43:05.000 So the 27th of October, we could be adopting 00:43:05.000 --> 00:43:08.683 a new VOLL high cap number that will, 00:43:09.540 --> 00:43:11.460 and that would still leave November, December. 00:43:11.460 --> 00:43:14.620 Yes, Ms. Speltzer, feel free to come up. 00:43:14.620 --> 00:43:16.286 The 28th is the open meeting. 00:43:16.286 --> 00:43:17.880 The 28th. The 28th? 00:43:17.880 --> 00:43:21.290 So just for your context, 00:43:21.290 --> 00:43:25.600 any proposal that you determine to publish 00:43:25.600 --> 00:43:28.040 at the October 7th open meeting will appear 00:43:28.040 --> 00:43:30.863 in the Texas Register on October 22nd. 00:43:32.620 --> 00:43:34.880 It takes a little time to work its way 00:43:34.880 --> 00:43:36.220 through the process. 00:43:36.220 --> 00:43:41.110 But even so, I believe we could get comments 00:43:41.110 --> 00:43:45.500 back and have it free at the November 4th open meeting 00:43:45.500 --> 00:43:46.353 for adoption. 00:43:47.470 --> 00:43:49.830 That would still leave essentially two months 00:43:49.830 --> 00:43:54.533 for that rule change to be operationalized at ERCOT. 00:43:55.810 --> 00:43:56.643 Correct. 00:43:56.643 --> 00:43:58.700 Is it a requirement to wait to be published 00:43:58.700 --> 00:43:59.850 in the Texas Register? 00:43:59.850 --> 00:44:02.210 Because I believe we went through this discussion 00:44:02.210 --> 00:44:04.410 with Barksdale with the weatherization rule. 00:44:05.320 --> 00:44:08.990 It is not but if we simply started counting 00:44:12.430 --> 00:44:17.130 the 10 days from the 7th, the comments would be due 00:44:17.130 --> 00:44:19.143 before it ever appeared in the Register. 00:44:20.230 --> 00:44:24.520 So I would recommend at least allowing 00:44:24.520 --> 00:44:27.650 a couple days after it's been in the Register, 00:44:27.650 --> 00:44:30.490 which is considered our official notice. 00:44:30.490 --> 00:44:33.590 Are you, I heard something about a series 00:44:33.590 --> 00:44:36.793 of open meetings regarding securitization. 00:44:37.810 --> 00:44:39.410 Yeah, so the 30th and the 8th. 00:44:41.585 --> 00:44:44.910 The 30th of September and the 5th and 6th of October. 00:44:44.910 --> 00:44:47.930 They're earlier than your focus here. 00:44:47.930 --> 00:44:50.940 Is the Texas Register timeline, 00:44:50.940 --> 00:44:54.910 is that by publication date or just by 14-day process 00:44:54.910 --> 00:44:56.300 at the Register? 00:44:56.300 --> 00:44:57.880 That's by publication date. 00:44:57.880 --> 00:45:00.913 When's the next previous publication date? 00:45:07.302 --> 00:45:08.400 Do you mean when's the publication date 00:45:08.400 --> 00:45:11.560 before the 22nd? Yes. 00:45:11.560 --> 00:45:14.320 There's a publication date on October 15th. 00:45:14.320 --> 00:45:17.387 The submission date for that is October 4th. 00:45:18.470 --> 00:45:19.440 Yes, so that's the problem. 00:45:19.440 --> 00:45:22.690 Remember, the 30th open meeting has already been posted 00:45:22.690 --> 00:45:24.740 and it's a limited agenda. 00:45:24.740 --> 00:45:27.152 So it would have to be modified. 00:45:27.152 --> 00:45:29.840 It's only covering those dockets related to securitization, 00:45:29.840 --> 00:45:30.673 that's the problem. All right. 00:45:30.673 --> 00:45:33.333 You can post the meeting for the 4th. 00:45:34.684 --> 00:45:36.190 Post the meeting for the 4th. 00:45:36.190 --> 00:45:37.220 I mean, I think we're gonna be able 00:45:37.220 --> 00:45:40.097 to get there with the PFP adoption on the- 00:45:40.097 --> 00:45:42.758 And November 4th for adoption. 00:45:42.758 --> 00:45:46.590 Yes. Okay. 00:45:46.590 --> 00:45:49.683 And especially, I know it's a very narrow scope but- 00:45:50.670 --> 00:45:54.830 It's very volatile. (everyone laughing) 00:45:54.830 --> 00:45:55.910 Yes, sir. 00:45:55.910 --> 00:46:00.590 And so that way we can get feedback. 00:46:00.590 --> 00:46:03.170 Let's make sure we got your thinking right. 00:46:03.170 --> 00:46:05.160 We're asking stakeholders in concurrence 00:46:05.160 --> 00:46:08.250 with if there are market redesign comments 00:46:08.250 --> 00:46:10.990 due to the Commission on the 30th. 00:46:10.990 --> 00:46:15.810 We would also ask that they file comments 00:46:15.810 --> 00:46:18.210 related to this very specific high cap 00:46:18.210 --> 00:46:23.210 and VOLL component of the 25.505 00:46:23.320 --> 00:46:25.053 by the 30th to the Commission. 00:46:26.600 --> 00:46:28.053 You include that with the, 00:46:29.140 --> 00:46:31.690 or do you want to open a separate project for that? 00:46:34.200 --> 00:46:35.340 No. 00:46:35.340 --> 00:46:38.880 Well, I don't wanna make life that much- 00:46:38.880 --> 00:46:41.493 I would recommend opening a separate project. 00:46:41.493 --> 00:46:43.340 You would, okay? Yes. 00:46:43.340 --> 00:46:44.437 I didn't wanna step in there. 00:46:44.437 --> 00:46:46.450 And then we'll proceed with your proposed rule 00:46:46.450 --> 00:46:48.080 in that same new project. 00:46:48.080 --> 00:46:49.720 Okay. That makes sense for you? 00:46:49.720 --> 00:46:50.913 Makes sense for me. 00:46:50.913 --> 00:46:52.730 Just that we'll open the new project 00:46:52.730 --> 00:46:56.420 just on the very narrow component of 25.505 00:46:57.590 --> 00:46:59.253 regarding VOLL and high cap. 00:47:00.380 --> 00:47:03.390 September comments come back September 30th. 00:47:03.390 --> 00:47:06.843 We will have a redline ready October 5th. 00:47:08.959 --> 00:47:09.792 The 7th. Yes. 00:47:09.792 --> 00:47:10.833 The 7th, sorry. 00:47:12.470 --> 00:47:16.110 And with the goal of publishing that 00:47:16.110 --> 00:47:19.680 in the Texas Register on the 22nd, Ms. Speltzer. 00:47:19.680 --> 00:47:21.670 Yes. Okay. 00:47:21.670 --> 00:47:26.670 And then with an appropriate 10-day public comment period. 00:47:28.914 --> 00:47:30.570 Seven day? Seven day. 00:47:30.570 --> 00:47:32.970 Seven-day public comment period, 00:47:32.970 --> 00:47:37.350 which would be the 13th opportunity for the public 00:47:37.350 --> 00:47:39.203 to comment on this since June. 00:47:42.710 --> 00:47:46.480 Seven-day formal, official public comment period 00:47:47.440 --> 00:47:50.970 from October 22nd to the 29th. 00:47:50.970 --> 00:47:54.190 Staff will respond to those comments submitted 00:47:54.190 --> 00:47:58.020 by the public and be prepared for the Commission 00:47:58.020 --> 00:48:02.690 to formally adopt the rule at our October 4th open meeting. 00:48:02.690 --> 00:48:04.290 November 4th. November 4th. 00:48:05.213 --> 00:48:06.237 - November 4th. 00:48:06.237 --> 00:48:07.570 I look forward to seeing this in the transcript. 00:48:07.570 --> 00:48:10.620 That's a great plan. (everyone laughing) 00:48:10.620 --> 00:48:12.070 Janice is the best. 00:48:13.730 --> 00:48:14.700 I'm good with that, yes. 00:48:14.700 --> 00:48:16.430 That'll work? Jimmy? 00:48:16.430 --> 00:48:17.263 Yes. 00:48:17.263 --> 00:48:19.110 And the only thing I wanted to say 00:48:20.410 --> 00:48:22.597 with respect to your request for the proposals 00:48:22.597 --> 00:48:25.410 and your encouragement of stakeholders submitting proposals 00:48:25.410 --> 00:48:28.700 on the 30th, it would be really helpful 00:48:28.700 --> 00:48:32.270 to get very specific stakeholder solutions 00:48:32.270 --> 00:48:34.650 with an implementation path going forward, 00:48:34.650 --> 00:48:37.490 whether that requires PUC rule change 00:48:37.490 --> 00:48:41.690 and/or ERCOT protocol changes, system changes. 00:48:41.690 --> 00:48:43.830 What is our implementation path going forward 00:48:43.830 --> 00:48:46.060 to implement their recommended proposals? 00:48:46.060 --> 00:48:48.980 And to the extent that stakeholders can get together 00:48:48.980 --> 00:48:53.220 and jointly file proposals, that would be very helpful 00:48:53.220 --> 00:48:56.060 because I feel like I've heard a variety of proposals 00:48:56.060 --> 00:48:59.430 that have different elements of similarity. 00:48:59.430 --> 00:49:01.170 If the stakeholders could get together 00:49:01.170 --> 00:49:03.730 and agree to joint proposals, 00:49:03.730 --> 00:49:06.810 that would also be very helpful for our evaluation 00:49:06.810 --> 00:49:07.880 of those proposals. 00:49:07.880 --> 00:49:08.713 Very good point. 00:49:08.713 --> 00:49:10.930 Implementation is gonna be a key part of this. 00:49:12.194 --> 00:49:14.510 And another thing in addition to that 00:49:14.510 --> 00:49:17.030 is please also keep in mind the general context 00:49:17.030 --> 00:49:18.053 of the proposals. 00:49:19.165 --> 00:49:20.110 In the universe we're working in, 00:49:20.110 --> 00:49:22.890 I suspect that my colleagues are not going 00:49:22.890 --> 00:49:26.170 to be very excited about any new ancillary service product 00:49:26.170 --> 00:49:29.103 that contains 70,000 megawatts over peak, 00:49:30.270 --> 00:49:33.880 given that would be a capacity market or anything like that. 00:49:33.880 --> 00:49:38.800 Also, please, please keep the real-life implementation 00:49:38.800 --> 00:49:41.903 in context, in consideration, when you submit these. 00:49:44.900 --> 00:49:47.130 All right, does staff have any other questions 00:49:47.130 --> 00:49:51.720 or need any other action from us? 00:49:51.720 --> 00:49:55.640 If I could just walk it back to confirm? 00:49:55.640 --> 00:49:59.790 Today, we'll be opening a new project 00:49:59.790 --> 00:50:03.745 to look at 25.505 for the very limited purpose 00:50:03.745 --> 00:50:06.610 that you have outlined here today 00:50:06.610 --> 00:50:11.610 and we will file a request for comments 00:50:11.660 --> 00:50:13.513 on that very limited issue. 00:50:14.900 --> 00:50:18.971 Given that it is such a limited issue, 00:50:18.971 --> 00:50:23.303 the comments will be limited in page number. 00:50:24.432 --> 00:50:26.253 Yes. 00:50:28.850 --> 00:50:30.623 Can we limit the number of lines? 00:50:31.483 --> 00:50:34.483 (everyone laughing) 00:50:35.440 --> 00:50:37.980 What were you thinking about in terms of page numbers? 00:50:37.980 --> 00:50:39.250 Five. 00:50:39.250 --> 00:50:40.083 Five pages. 00:50:40.083 --> 00:50:43.620 We're talking about a number and one issue 00:50:43.620 --> 00:50:44.973 about VOLL and high caps. 00:50:48.496 --> 00:50:49.329 That's a narrow scope. 00:50:49.329 --> 00:50:50.162 Two? 00:50:50.162 --> 00:50:50.995 What are you feeling here? 00:50:54.890 --> 00:50:58.900 Five, because again, you want the back cast analysis 00:50:58.900 --> 00:51:01.780 to describe how it will increase pressure 00:51:01.780 --> 00:51:03.730 on generators, you name it. 00:51:03.730 --> 00:51:07.040 Okay, good? That's good. 00:51:07.040 --> 00:51:11.040 All right, and for our stakeholder community, 00:51:11.040 --> 00:51:16.040 the tentative proposal starting point 00:51:16.340 --> 00:51:18.310 from Commissioner McAdams is 4500, 00:51:18.310 --> 00:51:20.610 50% reduction from current high cap. 00:51:20.610 --> 00:51:22.740 Any thoughts on- The number? 00:51:22.740 --> 00:51:23.740 Makes sense? 00:51:23.740 --> 00:51:24.850 That makes sense to me. 00:51:24.850 --> 00:51:27.344 I'm comfortable with starting at 4500. 00:51:27.344 --> 00:51:29.110 Absolutely. All right. 00:51:29.110 --> 00:51:32.660 And I'll just add to Commissioner Cobos' comment 00:51:32.660 --> 00:51:36.470 about the filings in 52373, 00:51:36.470 --> 00:51:38.313 the market design recommendations, 00:51:39.160 --> 00:51:42.306 staff's been having informal conversations 00:51:42.306 --> 00:51:46.580 with market participants and asking them to work, 00:51:46.580 --> 00:51:49.114 once all the filings are in, 00:51:49.114 --> 00:51:51.020 to review one another's and come prepared 00:51:51.020 --> 00:51:53.940 to the October 14th workshop, 00:51:53.940 --> 00:51:58.940 to discuss comparison and contrast among the proposals, 00:51:59.240 --> 00:52:01.820 their own and other parties'. 00:52:01.820 --> 00:52:04.880 Yeah, so there's value in seeing what everybody, 00:52:04.880 --> 00:52:06.437 or a large segment of people, agree on. 00:52:06.437 --> 00:52:08.230 But there's also value in seeing, 00:52:08.230 --> 00:52:11.600 which is your point, let's see where the consensus is 00:52:11.600 --> 00:52:15.710 but that's also, that doesn't mean to discard other ideas. 00:52:15.710 --> 00:52:17.710 So we can see whether there's consensus, 00:52:18.660 --> 00:52:21.660 which is one universe, but also see other ideas 00:52:21.660 --> 00:52:26.360 that may be worth learning about 00:52:26.360 --> 00:52:31.100 and certainly I don't think any of us 00:52:31.100 --> 00:52:34.510 will be afraid to pick and choose 00:52:34.510 --> 00:52:39.053 and take components from any or all of these. 00:52:39.972 --> 00:52:41.120 What about Brattle? 00:52:41.120 --> 00:52:42.770 I think that's important as well. 00:52:44.570 --> 00:52:49.510 So we will have Brattle at the October 14th work session? 00:52:49.510 --> 00:52:50.343 Yes. 00:52:50.343 --> 00:52:55.343 Yes, ERCOT has retained the Brattle Group 00:52:55.560 --> 00:52:59.280 as the in-house consulting firm to help 00:52:59.280 --> 00:53:00.510 both ERCOT and the Commission 00:53:00.510 --> 00:53:01.720 as we move through this process. 00:53:01.720 --> 00:53:04.730 And they have been working and will be working 00:53:04.730 --> 00:53:07.374 with ERCOT staff and PUC staff 00:53:07.374 --> 00:53:11.250 and will be available at that open work session 00:53:11.250 --> 00:53:12.700 on October 14th. 00:53:12.700 --> 00:53:13.815 Good point. 00:53:13.815 --> 00:53:15.915 Thank you for reminding me. Absolutely. 00:53:16.870 --> 00:53:17.703 All right. 00:53:18.640 --> 00:53:19.870 Thanks, Mr. Chairman. 00:53:19.870 --> 00:53:20.703 Thank you. 00:53:24.169 --> 00:53:27.923 That's a big move critical to that January 1st timeline. 00:53:29.450 --> 00:53:32.733 That is a major consumer protection item. 00:53:35.702 --> 00:53:38.190 That will bring us to item 17, 00:53:40.410 --> 00:53:45.240 related to energy regional state committee. 00:53:45.240 --> 00:53:49.343 Staff has filed a memo on this. 00:53:50.240 --> 00:53:52.010 Come on up. 00:53:52.010 --> 00:53:55.680 We'll call up Warner Roth and Justin Atkins 00:53:55.680 --> 00:53:56.903 from Commission staff. 00:54:01.950 --> 00:54:04.050 Warner Roth on behalf of Commission staff. 00:54:04.050 --> 00:54:06.090 The memo I filed in the SVP 00:54:06.090 --> 00:54:10.920 and MISO dockets is related to FERC docket RM21-17, 00:54:10.920 --> 00:54:13.553 related to the advanced notice of proposed rulemaking 00:54:13.553 --> 00:54:15.740 on building for the future through electric 00:54:15.740 --> 00:54:17.640 regional transmission planning, cost allocation, 00:54:17.640 --> 00:54:19.410 and generation interconnection. 00:54:19.410 --> 00:54:23.313 This is a broad advance of a rulemaking. 00:54:25.410 --> 00:54:27.750 A broad docket opened up to review a more, 00:54:27.750 --> 00:54:28.890 to take a more holistic view 00:54:28.890 --> 00:54:31.270 of FERC's transmission planning processes, 00:54:31.270 --> 00:54:33.090 transmission cost allocation processes, 00:54:33.090 --> 00:54:34.867 and the generation interconnection processes 00:54:34.867 --> 00:54:36.993 for FERC jurisdiction RTOs. 00:54:38.990 --> 00:54:41.930 This could potentially have significant ramifications 00:54:41.930 --> 00:54:44.580 on shifting costs, changing how transmission planning 00:54:44.580 --> 00:54:46.110 is done in FERC jurisdictions. 00:54:46.110 --> 00:54:48.100 So in any of the non-ERCOT areas, 00:54:48.100 --> 00:54:50.820 I know that the SVP Regional State Committee 00:54:50.820 --> 00:54:52.330 and the Organization of MISO States 00:54:52.330 --> 00:54:55.510 are both considering making comments in this docket, 00:54:55.510 --> 00:54:57.100 both in the initial phase and in response 00:54:57.100 --> 00:55:00.960 to other commenters later on. 00:55:00.960 --> 00:55:03.450 I am making a recommendation for the Commission 00:55:03.450 --> 00:55:05.340 to file an intervention in this docket 00:55:05.340 --> 00:55:07.990 so that we may engage with our outside counsel 00:55:07.990 --> 00:55:11.223 in making sure our interests are protected in this docket. 00:55:13.570 --> 00:55:15.157 Fair enough, thank you. 00:55:15.157 --> 00:55:16.807 Any thoughts, comments, concerns? 00:55:17.790 --> 00:55:21.937 Just having watched the interstate traffic on this 00:55:21.937 --> 00:55:24.160 and by that I mean filing traffic, 00:55:24.160 --> 00:55:25.990 I think it's consistent that Texas start 00:55:25.990 --> 00:55:29.070 to stake out our own position 00:55:29.070 --> 00:55:32.110 and I like Warner's recommendation. 00:55:32.110 --> 00:55:32.943 Absolutely. 00:55:32.943 --> 00:55:35.750 I know MISO was looking at some long-term 00:55:35.750 --> 00:55:38.040 transmission planning issues and cost allocation. 00:55:38.040 --> 00:55:41.070 I think it's really important that we get involved 00:55:41.070 --> 00:55:43.480 in these issues at the federal level 00:55:43.480 --> 00:55:45.123 and also at the MISO level. 00:55:47.890 --> 00:55:52.704 So I would, I agree that we should have this intervention 00:55:52.704 --> 00:55:54.310 in this way. 00:55:54.310 --> 00:55:58.280 I hope that in the future, we can put more meat 00:55:58.280 --> 00:55:59.820 on the bone when we have an intervention 00:55:59.820 --> 00:56:02.360 and talk about really what our issues are, 00:56:02.360 --> 00:56:05.510 especially in light of the winter storm. 00:56:05.510 --> 00:56:08.500 We've got parts of Texas that are in both 00:56:08.500 --> 00:56:11.630 of these regions and transmission planning, 00:56:11.630 --> 00:56:14.570 use of emergency power, all of the issues 00:56:14.570 --> 00:56:17.900 that are wrapped up into this issue 00:56:17.900 --> 00:56:19.760 could be valuable to our citizens 00:56:19.760 --> 00:56:22.320 that live in those non-ERCOT areas. 00:56:22.320 --> 00:56:24.700 And I feel it's incumbent upon us 00:56:24.700 --> 00:56:28.010 to be participating in those process. 00:56:28.010 --> 00:56:30.470 I think as it stands now, I may be wrong 00:56:30.470 --> 00:56:34.060 but MISO South doesn't even have any transmission 00:56:34.060 --> 00:56:35.180 proposed right now. 00:56:35.180 --> 00:56:37.630 And that's a challenge. 00:56:37.630 --> 00:56:40.450 I think that area was hit just as hard 00:56:40.450 --> 00:56:44.390 as many other regions during winter storm Uri. 00:56:44.390 --> 00:56:46.610 And if there are things that we need 00:56:46.610 --> 00:56:50.300 for our consumers in Texas, we have to use this process. 00:56:50.300 --> 00:56:52.470 We've gotta get in there and we've gotta roll our sleeves up 00:56:52.470 --> 00:56:54.650 and do it and participate. 00:56:54.650 --> 00:56:58.129 Agreed, we do need transmission to ensure reliability 00:56:58.129 --> 00:57:01.350 in the areas of the state that are not within ERCOT. 00:57:01.350 --> 00:57:04.010 Those are very important areas of our state as well. 00:57:04.010 --> 00:57:07.130 And also to make sure that those ratepayers 00:57:07.130 --> 00:57:10.341 are not being allocated costs for other parts 00:57:10.341 --> 00:57:13.368 of those other ISO RTOs that they are not getting 00:57:13.368 --> 00:57:14.852 the benefit for. 00:57:14.852 --> 00:57:16.285 And one other thing that I wanna say 00:57:16.285 --> 00:57:21.285 is these committees and regions, MISO, SPP, 00:57:22.390 --> 00:57:24.453 even PJM and others, 00:57:25.440 --> 00:57:27.810 they're not easy games to play in. 00:57:27.810 --> 00:57:30.000 They're established players there. 00:57:30.000 --> 00:57:31.583 They have relationships. 00:57:33.099 --> 00:57:34.710 Commissions change and right when you get 00:57:34.710 --> 00:57:35.620 to know some Commissioners, 00:57:35.620 --> 00:57:37.930 they change on the RSCs and stuff. 00:57:37.930 --> 00:57:41.130 And us getting in there and building relationships 00:57:41.130 --> 00:57:42.600 and having them understand what we want 00:57:42.600 --> 00:57:45.900 and what we need is as important as anything. 00:57:45.900 --> 00:57:50.700 So I think that again, us being involved in these 00:57:50.700 --> 00:57:52.010 is really important. 00:57:52.010 --> 00:57:54.160 And I know it takes staff time, 00:57:54.160 --> 00:57:55.420 I know it takes Commissioner time 00:57:55.420 --> 00:58:00.210 but it's a part of the state that we can't ignore. 00:58:00.210 --> 00:58:02.505 They represent a lot of Texans. 00:58:02.505 --> 00:58:04.920 I'd agree with you, Commissioner. 00:58:04.920 --> 00:58:09.253 The trend for the rest of the country, MISO, SVP, 00:58:11.130 --> 00:58:12.860 they've been, similar to ERCOT, 00:58:12.860 --> 00:58:16.490 so many issues have been at log jams and logger heads 00:58:16.490 --> 00:58:17.630 for so long. 00:58:17.630 --> 00:58:21.130 I think FERC is starting to press a little bit 00:58:21.130 --> 00:58:22.280 to break some log jams. 00:58:22.280 --> 00:58:25.610 And that will necessitate Texas being very well-acquainted 00:58:25.610 --> 00:58:27.450 with those processes and engaged 00:58:27.450 --> 00:58:30.410 because even with the slivers that we do have 00:58:30.410 --> 00:58:32.970 in those ISOs, we are a big part of their load 00:58:32.970 --> 00:58:35.510 and must be engaged. 00:58:35.510 --> 00:58:37.780 Well, we do have one other market that's not covered 00:58:37.780 --> 00:58:39.760 right now by Commissioner McAdams and I 00:58:39.760 --> 00:58:41.890 and that's WAC, the western part of the grid 00:58:41.890 --> 00:58:43.510 where El Paso is. 00:58:43.510 --> 00:58:45.703 So that might be something that, 00:58:46.777 --> 00:58:48.516 I'm not giving an assignment 00:58:48.516 --> 00:58:51.360 but since I've had my fair share- 00:58:51.360 --> 00:58:53.360 Do I hear a fifth Commissioner coming? 00:58:54.242 --> 00:58:55.242 I'm kidding. 00:58:57.830 --> 00:58:59.314 Item up for discussion, absolutely. 00:58:59.314 --> 00:59:01.950 Yeah, any interest in taking on that charge? 00:59:01.950 --> 00:59:02.783 Perhaps. 00:59:05.830 --> 00:59:06.930 All right. 00:59:06.930 --> 00:59:08.913 Look forward to exploring that opportunity. 00:59:11.850 --> 00:59:15.743 All right, Mr. Roth, thank you for laying that out. 00:59:16.650 --> 00:59:21.060 Is there a motion to authorize the PUC 00:59:21.060 --> 00:59:22.800 to file a dockless intervention 00:59:22.800 --> 00:59:26.980 in the FERC docket number RM-21-17, 00:59:26.980 --> 00:59:28.340 directing staff and an outside counsel 00:59:28.340 --> 00:59:29.993 to monitor this FERC proceeding? 00:59:31.272 --> 00:59:32.750 So moved. Second. 00:59:32.750 --> 00:59:34.078 All in favor, say aye. Aye. 00:59:34.078 --> 00:59:34.911 Aye. 00:59:34.911 --> 00:59:35.744 Motion passes. 00:59:35.744 --> 00:59:36.577 Thank you, sir. 00:59:37.790 --> 00:59:41.840 We are not, well I guess 18 and 19 were covered 00:59:41.840 --> 00:59:43.040 under the previous item. 00:59:44.322 --> 00:59:46.590 And that will bring us to item 20, 00:59:46.590 --> 00:59:51.590 regarding transmission and its relation to reliability. 00:59:52.450 --> 00:59:54.766 We've had several entities file material 00:59:54.766 --> 00:59:58.730 on this in response to Commissioner Cobos' memo. 00:59:58.730 --> 01:00:00.940 And I suspect Commissioner Cobos 01:00:00.940 --> 01:00:04.173 has some thoughts and suggestions. 01:00:05.080 --> 01:00:06.430 Thank you, Chairman Lake. 01:00:06.430 --> 01:00:08.840 Just for background purposes, 01:00:08.840 --> 01:00:11.200 this is a follow-up on our discussion 01:00:11.200 --> 01:00:13.100 from the September 2nd open meeting 01:00:13.100 --> 01:00:16.620 and in response to Chairman Lake's action items, 01:00:16.620 --> 01:00:18.140 during that open meeting, 01:00:18.140 --> 01:00:20.873 I requested that ERCOT file additional information 01:00:20.873 --> 01:00:23.900 regarding long-term and other interim transmission 01:00:23.900 --> 01:00:25.750 improvements to help ensure reliability in the 01:00:25.750 --> 01:00:26.653 Rio Grande Valley. 01:00:27.720 --> 01:00:30.270 Also information related to the boundary threshold used 01:00:30.270 --> 01:00:33.400 by ERCOT in transmission planning for reliability purposes, 01:00:33.400 --> 01:00:36.490 and to also provide us an update on ERCOT's ability 01:00:36.490 --> 01:00:38.440 to implement the new consumer benefits test 01:00:38.440 --> 01:00:41.160 that is required by Senate Bill 1281. 01:00:41.160 --> 01:00:45.290 Woody Rickerson is here today to discuss their filing. 01:00:45.290 --> 01:00:47.240 And while Woody makes his way up here, 01:00:47.240 --> 01:00:49.903 I will also say that on September 14th, 01:00:49.903 --> 01:00:52.300 I filed a memo requesting that the transmission service 01:00:52.300 --> 01:00:54.060 providers that would be responsible 01:00:54.060 --> 01:00:56.880 for building the interim transmission improvements 01:00:56.880 --> 01:00:59.900 that we had ERCOT and those companies evaluate, 01:00:59.900 --> 01:01:01.330 which included a second circuit 01:01:01.330 --> 01:01:02.904 from San Miguel to Palmito 01:01:02.904 --> 01:01:06.530 and a new transmission facility to close the loop 01:01:06.530 --> 01:01:08.451 from Palmito to Edinburgh. 01:01:08.451 --> 01:01:11.480 I requested that those transmission service providers 01:01:11.480 --> 01:01:13.330 follow their estimated timelines and costs 01:01:13.330 --> 01:01:17.080 to build their respective portions of those facilities 01:01:17.080 --> 01:01:19.753 and they filed them on September 20th. 01:01:21.000 --> 01:01:23.420 And I requested that representatives of Stack, 01:01:23.420 --> 01:01:26.160 AUP/ETT and Cherryland be here today, 01:01:26.160 --> 01:01:27.663 in case we have any questions, 01:01:30.144 --> 01:01:32.123 after we walk through ERCOT's filing. 01:01:34.500 --> 01:01:36.230 Where would you like me to start? 01:01:36.230 --> 01:01:38.273 Just at the top with Rio Grande Valley. 01:01:42.780 --> 01:01:45.201 So my name is Woody Rickerson. 01:01:45.201 --> 01:01:46.034 I'm the Vice President of Grid Planning 01:01:46.034 --> 01:01:46.990 and Operations at ERCOT. 01:01:48.140 --> 01:01:51.193 So we'll start with the Rio Grande Valley. 01:01:53.620 --> 01:01:57.230 Most of the demand of the Rio Grande Valley 01:01:57.230 --> 01:02:00.150 is in Cameron, Hidalgo Starr, and Woolsey Counties, 01:02:00.150 --> 01:02:02.173 which is further south. 01:02:04.150 --> 01:02:07.630 The summer peak demand in that area 01:02:07.630 --> 01:02:11.983 is projected to reach 3200 megawatts in 2026. 01:02:13.920 --> 01:02:17.050 Using our established planning criteria, 01:02:17.050 --> 01:02:20.050 the existing system, if you don't have any major outages, 01:02:20.050 --> 01:02:25.050 can reliably serve load up through that point 01:02:25.560 --> 01:02:29.490 and then system changes will be needed in 2027. 01:02:29.490 --> 01:02:31.360 That's the kind of status of where we are right now. 01:02:31.360 --> 01:02:33.590 System changes will need to have been 01:02:33.590 --> 01:02:35.007 completed by 2027. 01:02:35.007 --> 01:02:36.650 Required. 01:02:36.650 --> 01:02:37.963 And why? 01:02:37.963 --> 01:02:39.567 Is that a reliability need that arises in 2027? 01:02:39.567 --> 01:02:41.340 That's a reliability need. 01:02:41.340 --> 01:02:43.720 The existing system will no longer 01:02:43.720 --> 01:02:47.950 be able to reliably serve, without having overloads, 01:02:47.950 --> 01:02:50.150 physical overloads of the system, 01:02:50.150 --> 01:02:53.280 the load that's in that area in 2027. 01:02:53.280 --> 01:02:55.930 So they can serve, just in layman's terms, 01:02:55.930 --> 01:02:59.750 right now the existing transmission can serve 3200 megawatts 01:02:59.750 --> 01:03:04.750 of load, based on projections. 01:03:05.270 --> 01:03:10.270 After 2026, it will not be able to serve- 01:03:10.750 --> 01:03:12.030 That's right. 01:03:12.030 --> 01:03:13.950 Any increased load beyond that. 01:03:13.950 --> 01:03:14.783 Right. 01:03:15.950 --> 01:03:17.613 So we don't need to start in 2026, 01:03:17.613 --> 01:03:19.200 we need to start sooner. 01:03:19.200 --> 01:03:20.070 Absolutely, yeah. 01:03:20.070 --> 01:03:21.943 So yes. 01:03:23.870 --> 01:03:25.960 Just a little more background on that area, 01:03:25.960 --> 01:03:28.783 it's primarily connected to the rest of ERCOT 01:03:28.783 --> 01:03:33.783 through three 345 kb lines. 01:03:33.910 --> 01:03:34.903 Those are long lines. 01:03:34.903 --> 01:03:38.350 They're series compensated, which has its own 01:03:38.350 --> 01:03:39.533 stability issues. 01:03:41.010 --> 01:03:44.100 Two of those lines run parallel to the coast 01:03:44.100 --> 01:03:46.900 and make them susceptible to hurricane damage, 01:03:46.900 --> 01:03:49.430 which is a constant concern that we have. 01:03:49.430 --> 01:03:53.620 But not something that is directly accounted 01:03:53.620 --> 01:03:54.973 for in planning standards. 01:03:56.600 --> 01:03:58.600 Woody, do you know when those three circuits 01:03:58.600 --> 01:04:01.920 were put in place, were placed into service, what year? 01:04:01.920 --> 01:04:04.630 And I did ask the TSPs as well 01:04:04.630 --> 01:04:08.044 but just for context, if you can at this time? 01:04:08.044 --> 01:04:10.890 So the 345 line coming from Laredo 01:04:10.890 --> 01:04:12.410 was put in place in 2016. 01:04:12.410 --> 01:04:16.240 So that westernmost line runs parallel to the Rio Grande 01:04:16.240 --> 01:04:17.513 was 2016. 01:04:18.450 --> 01:04:19.283 All of it? 01:04:19.283 --> 01:04:21.260 From San Miguel to Palmito? 01:04:21.260 --> 01:04:24.000 From, you might have to get some of the TSPs 01:04:24.000 --> 01:04:24.833 up here to help me on that. 01:04:24.833 --> 01:04:29.250 But from Laredo down to the lower Rio Grande Valley, 01:04:29.250 --> 01:04:30.933 that was completed in 2016. 01:04:32.961 --> 01:04:34.560 The other two lines, I don't know for sure 01:04:34.560 --> 01:04:35.564 when those were put in place. 01:04:35.564 --> 01:04:37.950 It was prior to the year 2000 though. 01:04:37.950 --> 01:04:41.030 Yeah, so in terms of the western leg, 01:04:41.030 --> 01:04:41.970 the San Miguel- 01:04:41.970 --> 01:04:43.110 State your name and who you're with. 01:04:43.110 --> 01:04:46.060 Piece was put in place, energized in 2010. 01:04:46.060 --> 01:04:48.212 Can you please state your name and who you're with? 01:04:48.212 --> 01:04:49.045 I'm sorry. 01:04:49.045 --> 01:04:51.610 Wayman Smith with American Electric Power Service Corp, 01:04:51.610 --> 01:04:54.523 here for AUP Texas and ETT. 01:04:56.010 --> 01:04:59.700 Okay, and please continue, what year? 01:04:59.700 --> 01:05:03.460 2010 for the San Miguel to Lobo portion. 01:05:03.460 --> 01:05:08.460 And then, as Woody indicated, from Lobo to Palmito, 2016. 01:05:09.791 --> 01:05:13.840 And then, as he alluded to, the two 345s 01:05:13.840 --> 01:05:16.650 on the east side of the valley have been in place for awhile 01:05:16.650 --> 01:05:19.230 but those were actually reconductored 01:05:19.230 --> 01:05:21.760 in that 2016 timeframe as well. 01:05:25.910 --> 01:05:27.230 So continuing on, 01:05:27.230 --> 01:05:28.760 just a little bit more background information. 01:05:28.760 --> 01:05:29.990 Can I ask you one question? 01:05:29.990 --> 01:05:32.350 You said that the two easternmost lines 01:05:32.350 --> 01:05:34.930 that are hurricane susceptible are not, 01:05:34.930 --> 01:05:38.163 that's not modeled into our transmission planning standards? 01:05:41.580 --> 01:05:45.560 Well, the fact that they are vulnerable 01:05:45.560 --> 01:05:47.090 because they're on the coast, 01:05:47.090 --> 01:05:48.990 doesn't give them any special treatment 01:05:48.990 --> 01:05:51.140 in our planning standards. 01:05:51.140 --> 01:05:55.640 But is there any, should there be? 01:05:55.640 --> 01:05:57.373 I guess that's the question. 01:05:58.320 --> 01:06:00.630 Well, I think- Since there are 01:06:00.630 --> 01:06:01.540 three lines that go to the valley 01:06:01.540 --> 01:06:04.660 and two of them are susceptible to hurricanes. 01:06:04.660 --> 01:06:05.920 I think that's an integral part 01:06:05.920 --> 01:06:08.160 of what our recommendation is today actually. 01:06:08.160 --> 01:06:08.993 Okay. 01:06:13.899 --> 01:06:17.200 There is also limited conventional generation capacity 01:06:17.200 --> 01:06:20.690 in the Rio Grande Valley and there's no new planned 01:06:20.690 --> 01:06:23.050 conventional generation down there either. 01:06:23.050 --> 01:06:25.560 There's also a, we may have as much 01:06:25.560 --> 01:06:30.560 as seven gigawatts of our wind and solar generation 01:06:31.250 --> 01:06:32.083 there as well. 01:06:32.083 --> 01:06:34.740 So there's a lot of that that's coming on. 01:06:34.740 --> 01:06:36.790 Coming on or is it there, Woody? 01:06:36.790 --> 01:06:39.533 A lot of it's there but there's a lot of growth there too. 01:06:40.550 --> 01:06:44.013 So we could still have seven gigawatts of wind and solar. 01:06:45.800 --> 01:06:48.590 The implication being that if the wind's blowing 01:06:48.590 --> 01:06:50.470 and the sun's shining there, 01:06:50.470 --> 01:06:54.700 there's more power supply than is needed 01:06:54.700 --> 01:06:59.330 at the current time and with transmission constraints, 01:06:59.330 --> 01:07:01.670 it can't get to the rest of Texas? 01:07:01.670 --> 01:07:04.340 Transmission definitely has constraints there, yeah. 01:07:04.340 --> 01:07:06.740 And it's Gulf Coast wind? 01:07:06.740 --> 01:07:08.080 Some of it's Gulf Coast wind 01:07:08.080 --> 01:07:10.940 and some of it is along the Rio Grande Valley 01:07:10.940 --> 01:07:14.080 or along the Rio Grande, there's a lot in that area too, 01:07:14.080 --> 01:07:15.890 which has a little bit different characteristic 01:07:15.890 --> 01:07:18.393 than the Gulf wind does. 01:07:20.256 --> 01:07:22.680 And that Gulf Coast wind is more 01:07:22.680 --> 01:07:24.630 of a non-peak wind resource? 01:07:24.630 --> 01:07:26.290 That's correct, the Gulf Coast wind 01:07:26.290 --> 01:07:30.150 has a higher on-peak capacity factor than the non 01:07:31.670 --> 01:07:34.253 or wind that's located in other areas. 01:07:36.250 --> 01:07:37.860 And finally, the other thing I'd point out 01:07:37.860 --> 01:07:40.750 is that we currently have 01:07:40.750 --> 01:07:44.180 16 generic transmission constraints 01:07:44.180 --> 01:07:46.030 that have to do with stability limits 01:07:46.886 --> 01:07:48.136 in the entire ERCOT grid. 01:07:49.370 --> 01:07:51.570 Seven of those are in the Rio Grande Valley. 01:07:52.470 --> 01:07:56.760 And that has to do with the amount of invertebrate 01:07:56.760 --> 01:07:59.160 generation that's there and also the fact 01:07:59.160 --> 01:08:03.040 that Rio Grande Valley is on the edge of the system 01:08:03.040 --> 01:08:05.533 and somewhat isolated from the rest of the grid. 01:08:06.430 --> 01:08:09.800 So all these factors that we're talking about, 01:08:09.800 --> 01:08:12.360 the relative isolation of the Rio Grande Valley 01:08:12.360 --> 01:08:13.660 being on the edge of our system, 01:08:13.660 --> 01:08:16.980 being a long ways from a lot of the rest of the system, 01:08:16.980 --> 01:08:19.640 the susceptibility to hurricane damage, 01:08:19.640 --> 01:08:23.890 load growth, it's a growing area, 01:08:23.890 --> 01:08:26.140 the number of GTCs and the stability concerns 01:08:26.140 --> 01:08:30.323 we have there, the penetration level of the wind and solar, 01:08:32.060 --> 01:08:35.330 the fact that we have outage coordination issues there. 01:08:35.330 --> 01:08:37.230 If someone wants to take a plant out of service, 01:08:37.230 --> 01:08:39.570 it's very difficult for them to do that. 01:08:39.570 --> 01:08:42.898 If someone wants to take a 345 line out for service, 01:08:42.898 --> 01:08:45.040 it's very difficult to coordinate those outages as well. 01:08:45.040 --> 01:08:47.489 Those outages can't occur right now 01:08:47.489 --> 01:08:50.510 during anything near a peak condition. 01:08:50.510 --> 01:08:52.600 They have to occur during off-peak conditions. 01:08:52.600 --> 01:08:54.890 And when you have competing entities 01:08:54.890 --> 01:08:56.470 wanting to take those same outages, 01:08:56.470 --> 01:08:59.070 it becomes very difficult too to coordinate outages. 01:09:00.127 --> 01:09:02.240 And that's for both transmission and generation. 01:09:02.240 --> 01:09:05.463 And also the three lines that are coming in 01:09:05.463 --> 01:09:09.647 are series compensated, which causes stability concerns 01:09:09.647 --> 01:09:13.190 and it also causes sub-synchronous residence issues 01:09:13.190 --> 01:09:14.293 with generators. 01:09:15.750 --> 01:09:19.370 That's the price you pay for putting the series compensation 01:09:19.370 --> 01:09:20.870 in on those lines. 01:09:20.870 --> 01:09:24.190 But all of those factors, 01:09:24.190 --> 01:09:27.150 we have those factors in other places in the grid as well. 01:09:27.150 --> 01:09:30.372 But I think the Rio Grande Valley may be the only place 01:09:30.372 --> 01:09:32.883 where all of those factors are part of the story. 01:09:35.310 --> 01:09:39.980 And so that combination of all of those factors 01:09:42.070 --> 01:09:44.260 makes the Rio Grande Valley unique 01:09:44.260 --> 01:09:47.593 and it also stretches our planning criteria 01:09:47.593 --> 01:09:48.763 that we currently have. 01:09:51.590 --> 01:09:53.413 So in order to- 01:09:53.413 --> 01:09:56.420 What do you mean stretches the planning criteria? 01:09:56.420 --> 01:09:58.490 It puts us right on the edge 01:09:58.490 --> 01:10:01.170 of having to rely on the system all the time. 01:10:01.170 --> 01:10:03.323 We're just in time with improvements. 01:10:04.670 --> 01:10:07.450 So more transmission would probably be better. 01:10:07.450 --> 01:10:09.250 More transmission would be better. 01:10:11.140 --> 01:10:14.807 Getting more transmission causes reliability issues, 01:10:16.580 --> 01:10:18.623 which prevents getting more transmission. 01:10:21.560 --> 01:10:25.106 So in order to address that combination of factors, 01:10:25.106 --> 01:10:28.250 we looked at, along with the TSPs, 01:10:28.250 --> 01:10:32.740 we've looked at multiple transmission solutions down there 01:10:32.740 --> 01:10:34.710 and there was a short list that was filed with you 01:10:34.710 --> 01:10:37.040 of two long-term improvement options 01:10:37.040 --> 01:10:38.993 for the Rio Grande Valley. 01:10:40.500 --> 01:10:44.200 Those two options have some things in common. 01:10:44.200 --> 01:10:48.530 They involve a 345 line that comes from San Miguel 01:10:48.530 --> 01:10:49.810 and goes into the Rio Grande Valley. 01:10:49.810 --> 01:10:51.660 It also involves another 345 line 01:10:51.660 --> 01:10:54.150 that cuts across from the Laredo area 01:10:54.150 --> 01:10:57.800 to about halfway between Corpus and the Rio Grande Valley, 01:10:57.800 --> 01:10:58.890 so it's kind of a cross. 01:10:58.890 --> 01:11:01.868 And there's two different versions of that. 01:11:01.868 --> 01:11:04.900 Of those two versions, option two is the plan 01:11:04.900 --> 01:11:08.390 that ERCOT recommends to ensure that the grid 01:11:08.390 --> 01:11:09.790 continues to serve the load. 01:11:11.840 --> 01:11:13.450 So if you compare the two options 01:11:13.450 --> 01:11:15.283 that's on slide seven for you, 01:11:16.360 --> 01:11:18.890 the two options are pretty similar 01:11:18.890 --> 01:11:23.890 in the estimated 345 kb right-of-way that they require. 01:11:25.320 --> 01:11:27.900 The estimated cost is similar. 01:11:27.900 --> 01:11:32.080 But option two is significantly better 01:11:32.080 --> 01:11:37.443 because of stability constraints, SSR mitigation. 01:11:38.520 --> 01:11:41.980 It's further from the coast so it reduces 01:11:41.980 --> 01:11:45.333 the impact of potential hurricane damage. 01:11:48.090 --> 01:11:52.560 And so we recommend that the option two 01:11:52.560 --> 01:11:53.760 is the preferred option. 01:11:55.520 --> 01:11:57.093 It's a tier one project. 01:11:58.033 --> 01:11:59.593 A CCN will be required. 01:12:00.830 --> 01:12:03.100 We've presented this to the Regional Planning Group 01:12:03.100 --> 01:12:06.873 on September 15th and we're collecting comments now. 01:12:09.820 --> 01:12:13.440 Unless directed otherwise, we plan on seeking 01:12:13.440 --> 01:12:14.930 TAC review and board enforcement money 01:12:14.930 --> 01:12:18.574 into the year for that option two. 01:12:18.574 --> 01:12:23.574 Woody, is that option two, the 345 kb 01:12:23.650 --> 01:12:25.450 is double-circuit capable? 01:12:25.450 --> 01:12:27.680 Is it gonna include two circuits or one circuit? 01:12:27.680 --> 01:12:29.260 It will be two circuits. 01:12:29.260 --> 01:12:31.210 When it's built? Yes. 01:12:31.210 --> 01:12:32.043 Okay. 01:12:34.730 --> 01:12:39.730 So Woody, on costs, sorry, I gotta look at that. 01:12:42.820 --> 01:12:44.140 That's a lot. 01:12:44.140 --> 01:12:45.510 Big numbers. Those are big numbers. 01:12:45.510 --> 01:12:49.523 Those are CREZ type numbers, ballpark ish. 01:12:51.560 --> 01:12:55.160 But what we get out of that is you use latest technology, 01:12:55.160 --> 01:12:56.580 you kind of have a hardened system, 01:12:56.580 --> 01:13:01.580 it's interior, and I'm trying to frame this 01:13:02.230 --> 01:13:06.001 for the hew and cry that's sure to come up. 01:13:06.001 --> 01:13:08.210 Well, it would supply the needs of the Valley 01:13:08.210 --> 01:13:10.913 from a low-growth perspective through 2040. 01:13:10.913 --> 01:13:12.750 Through 2040, yep, all right, got it. 01:13:12.750 --> 01:13:15.200 So the reliability need that would present itself 01:13:15.200 --> 01:13:18.213 in 2027 would be moved back to 2040? 01:13:18.213 --> 01:13:21.730 Yes. At least. 01:13:21.730 --> 01:13:23.700 That would be greater than 2040. 01:13:23.700 --> 01:13:26.070 Our load forecasting gets a little hazy 01:13:26.070 --> 01:13:27.300 when you get out that many years. 01:13:27.300 --> 01:13:29.670 But up until at least 2040, 01:13:29.670 --> 01:13:32.220 we don't see any more reliability issues 01:13:32.220 --> 01:13:34.657 serving load in the Valley. 01:13:34.657 --> 01:13:37.560 And what were the alternatives that you, 01:13:37.560 --> 01:13:39.470 I'm sure there were a handful of them. 01:13:39.470 --> 01:13:41.540 You don't have to go through every single one of them. 01:13:41.540 --> 01:13:44.653 But obviously, building a $1.2 billion line, 01:13:45.970 --> 01:13:49.440 requiring likely 100% new right away 01:13:49.440 --> 01:13:54.440 through the center part of the Rio Grande Valley is hard. 01:13:54.650 --> 01:13:55.870 I know that's hard work. 01:13:55.870 --> 01:13:58.763 I know siting transmission, working with landowners, 01:13:59.740 --> 01:14:01.380 it's a hard thing. 01:14:01.380 --> 01:14:04.890 So what were the comparison points 01:14:04.890 --> 01:14:06.210 that made you all say oh, 01:14:06.210 --> 01:14:09.533 this is 100% worth it and the other ones aren't? 01:14:10.844 --> 01:14:14.120 The main option we compared against 01:14:14.120 --> 01:14:15.470 was very similar in nature. 01:14:16.374 --> 01:14:17.207 It required very similar lines, 01:14:17.207 --> 01:14:19.290 the endpoints were a little bit different, 01:14:19.290 --> 01:14:21.800 it was not quite as good an option 01:14:21.800 --> 01:14:24.250 because of outage coordination issues 01:14:24.250 --> 01:14:25.920 and also because it doesn't help as much 01:14:25.920 --> 01:14:29.530 with the SSR issues that the other line did. 01:14:29.530 --> 01:14:32.970 So as far as cost goes, it's was a very similar cost. 01:14:32.970 --> 01:14:33.803 As far as right-of-way goes, 01:14:33.803 --> 01:14:36.160 it's very similar in right-of-way. 01:14:36.160 --> 01:14:39.540 The option two thought definitely had some advantages 01:14:39.540 --> 01:14:42.040 in outage coordination, in SSR reduction. 01:14:42.040 --> 01:14:44.793 A little bit further from the coast 01:14:44.793 --> 01:14:47.589 so it's a little less likely to have hurricane damage 01:14:47.589 --> 01:14:49.710 and things like that. 01:14:49.710 --> 01:14:51.763 Now, there are some other options there. 01:14:53.500 --> 01:14:55.080 There are some existing, 01:14:55.080 --> 01:14:58.420 those existing 345 lines, there is an option 01:14:58.420 --> 01:15:02.060 on the one that comes down the Rio Grande there, 01:15:02.060 --> 01:15:04.500 you could add a second circuit there 01:15:04.500 --> 01:15:06.380 and that's not as costly. 01:15:06.380 --> 01:15:10.502 However, it is not what we recommend 01:15:10.502 --> 01:15:12.430 as a reliability project. 01:15:12.430 --> 01:15:14.680 It would be continuing to do what we've done 01:15:14.680 --> 01:15:17.113 in the past, which is just one step ahead. 01:15:18.673 --> 01:15:23.106 Someone described that as you've got 01:15:23.106 --> 01:15:26.070 the tachometer on your car is in the yellow. 01:15:26.070 --> 01:15:28.550 It's not in the red yet, it's in the yellow. 01:15:28.550 --> 01:15:31.220 That second circuit would mean keeping that tachometer 01:15:31.220 --> 01:15:32.053 in the yellow. 01:15:33.200 --> 01:15:35.770 Building this takes us back out 01:15:35.770 --> 01:15:37.300 so we have a little more margin. 01:15:37.300 --> 01:15:39.800 I just wanna provide a point of clarification 01:15:39.800 --> 01:15:43.630 because I've had filings specifically made to me, 01:15:43.630 --> 01:15:45.820 and I'm not the only one making the decision here 01:15:45.820 --> 01:15:47.220 on the Rio Grande Valley. 01:15:47.220 --> 01:15:50.672 I think my peers and I are extremely interested 01:15:50.672 --> 01:15:55.450 in ensuring reliability in the Rio Grande Valley. 01:15:55.450 --> 01:15:58.768 So I'm responding to the letters that were provided, 01:15:58.768 --> 01:16:02.980 and that is there's a lot of confusion out there 01:16:02.980 --> 01:16:06.082 that I hear in the ERCOT stakeholder process 01:16:06.082 --> 01:16:09.072 and concerns with the second circuit. 01:16:09.072 --> 01:16:13.140 And the concern being that the second circuit shouldn't be 01:16:13.140 --> 01:16:18.140 a replacement for the new option two long-term project. 01:16:20.420 --> 01:16:22.200 And I just wanna be very clear that 01:16:22.200 --> 01:16:27.040 at no time did I ever say that it was an either/or 01:16:27.040 --> 01:16:29.060 or versus project. 01:16:29.060 --> 01:16:31.840 But somehow the messaging has gotten confused 01:16:31.840 --> 01:16:33.700 and there's been a lot of pushback 01:16:33.700 --> 01:16:34.900 on the second circuit saying, 01:16:34.900 --> 01:16:38.617 it's not an option for replacing the new project 01:16:40.200 --> 01:16:41.320 or deferring it. 01:16:41.320 --> 01:16:43.670 And I just wanna be very clear that that has 01:16:43.670 --> 01:16:45.030 never been the case. 01:16:45.030 --> 01:16:46.730 We're looking at both of them. 01:16:46.730 --> 01:16:49.053 It's an and, not an either/or. 01:16:50.070 --> 01:16:53.483 And so I just want to level set there and be very clear. 01:16:54.460 --> 01:16:55.400 Okay. 01:16:55.400 --> 01:16:56.920 And when you say it's not gonna 01:16:56.920 --> 01:16:58.670 to provide a reliability benefit, 01:16:58.670 --> 01:17:00.420 in your presentation today, 01:17:00.420 --> 01:17:02.830 you say that it pushes back the reliability need 01:17:02.830 --> 01:17:05.220 from 2027 to 2033. 01:17:05.220 --> 01:17:07.670 How long is it gonna take to build a new project? 01:17:08.990 --> 01:17:10.613 What's your best cost estimate? 01:17:11.500 --> 01:17:14.450 Option two estimate is that it will be completed in 2027. 01:17:15.470 --> 01:17:19.491 Option two in four years. 01:17:19.491 --> 01:17:22.810 Okay, what's your best estimate for completing that project? 01:17:22.810 --> 01:17:24.940 No, we think that option two, 01:17:24.940 --> 01:17:27.240 we could complete that in five years. 01:17:27.240 --> 01:17:29.720 So we're sitting here today, if you start in 2022, 01:17:29.720 --> 01:17:31.043 that'd be '26. 01:17:32.150 --> 01:17:33.910 Right when you were about to hit the red. 01:17:33.910 --> 01:17:36.170 Okay, so then on the second circuit, 01:17:36.170 --> 01:17:37.540 and I know you're gonna cover it in a minute, 01:17:37.540 --> 01:17:39.530 but I just wanna make sure that this is clear too, 01:17:39.530 --> 01:17:41.428 is that in the filings I've received, 01:17:41.428 --> 01:17:45.950 most of the line that's owned by AUP/EDT is 34 months, 01:17:45.950 --> 01:17:47.400 if you do it hot. 01:17:47.400 --> 01:17:52.400 And so if you're looking at it as an second circuit 01:17:52.540 --> 01:17:57.540 and new 345 kb project, you are, 01:17:57.590 --> 01:18:00.340 most likely the construction it appears, 01:18:00.340 --> 01:18:02.450 and please clarify me if I'm wrong, 01:18:02.450 --> 01:18:06.140 that if we decided to add a second circuit, 01:18:06.140 --> 01:18:08.370 then that second circuit would be put in place 01:18:08.370 --> 01:18:11.960 maybe a year or two, maybe even three, 01:18:11.960 --> 01:18:13.290 before the new project. 01:18:13.290 --> 01:18:14.880 So then you'd have a staggered, 01:18:14.880 --> 01:18:19.530 sort of phased implementation of new infrastructure 01:18:19.530 --> 01:18:22.300 that would both provide reliability to the Valley. 01:18:22.300 --> 01:18:25.640 So Woody, in your opinion, would both of those options 01:18:25.640 --> 01:18:28.683 provide a reliability benefit together to the Valley? 01:18:29.783 --> 01:18:33.410 The second circuit definitely has a reliability benefit 01:18:33.410 --> 01:18:34.243 to the Valley. 01:18:34.243 --> 01:18:37.023 It does push that need out as well. 01:18:37.890 --> 01:18:39.220 Yes. 01:18:39.220 --> 01:18:41.075 And option two definitely has, 01:18:41.075 --> 01:18:44.399 I mean, that's the fix for the Valley. 01:18:44.399 --> 01:18:46.433 That is the ERCOT recommendation. 01:18:47.410 --> 01:18:50.000 The second circuit also has a reliability benefit, 01:18:50.000 --> 01:18:54.270 but we just don't wanna see that ultimate fix 01:18:54.270 --> 01:18:55.720 get pushed back. 01:18:55.720 --> 01:18:58.950 Right, and again, it's not an either/or or versus, 01:18:58.950 --> 01:19:00.763 it's an and that I'm looking at. 01:19:02.220 --> 01:19:05.310 When the original lines were built, 01:19:05.310 --> 01:19:08.080 the Laredo to Rio Grande Valley and such, 01:19:08.080 --> 01:19:12.000 and I'm assuming here this is, and correct me if I'm wrong, 01:19:12.000 --> 01:19:14.910 that they were all single circuits 01:19:14.910 --> 01:19:16.330 and they were put on double-circuit towers. 01:19:16.330 --> 01:19:17.163 Is that right? 01:19:18.930 --> 01:19:21.330 If everybody's pushing back saying we shouldn't 01:19:21.330 --> 01:19:22.890 put another circuit there, 01:19:22.890 --> 01:19:25.750 then why did we go and use double-circuit towers 01:19:25.750 --> 01:19:27.050 and put that in rate-based, 01:19:27.050 --> 01:19:30.490 if that was never gonna be a opportunity 01:19:30.490 --> 01:19:34.960 to double-circuit those structures? 01:19:34.960 --> 01:19:37.960 Yeah, if I could maybe, maybe add a little bit of clarity. 01:19:39.160 --> 01:19:42.090 I think that the concern was maybe in the way 01:19:42.090 --> 01:19:45.210 this was maybe packaged a little bit in the PowerPoints 01:19:45.210 --> 01:19:48.430 because it says, well, if you string second circuits, 01:19:48.430 --> 01:19:52.180 that pushes out the reliability need until 2033, 01:19:52.180 --> 01:19:54.050 which might lead you to the conclusion, 01:19:54.050 --> 01:19:57.470 oh, well, we don't need anything 'til 2033. 01:19:57.470 --> 01:20:00.010 Let's just kick the can down the road 01:20:00.010 --> 01:20:03.640 on a long-term option two solution. 01:20:03.640 --> 01:20:05.918 And I think that was the concern. 01:20:05.918 --> 01:20:07.700 I just heard a recommendation not 01:20:07.700 --> 01:20:09.880 to build the second circuit. 01:20:09.880 --> 01:20:10.890 Well, I- And I would appreciate 01:20:10.890 --> 01:20:13.450 the concerns being brought to my office 01:20:13.450 --> 01:20:16.790 instead of being voiced at RPG 01:20:16.790 --> 01:20:19.210 against the Commission suggestion. 01:20:19.210 --> 01:20:22.280 And maybe coming to my office before you decide 01:20:22.280 --> 01:20:23.383 to write me letters. 01:20:24.290 --> 01:20:25.123 Understood. 01:20:26.040 --> 01:20:30.300 But just to be clear, from AUP, Texas ETT perspective, 01:20:30.300 --> 01:20:31.810 does the second circuit have value? 01:20:31.810 --> 01:20:32.770 Absolutely. 01:20:32.770 --> 01:20:33.750 It has value. 01:20:33.750 --> 01:20:36.190 It improves the load serving capability. 01:20:36.190 --> 01:20:38.580 As a short-term, interim solution, 01:20:38.580 --> 01:20:41.610 until we can get that long-term solution in place, 01:20:41.610 --> 01:20:43.130 does that make sense? 01:20:43.130 --> 01:20:45.143 It absolutely provides a value. 01:20:46.020 --> 01:20:49.890 But I just, in my mind I would be concerned 01:20:49.890 --> 01:20:53.200 that not to let that overshadow our need 01:20:53.200 --> 01:20:54.343 for that for a source. 01:20:55.476 --> 01:20:56.718 Okay, 'cause I mean, I guess I've been a little confused 01:20:56.718 --> 01:21:00.134 with the filings I got on Monday the 20th 01:21:00.134 --> 01:21:01.480 versus the letter I got last night 01:21:01.480 --> 01:21:04.810 with respect to how AUP/ETT feels about the second circuit. 01:21:04.810 --> 01:21:09.100 Because in my meetings directly with Mr. Fox 01:21:09.100 --> 01:21:11.370 and there was a lot of interest in, you know, 01:21:11.370 --> 01:21:15.130 there seemed to be no issues, no reliability risk 01:21:15.130 --> 01:21:17.320 with the second circuit, y'all can do it hot, 01:21:17.320 --> 01:21:19.010 you can get it done, get it done quickly, 01:21:19.010 --> 01:21:21.420 get it done quicker than ERCOT says. 01:21:21.420 --> 01:21:23.990 And then all of a sudden I'm getting a letter last night 01:21:23.990 --> 01:21:25.120 saying, well, you know, 01:21:25.120 --> 01:21:27.270 it might get more complicated and no mention 01:21:27.270 --> 01:21:28.440 of the hot work. 01:21:28.440 --> 01:21:32.500 And again, trying to combine the two projects 01:21:32.500 --> 01:21:34.380 as competing projects. 01:21:34.380 --> 01:21:38.050 So that's what I'm concerned about 01:21:38.050 --> 01:21:40.610 is that I've gotten mixed messages. 01:21:40.610 --> 01:21:44.950 The last thing we wanna do is disturb existing reliability 01:21:44.950 --> 01:21:45.800 in the Valley. 01:21:45.800 --> 01:21:46.990 That's the last thing we wanna do. 01:21:46.990 --> 01:21:49.690 We want to bring additional reliability to the Valley. 01:21:51.080 --> 01:21:54.480 So if we were to order the second circuit, 01:21:54.480 --> 01:21:56.800 we would want that done in the best way possible 01:21:56.800 --> 01:21:59.650 to maintain existing reliability in the Valley. 01:21:59.650 --> 01:22:00.483 Absolutely, understood. 01:22:00.483 --> 01:22:03.510 And I have been assured by your company, ETT, 01:22:03.510 --> 01:22:06.820 that you can do it hot, you can do it reliably. 01:22:06.820 --> 01:22:10.640 ERCOT has to approve and coordinate outages. 01:22:10.640 --> 01:22:11.720 But I want to make sure we're going 01:22:11.720 --> 01:22:12.893 to order that line, that it's going to done, 01:22:12.893 --> 01:22:15.360 that that second circuit is gonna be built reliably. 01:22:15.360 --> 01:22:18.163 So we're not gonna put the Valley at risk, 01:22:18.163 --> 01:22:20.690 although having one line there for so long, 01:22:20.690 --> 01:22:24.111 that's built for two lines, double-circuit capable 01:22:24.111 --> 01:22:27.420 for so long, for at least 11 years part of it, 01:22:27.420 --> 01:22:29.670 has put us in a bind now, 01:22:29.670 --> 01:22:32.070 because now we have infrastructure there that we want 01:22:32.070 --> 01:22:32.903 to add another line. 01:22:32.903 --> 01:22:37.160 And so now there's this reliability coordinating outage. 01:22:37.160 --> 01:22:38.190 I mean, it should have just been built 01:22:38.190 --> 01:22:40.250 with the two circuits that from the beginning, 01:22:40.250 --> 01:22:41.083 it sounds like. 01:22:41.083 --> 01:22:42.933 I would like to understand why it wasn't. 01:22:44.300 --> 01:22:47.610 If it was approved, if a CCN was approved 01:22:47.610 --> 01:22:50.697 for a 345 double-circuit capable transmission line 01:22:50.697 --> 01:22:53.160 and the ratepayers are paying for extra infrastructure 01:22:53.160 --> 01:22:56.063 for a second line, why wasn't the second line added? 01:22:56.920 --> 01:22:58.506 Yeah, the short answer is adding 01:22:58.506 --> 01:23:01.180 the second circuit adds cost. 01:23:01.180 --> 01:23:03.390 And if we can not, 01:23:03.390 --> 01:23:05.150 at the time those decisions were made, 01:23:05.150 --> 01:23:09.510 if we cannot definitively show, based on ERCOT 01:23:09.510 --> 01:23:11.500 planning criteria, that there's a need 01:23:11.500 --> 01:23:13.940 for that additional capacity associated 01:23:13.940 --> 01:23:17.094 with the second circuit, it doesn't get endorsed. 01:23:17.094 --> 01:23:19.660 Have you brought it forward since 01:23:19.660 --> 01:23:23.280 for ERCOT to review in the last five, 10 years? 01:23:23.280 --> 01:23:25.400 Because the Valley has exploded in population 01:23:25.400 --> 01:23:27.950 and economic growth, and I'm surprised to hear 01:23:27.950 --> 01:23:28.810 that there's just no need. 01:23:28.810 --> 01:23:33.180 No, we have, AUP has made two RPG filings 01:23:33.180 --> 01:23:37.800 since that line was put in service in 2016, 01:23:37.800 --> 01:23:39.770 we have made two RPG filings. 01:23:39.770 --> 01:23:42.690 In both of those RPG filings, we looked at alternatives 01:23:42.690 --> 01:23:46.210 that included the new bringing a fourth source 01:23:46.210 --> 01:23:49.320 in as well as stringing the second circuits. 01:23:49.320 --> 01:23:51.830 And in neither case, did we get endorsement 01:23:51.830 --> 01:23:55.680 because we said, well, the need date is further out 01:23:55.680 --> 01:23:58.794 so we're gonna, put a band-aid on it 01:23:58.794 --> 01:24:00.630 and we're going to put additional dynamic reactive 01:24:00.630 --> 01:24:02.840 in the Valley, we're gonna push it out a little bit more. 01:24:02.840 --> 01:24:06.210 And so far that has been the decision. 01:24:06.210 --> 01:24:07.370 But we have brought that forward. 01:24:07.370 --> 01:24:09.970 We have brought forward both a new source 01:24:09.970 --> 01:24:11.970 as well as stringing the second circuit. 01:24:13.060 --> 01:24:13.893 Okay. 01:24:13.893 --> 01:24:15.440 Well, the band-aid seems to be the reason 01:24:15.440 --> 01:24:17.360 why we're always playing catch up in the Valley. 01:24:17.360 --> 01:24:18.273 100% agree. 01:24:19.890 --> 01:24:23.550 And no other dispatchable resource 01:24:23.550 --> 01:24:26.137 to any degree is moving into the valley 01:24:26.137 --> 01:24:28.370 and that's this catch-up problem. 01:24:28.370 --> 01:24:31.110 ID generation, to help levelize this. 01:24:31.110 --> 01:24:33.630 And we can't have it islanded. 01:24:33.630 --> 01:24:34.474 And at the end of the day, 01:24:34.474 --> 01:24:37.444 that's a policy decision for the State of Texas 01:24:37.444 --> 01:24:39.480 and certainly us. 01:24:39.480 --> 01:24:41.570 That's what's coming in here 01:24:41.570 --> 01:24:45.730 and if option two is one of those right choices, 01:24:45.730 --> 01:24:49.275 and I appreciate this briefing because it helps frame it 01:24:49.275 --> 01:24:51.480 at 1.28 billion. 01:24:51.480 --> 01:24:54.190 And then the other options, 01:24:54.190 --> 01:24:57.583 which redundancy is helpful in a disaster-prone area, 01:24:57.583 --> 01:24:59.307 that is currently islanded- 01:24:59.307 --> 01:25:01.300 And the most western line. Yes, ma'am. 01:25:01.300 --> 01:25:03.393 400 to 450 million. 01:25:04.580 --> 01:25:07.128 Look, we've gotta envision it as a whole. 01:25:07.128 --> 01:25:10.420 That happens to be the cost of a combined cycle gas plant, 01:25:10.420 --> 01:25:13.490 somewhere in the valley, if it was ever to deploy. 01:25:13.490 --> 01:25:15.150 I will say, and I wanna be clear, 01:25:15.150 --> 01:25:17.770 that I do think that the new long-term project 01:25:17.770 --> 01:25:21.120 has a lot of value and ERCOT supports it. 01:25:21.120 --> 01:25:24.453 It has a plethora of value for the Valley. 01:25:25.423 --> 01:25:29.660 And two, with respect to your cost concerns, 01:25:29.660 --> 01:25:32.060 in no way will we be making a cost of determination 01:25:32.060 --> 01:25:34.010 with our discussions or any actions that we make. 01:25:34.010 --> 01:25:34.960 Right, understood. 01:25:34.960 --> 01:25:36.160 Today. Today. 01:25:36.160 --> 01:25:37.280 It is not a blank check. 01:25:37.280 --> 01:25:40.150 As Chairman Lake has said in prior open meeting, 01:25:40.150 --> 01:25:41.373 it is not a blank check. 01:25:42.347 --> 01:25:44.950 The utilities would still be expected to meet 01:25:44.950 --> 01:25:47.160 rate making principles and standards 01:25:47.160 --> 01:25:50.180 that comply with PURA and the Commission's rules. 01:25:50.180 --> 01:25:53.210 So whatever actions, if we take any actions on this 01:25:53.210 --> 01:25:55.010 from our dias ordering construction, 01:25:55.010 --> 01:25:57.154 that it's no determination on costs. 01:25:57.154 --> 01:25:58.301 Sure. We will still expect staff 01:25:58.301 --> 01:26:01.030 to review those costs, as they would review all other 01:26:01.030 --> 01:26:04.463 transmission-related and other costs in a rate case. 01:26:05.330 --> 01:26:08.440 I would want to chime in on the cost issue. 01:26:08.440 --> 01:26:10.640 And that is I've scratched my head a little bit 01:26:10.640 --> 01:26:13.370 to figure out where $450 million comes 01:26:13.370 --> 01:26:17.660 from on a second circuit on existing structures 01:26:17.660 --> 01:26:19.123 and existing rights of way. 01:26:20.167 --> 01:26:21.270 I know there are three new substations, 01:26:21.270 --> 01:26:23.940 but adding a second circuit. 01:26:23.940 --> 01:26:25.130 So I struggle with that. 01:26:25.130 --> 01:26:27.290 So I'd love to have some more input 01:26:27.290 --> 01:26:31.500 on why a second circuit costs so much 01:26:31.500 --> 01:26:33.650 on an existing structure. 01:26:33.650 --> 01:26:38.150 And I would assume, again, I could be very, very wrong, 01:26:38.150 --> 01:26:40.810 but when you built the first structure 01:26:40.810 --> 01:26:42.003 and the single circuit, 01:26:43.096 --> 01:26:45.850 you probably built the substations 01:26:45.850 --> 01:26:47.350 in such that that could be added to, 01:26:47.350 --> 01:26:48.950 if you were gonna add a second circuit. 01:26:48.950 --> 01:26:51.880 So it begs my question of why would you need 01:26:51.880 --> 01:26:53.203 three more substations? 01:26:54.207 --> 01:26:55.610 So if you can just kind of fill me in 01:26:55.610 --> 01:26:56.910 on a little bit of that, that'd be great. 01:26:56.910 --> 01:26:59.818 I will and I'll try. 01:26:59.818 --> 01:27:01.440 I have a hard time doing it sometimes 01:27:01.440 --> 01:27:02.370 without drawing on a board. 01:27:02.370 --> 01:27:07.370 But the short answer is the existing structures 01:27:07.660 --> 01:27:09.950 are double-circuit capable, but the arms 01:27:09.950 --> 01:27:12.493 are not on the structures. Okay. 01:27:12.493 --> 01:27:15.040 So, they're set up, they're drilled and tapped 01:27:15.040 --> 01:27:18.240 to add the other arm, but the other arm's not there. 01:27:18.240 --> 01:27:21.720 So there's a lot of costs involved there, number one. 01:27:21.720 --> 01:27:26.020 And then the second issue is when you make turns, 01:27:26.020 --> 01:27:28.570 you can't make those turns, 01:27:28.570 --> 01:27:30.530 we refer to them as heavy angles. 01:27:30.530 --> 01:27:33.920 The really severe turns, 01:27:33.920 --> 01:27:36.720 you can't make those with circuits 01:27:36.720 --> 01:27:38.300 on both sides of the towers. 01:27:38.300 --> 01:27:42.140 And so what happens is when you get to one of those turns, 01:27:42.140 --> 01:27:46.080 you have a single structure that each circuit will hit 01:27:46.080 --> 01:27:47.940 in order to make the bend. 01:27:47.940 --> 01:27:50.360 And so every place, there's a turn, 01:27:50.360 --> 01:27:53.530 we have to go put a structure there, it's not there today. 01:27:53.530 --> 01:27:55.623 So it's the combination of, 01:27:56.714 --> 01:28:01.370 from a material and engineering and design perspective, 01:28:01.370 --> 01:28:05.140 it's one adding that second arm to the existing structures, 01:28:05.140 --> 01:28:07.410 and then two, setting all of the structures 01:28:07.410 --> 01:28:09.450 that are needed to make those turns. 01:28:09.450 --> 01:28:12.090 And when you look at those estimates, in particular, 01:28:12.090 --> 01:28:17.090 between the Lobo to North Ed section versus 01:28:17.125 --> 01:28:20.440 North Ed to Palmito, there's a significant difference 01:28:20.440 --> 01:28:23.010 in costs for stringing the second circuit 01:28:23.010 --> 01:28:24.630 on those two sections. 01:28:24.630 --> 01:28:26.200 And it gets back to what I just said. 01:28:26.200 --> 01:28:28.100 The section from North Ed to Palmito, 01:28:28.100 --> 01:28:29.637 there are a bunch of turns, 01:28:29.637 --> 01:28:33.330 twists and turns as you traverse that circuit. 01:28:33.330 --> 01:28:36.320 So you have to set a bunch of additional structures 01:28:36.320 --> 01:28:38.750 in order to make all those turns. 01:28:38.750 --> 01:28:40.250 Those three new substations. 01:28:41.120 --> 01:28:43.277 I mean, substations are expensive 01:28:43.277 --> 01:28:45.514 and in some cases are needed. 01:28:45.514 --> 01:28:47.756 And in your filing on September 20th, 01:28:47.756 --> 01:28:48.740 you say that three substations are needed 01:28:48.740 --> 01:28:51.140 for three wind farms. Correct. 01:28:51.140 --> 01:28:52.180 Can you clarify, why? 01:28:52.180 --> 01:28:55.640 Yeah, so, so, so what happened is 01:28:55.640 --> 01:28:58.160 in order to connect those wind farms, 01:28:58.160 --> 01:29:03.160 we built circuits, radial if you will, 01:29:03.860 --> 01:29:05.900 out of existing stations, 01:29:05.900 --> 01:29:10.722 utilizing portions of the open second circuit. 01:29:10.722 --> 01:29:13.922 And it's hard to see without a picture, 01:29:13.922 --> 01:29:17.260 but basically you have, for example, 01:29:17.260 --> 01:29:20.083 a line coming out of the Del Sol station. 01:29:20.960 --> 01:29:24.110 Utilizing that second circuit open position for say, 01:29:24.110 --> 01:29:27.680 15, 20 miles, and then going back 01:29:27.680 --> 01:29:30.250 and then going back to the wind farm. 01:29:30.250 --> 01:29:33.160 And so what happens when we string the second circuit, 01:29:33.160 --> 01:29:35.810 at the point where that line going to the wind farm 01:29:35.810 --> 01:29:38.590 comes in and hits the existing structure, 01:29:38.590 --> 01:29:40.660 we have to put a station there. 01:29:40.660 --> 01:29:43.990 And those are the three stations that we're talking about. 01:29:43.990 --> 01:29:45.250 So to come to this conclusion, 01:29:45.250 --> 01:29:47.513 did you run power flow models? 01:29:47.513 --> 01:29:49.690 I'm sorry. Power flow models. 01:29:49.690 --> 01:29:50.690 Oh, I'm asking him, sorry. 01:29:50.690 --> 01:29:51.941 I just happened to look at you. 01:29:51.941 --> 01:29:53.940 I'm sorry, I didn't. 01:29:53.940 --> 01:29:55.123 In coming up with the determination 01:29:55.123 --> 01:29:56.896 that you need those three wind farms, 01:29:56.896 --> 01:29:59.550 did you just run power flow models 01:29:59.550 --> 01:30:02.720 or has actual modeling work been done 01:30:02.720 --> 01:30:04.133 to support that conclusion? 01:30:05.945 --> 01:30:06.900 Well, those are just requests by the generators 01:30:06.900 --> 01:30:07.970 to interconnect our system. 01:30:07.970 --> 01:30:10.270 So we have an obligation to connect them 01:30:10.270 --> 01:30:12.110 and that was the lowest cost way 01:30:12.110 --> 01:30:14.173 to connect those generators. 01:30:17.594 --> 01:30:19.760 So you're combining two things. 01:30:19.760 --> 01:30:22.020 You're combining an interconnection issue 01:30:22.020 --> 01:30:23.540 with a reconductoring issue and trying 01:30:23.540 --> 01:30:25.920 to optimize that to figure out the best way 01:30:25.920 --> 01:30:27.690 to solve both, is that right? 01:30:27.690 --> 01:30:29.670 In that cost bundle, in that cost structure? 01:30:29.670 --> 01:30:31.630 Yeah, so we got a request for interconnections 01:30:31.630 --> 01:30:33.387 from these generators and we said okay, 01:30:33.387 --> 01:30:36.130 what's the most economical way to connect them. 01:30:36.130 --> 01:30:39.610 Well, we've got an open circuit 01:30:39.610 --> 01:30:41.130 on an existing line. 01:30:41.130 --> 01:30:43.610 Let's use what's there, as much as we can. 01:30:43.610 --> 01:30:46.100 And so we strung some of that second circuit 01:30:46.100 --> 01:30:47.433 when we connected them. 01:30:48.320 --> 01:30:51.017 And so that's, there's roughly 70 miles 01:30:51.017 --> 01:30:53.990 along that line that already has the conductor 01:30:53.990 --> 01:30:56.596 hanging on the second circuit, already has the arms. 01:30:56.596 --> 01:30:58.460 So that works to our benefit. 01:30:58.460 --> 01:31:02.840 But where the line directly coming 01:31:02.840 --> 01:31:05.930 from the generator comes in and hits 01:31:05.930 --> 01:31:07.930 the existing line, we have to put a station there 01:31:07.930 --> 01:31:08.763 to terminate it. 01:31:16.960 --> 01:31:18.800 I think that makes sense. 01:31:18.800 --> 01:31:22.230 I'm not gonna sit up here and argue against the engineering. 01:31:22.230 --> 01:31:24.200 But I think, from my standpoint, 01:31:24.200 --> 01:31:26.720 the papers that have been submitted 01:31:26.720 --> 01:31:31.200 were kind of lump sums saying a double circuit 01:31:31.200 --> 01:31:33.010 with three new substations costs 400 01:31:33.010 --> 01:31:34.590 and something million dollars. 01:31:34.590 --> 01:31:36.220 And a little bit more understanding 01:31:36.220 --> 01:31:40.850 of the components of that cost would be hugely valuable 01:31:40.850 --> 01:31:44.443 for me and I think everybody. 01:31:45.410 --> 01:31:48.270 I hope, quite frankly, that we look 01:31:48.270 --> 01:31:52.590 at this solution of adding second circuits 01:31:52.590 --> 01:31:55.865 to towers that are double-circuit capable 01:31:55.865 --> 01:32:00.170 as a first alternative to building some more transmission 01:32:00.170 --> 01:32:01.003 in the state. 01:32:01.003 --> 01:32:02.718 Yeah, and just to dovetail on that, 01:32:02.718 --> 01:32:05.060 I'm not opposed to any of this. 01:32:05.060 --> 01:32:07.580 Even if you lump sum it, 01:32:07.580 --> 01:32:09.020 I put this in the context of look, 01:32:09.020 --> 01:32:12.631 we've got $1.4 billion a year going out the door 01:32:12.631 --> 01:32:16.770 on transmission congestion costs. 01:32:16.770 --> 01:32:18.417 So anything that helps to offset that 01:32:18.417 --> 01:32:20.220 and you're in one of those prone areas 01:32:20.220 --> 01:32:23.300 of the state that helps you operate more efficiently, 01:32:23.300 --> 01:32:26.690 and again, load growth is coming in that area. 01:32:26.690 --> 01:32:30.120 So no, I wouldn't slam the door closed 01:32:30.120 --> 01:32:30.953 on any of this. 01:32:30.953 --> 01:32:33.590 It's just a question of how to most efficiently do it 01:32:33.590 --> 01:32:34.933 and hit your targets. 01:32:39.670 --> 01:32:41.790 So I think one of the, 01:32:41.790 --> 01:32:42.940 and please correct me if I'm wrong, 01:32:42.940 --> 01:32:46.450 but it sounds like to me that when you build 01:32:46.450 --> 01:32:49.320 a 345 kb double-circuit capable line, 01:32:49.320 --> 01:32:52.595 as you did, and part of it was in I guess 2010 01:32:52.595 --> 01:32:54.140 and the other part of it was in 2016, 01:32:54.140 --> 01:32:55.500 it seems like the longer you wait, 01:32:55.500 --> 01:32:57.470 the more the system changes. 01:32:57.470 --> 01:33:01.470 And you end up dropping a radial line 01:33:01.470 --> 01:33:04.110 to some wind farms and some lines 01:33:04.110 --> 01:33:08.330 and it makes it harder to add the second circuit later on. 01:33:08.330 --> 01:33:10.287 Depending on what region of the state you're in 01:33:10.287 --> 01:33:14.613 and what the factors are, it just seems to get complicated. 01:33:16.780 --> 01:33:21.780 Yeah, I would say, if the second circuit were there, 01:33:21.780 --> 01:33:24.210 what we would do to connect those generators 01:33:24.210 --> 01:33:26.200 would be the same as where we're gonna end up. 01:33:26.200 --> 01:33:28.750 We would still have to build a station 01:33:28.750 --> 01:33:31.230 on that second circuit and then run a radial line 01:33:31.230 --> 01:33:32.400 out to the generator. 01:33:32.400 --> 01:33:35.191 So what we end up with will be the same 01:33:35.191 --> 01:33:37.270 as if the second circuit had been there, 01:33:37.270 --> 01:33:40.290 we're just doing it in a little different order. 01:33:40.290 --> 01:33:43.060 So, and you might have already answered, 01:33:43.060 --> 01:33:43.893 Commissioner Glotfelty, 01:33:43.893 --> 01:33:47.631 but how much would those substations cost? 01:33:47.631 --> 01:33:49.024 A ballpark figure. 01:33:49.024 --> 01:33:53.070 Those are in the 15, $16 million range. 01:33:53.070 --> 01:33:56.010 So you're talking about 45, 50 million 01:33:56.010 --> 01:33:58.440 for those three stations 01:33:58.440 --> 01:34:01.030 and then you've also got station expansions 01:34:01.030 --> 01:34:03.853 at the other intermediate stations along the way, 01:34:04.820 --> 01:34:06.620 just to terminate the new circuit. 01:34:06.620 --> 01:34:09.880 So we have to add terminals at the other stations 01:34:09.880 --> 01:34:11.248 just for adding the second circuit. 01:34:11.248 --> 01:34:13.110 Just those three stations lone 01:34:13.110 --> 01:34:15.363 is in the 45, $50 million range. 01:34:16.430 --> 01:34:19.750 Okay, so thank you. 01:34:19.750 --> 01:34:21.380 And Woody, do you have any more to add 01:34:21.380 --> 01:34:24.860 on that slide that covers the interim options? 01:34:24.860 --> 01:34:26.100 With respect to the loop, 01:34:26.100 --> 01:34:28.515 can you give me some background on that 01:34:28.515 --> 01:34:30.598 and what are ERCOT's ultimate recommendations 01:34:30.598 --> 01:34:34.040 on the second, on the little close the loop project? 01:34:34.040 --> 01:34:35.810 On the closing the loop project? 01:34:35.810 --> 01:34:39.679 It's not part of our reliability recommendation. 01:34:39.679 --> 01:34:42.283 It has benefit. 01:34:43.800 --> 01:34:46.010 You can serve more load with the loop closed. 01:34:46.010 --> 01:34:49.000 It gives you more operational flexibility. 01:34:49.000 --> 01:34:54.000 But our reliability recommendation is that option two, 01:34:54.900 --> 01:34:57.379 building a new line down from San Miguel 01:34:57.379 --> 01:34:59.400 in the crosspiece as well. 01:34:59.400 --> 01:35:01.133 But not the double circuit? 01:35:02.950 --> 01:35:05.150 No, that's not part of our recommendation. 01:35:06.170 --> 01:35:07.310 Part of your recommendation 01:35:07.310 --> 01:35:08.763 for long-term reliability. 01:35:08.763 --> 01:35:10.190 Right. 01:35:10.190 --> 01:35:14.290 But we're doing both, provide more reliability benefits 01:35:14.290 --> 01:35:15.123 together? 01:35:15.123 --> 01:35:16.900 Closing the loop, adding the second circuit 01:35:16.900 --> 01:35:21.440 definitely that has benefit to the Rio Grande Valley 01:35:21.440 --> 01:35:22.510 in terms of reliability. 01:35:22.510 --> 01:35:23.803 There is benefit there. 01:35:25.890 --> 01:35:28.120 Our recommendation is the option two 01:35:29.510 --> 01:35:32.580 and we just don't wanna see anything delay that 01:35:32.580 --> 01:35:34.802 because that is the fix that we need 01:35:34.802 --> 01:35:38.173 to get out of this just-in-time, 01:35:39.220 --> 01:35:42.290 having things ready just in time for the next piece 01:35:42.290 --> 01:35:43.123 of load growth. 01:35:43.123 --> 01:35:44.100 Like option two. 01:35:44.100 --> 01:35:46.620 Option two would be a- 01:35:46.620 --> 01:35:47.770 Just-in-time. 01:35:48.769 --> 01:35:52.530 It would be a step change in what we've done in the past. 01:35:52.530 --> 01:35:54.430 For example, what we've done in the past is 01:35:54.430 --> 01:35:58.340 if we were gonna build a double-circuit capable line 01:35:58.340 --> 01:36:00.450 into the valley, we would look at it 01:36:00.450 --> 01:36:04.470 and we would say one circuit is adequate 01:36:04.470 --> 01:36:06.080 to serve the load for the next five years. 01:36:06.080 --> 01:36:09.600 So let's just fund one circuit. 01:36:09.600 --> 01:36:12.250 That will get us through the next five years. 01:36:12.250 --> 01:36:14.990 And then we look and say well load growth is up now 01:36:14.990 --> 01:36:17.240 so we need to add the second circuit. 01:36:17.240 --> 01:36:22.240 But what this is is kind of a kickstart 01:36:24.500 --> 01:36:28.070 all the way to 2040 and it gets you above 01:36:28.070 --> 01:36:29.370 that just-in-time mentality. 01:36:29.370 --> 01:36:34.370 And the reason that just-in-time mentality is a problem 01:36:34.860 --> 01:36:35.990 in the Rio Grande Valley is because 01:36:35.990 --> 01:36:38.350 of all those reasons I listed before. 01:36:38.350 --> 01:36:41.470 It's isolated, hurricane, limited generation, 01:36:41.470 --> 01:36:46.100 lots of RR being built there. 01:36:46.100 --> 01:36:49.900 So all those factors add up there to make, 01:36:49.900 --> 01:36:53.130 I mentioned before, it stretches our planning criteria. 01:36:53.130 --> 01:36:57.300 So if our planning criteria has some flaws in it 01:36:57.300 --> 01:37:00.703 or some holes in it, the Rio Grande Valley exposes those. 01:37:01.700 --> 01:37:03.610 That's what makes that unique. 01:37:03.610 --> 01:37:05.122 And we've seen this a little bit before 01:37:05.122 --> 01:37:08.260 in Far West Texas. 01:37:08.260 --> 01:37:11.453 Once again, fast load growth, on the edge of the system- 01:37:11.453 --> 01:37:14.420 At the end of the line. Needs big changes 01:37:14.420 --> 01:37:17.350 to catch up with and we were in the same kind 01:37:17.350 --> 01:37:22.240 of situation in serving that area as well, 01:37:22.240 --> 01:37:24.250 struggling between just-in-time fixes, 01:37:24.250 --> 01:37:28.890 small, incremental fixes versus large step changes. 01:37:28.890 --> 01:37:33.890 And I think you see that on the edges of our system. 01:37:34.290 --> 01:37:36.300 You see it in places where load growth 01:37:36.300 --> 01:37:40.233 is exceptionally high or higher than what we normally see. 01:37:41.179 --> 01:37:42.960 So what I'm hearing you say, Woody, 01:37:42.960 --> 01:37:47.960 is that if ERCOT wanted us to pick a path going forward, 01:37:47.980 --> 01:37:50.440 it would be the long-term, option two solution. 01:37:50.440 --> 01:37:53.560 Right. But if the Commission wanted 01:37:53.560 --> 01:37:55.560 to move forward with two projects, 01:37:55.560 --> 01:37:58.460 one being the long-term and one being the second circuit, 01:37:58.460 --> 01:38:01.351 that together would provide reliability. 01:38:01.351 --> 01:38:02.540 That's right, my control room, 01:38:02.540 --> 01:38:04.830 my outage coordinators, my planners, 01:38:04.830 --> 01:38:07.210 they all would prefer both 01:38:07.210 --> 01:38:09.650 from a operating the system standpoint. 01:38:09.650 --> 01:38:13.010 Okay, would your operators, planners, 01:38:13.010 --> 01:38:16.110 control room have reliability concerns 01:38:16.110 --> 01:38:17.300 with adding the second circuit 01:38:17.300 --> 01:38:20.630 if it was done appropriately in coordination with ERCOT's 01:38:20.630 --> 01:38:23.530 processes and even if it was done hot? 01:38:23.530 --> 01:38:26.650 We don't want to present a risk to existing reliability 01:38:26.650 --> 01:38:31.440 in the Valley and I need to hear it clear and now. 01:38:31.440 --> 01:38:34.653 Okay, so here's as clear as I can state it. 01:38:36.120 --> 01:38:39.073 Strictly speaking with our planning criteria, 01:38:39.073 --> 01:38:41.200 it would not be an issue there 01:38:41.200 --> 01:38:44.160 because we should be fine through 2026 01:38:45.240 --> 01:38:49.880 and the second circuit can be added before then. 01:38:49.880 --> 01:38:54.880 However, we are one bad hurricane away 01:38:55.670 --> 01:38:57.353 from losing the 345 line. 01:38:58.320 --> 01:39:01.050 The thermal generation that's in the Valley 01:39:01.050 --> 01:39:01.900 is getting older. 01:39:03.694 --> 01:39:08.694 A six-month overhaul of one of those units 01:39:08.830 --> 01:39:10.590 that occurs over the summer would put us 01:39:10.590 --> 01:39:11.657 in a really bad place. 01:39:11.657 --> 01:39:15.503 And our planning criteria doesn't compensate for that. 01:39:16.570 --> 01:39:19.700 So if we continue business as usual 01:39:19.700 --> 01:39:22.180 and we don't have those kinds of bad outages, 01:39:22.180 --> 01:39:24.680 then I think that would be fine. 01:39:24.680 --> 01:39:28.880 However, we're right there in the yellow zone. 01:39:28.880 --> 01:39:32.720 We're one bad thing away from losing 01:39:32.720 --> 01:39:35.870 one of those key pieces that serves load down there. 01:39:35.870 --> 01:39:40.190 We got the three lines and four big units 01:39:40.190 --> 01:39:41.210 or three big units. 01:39:41.210 --> 01:39:46.210 Are the eastern lines, are they double-circuited 01:39:49.410 --> 01:39:50.500 or are they single circuits? 01:39:50.500 --> 01:39:51.410 They're double circuits. 01:39:51.410 --> 01:39:52.500 Okay. 01:39:52.500 --> 01:39:54.910 But the hurricane pole lines are double circuit? 01:39:55.799 --> 01:39:56.730 I'm gonna have questions. 01:39:56.730 --> 01:39:57.563 You'll like it. 01:39:58.670 --> 01:40:00.523 So put it another way, 01:40:01.750 --> 01:40:05.530 second circuit on the western edge 01:40:05.530 --> 01:40:08.650 in the near-term provides a near-term level 01:40:08.650 --> 01:40:13.650 of redundancy sooner than you have 01:40:13.880 --> 01:40:15.913 to guard against hurricane disruption, 01:40:16.790 --> 01:40:19.100 generator outages, because what we're learning 01:40:19.100 --> 01:40:20.513 is that it's happening, 01:40:22.160 --> 01:40:26.270 and any type of unforeseen event in the near-term. 01:40:26.270 --> 01:40:29.390 It gets you there quicker but ultimately 01:40:29.390 --> 01:40:32.550 the path down the middle of south Texas, 01:40:32.550 --> 01:40:36.540 again, option two, gets us that long-term breathing room 01:40:36.540 --> 01:40:39.190 to where we can absorb any potential scenarios 01:40:39.190 --> 01:40:41.020 of load growth well into the future. 01:40:41.020 --> 01:40:42.010 That's right. 01:40:42.010 --> 01:40:45.993 You go back to my tachometer analogy, 01:40:47.240 --> 01:40:49.040 four years from now, we're gonna be sitting here 01:40:49.040 --> 01:40:50.600 and we're still gonna be in the yellow. 01:40:50.600 --> 01:40:52.540 Yeah, I hear you. 01:40:52.540 --> 01:40:56.450 Adding a second circuit doesn't add another pathway 01:40:56.450 --> 01:40:57.283 into the Valley. 01:40:57.283 --> 01:40:59.500 You have three now, you'll have three then. 01:40:59.500 --> 01:41:01.180 Right, but it gives you a crutch to lean on 01:41:01.180 --> 01:41:02.370 if something bad happens. It gives you a crutch 01:41:02.370 --> 01:41:03.290 to lean on, that's right. 01:41:03.290 --> 01:41:04.123 But it doesn't- 01:41:04.123 --> 01:41:07.500 Or if God forbid, the option two construction 01:41:07.500 --> 01:41:11.330 isn't completed exactly in time, 01:41:11.330 --> 01:41:14.440 precisely on the date in 2026. 01:41:14.440 --> 01:41:16.240 I know that's never happened before. 01:41:18.170 --> 01:41:19.720 That is some insurance of that as well. 01:41:19.720 --> 01:41:24.010 Right, okay, so to kind of sum this up, 01:41:24.010 --> 01:41:27.633 we can wrap up this part of the presentation. 01:41:28.670 --> 01:41:33.670 It sounds like with respect to the long-erm project, 01:41:34.000 --> 01:41:36.980 option two, we all agree that it's important 01:41:36.980 --> 01:41:38.580 for the Rio Grande Valley and we want 01:41:38.580 --> 01:41:41.383 to see that project continue to go forward at ERCOT. 01:41:42.580 --> 01:41:47.440 I would recommend that we request from ERCOT 01:41:47.440 --> 01:41:50.643 that we have that project endorsed by the end of the year. 01:41:50.643 --> 01:41:51.740 Okay. Okay, 01:41:51.740 --> 01:41:53.260 so by the end of the year. 01:41:53.260 --> 01:41:55.025 Through the standard, current process. 01:41:55.025 --> 01:41:56.763 The normal process. Through the normal process 01:41:56.763 --> 01:41:59.940 and for ERCOT to deem it critical for liability 01:41:59.940 --> 01:42:02.400 so that when we get the CCN we can process it 01:42:02.400 --> 01:42:03.403 in six months. 01:42:04.580 --> 01:42:05.870 And then I would like to hear 01:42:05.870 --> 01:42:08.780 from the companies and their counsel 01:42:09.987 --> 01:42:12.960 how quickly they can put together a CCN application 01:42:12.960 --> 01:42:17.270 because we wanna wrap up this long-term project 01:42:17.270 --> 01:42:18.490 as fast as we can. 01:42:18.490 --> 01:42:22.190 So if we don't have a timeline estimate here today, 01:42:22.190 --> 01:42:25.470 file one and let us know. 01:42:25.470 --> 01:42:28.640 And I would also say, as you get ready to file a CCN, 01:42:28.640 --> 01:42:31.140 because we're basically saying right now today 01:42:32.311 --> 01:42:34.461 that we support ERCOT and their option two. 01:42:35.853 --> 01:42:39.370 So that's enough guidance to start preparing your CCN 01:42:39.370 --> 01:42:41.890 and I would also say that when you file that CCN, 01:42:41.890 --> 01:42:44.500 prepare to file your direct testimony at the same time 01:42:44.500 --> 01:42:45.750 so that we can save time. 01:42:46.870 --> 01:42:47.960 And then we'll look to see what 01:42:47.960 --> 01:42:50.250 other procedural efficiencies we can squeeze out 01:42:50.250 --> 01:42:52.320 within that six month timeframe. 01:42:52.320 --> 01:42:55.910 That would be my recommendation for the long-term project. 01:42:57.190 --> 01:43:00.150 Can I ask a couple of things? 01:43:00.150 --> 01:43:05.150 First of all, Woody, you kind of hit a nerve with me 01:43:07.350 --> 01:43:08.450 with something that I don't like 01:43:08.450 --> 01:43:12.580 about reliability assessments that come from NERC or any RTO 01:43:12.580 --> 01:43:15.870 is they go, we're gonna be great for the winter except 01:43:15.870 --> 01:43:17.640 or however. 01:43:17.640 --> 01:43:18.980 It's always the contingency. 01:43:18.980 --> 01:43:20.740 If one big generator trips or 01:43:20.740 --> 01:43:23.120 if one big transmission line fails. 01:43:23.120 --> 01:43:25.020 And that's what we found ourselves in. 01:43:25.920 --> 01:43:29.860 And I know that's planning criteria across the US 01:43:29.860 --> 01:43:31.850 but we have to be more diligent about it than that. 01:43:31.850 --> 01:43:34.440 And I hope we could get, 01:43:34.440 --> 01:43:35.790 and obviously there's a cost here, 01:43:35.790 --> 01:43:38.720 but we could get to the place where it's, 01:43:38.720 --> 01:43:41.300 even if we have one of those circuits in the Valley go down, 01:43:41.300 --> 01:43:44.063 we are still gonna be okay in the Rio Grande Valley. 01:43:44.990 --> 01:43:46.313 If we do have a hurricane. 01:43:47.240 --> 01:43:49.930 And that's where we need to think about this 01:43:49.930 --> 01:43:51.793 from a reliability perspective. 01:43:56.310 --> 01:43:59.200 Obviously, the cost of reliability goes up 01:43:59.200 --> 01:44:01.120 the more reliable you want the system. 01:44:01.120 --> 01:44:06.120 But to me, just in time's not getting it. 01:44:06.290 --> 01:44:08.010 I said a couple of open meetings ago, 01:44:08.010 --> 01:44:11.250 the fact that quote/unquote, we gold-plated the system 01:44:11.250 --> 01:44:13.398 or people were accused of gold-plating the system 01:44:13.398 --> 01:44:17.390 when we built coal and nuclear plants, thank God. 01:44:17.390 --> 01:44:18.223 Guess what? 01:44:18.223 --> 01:44:21.763 We're using all of that capacity today and it's needed. 01:44:22.800 --> 01:44:24.610 So I want you all to think ahead. 01:44:24.610 --> 01:44:28.110 I want you all to think about these towers 01:44:28.110 --> 01:44:29.270 that you can add a second circuit. 01:44:29.270 --> 01:44:32.320 I want you to think about these big time reliability 01:44:32.320 --> 01:44:34.573 projects that are necessary for 2040. 01:44:35.530 --> 01:44:37.400 We're not gonna get too many bites at the apple, 01:44:37.400 --> 01:44:38.693 I don't believe. 01:44:38.693 --> 01:44:41.373 And I'm not saying that all transmission, 01:44:42.620 --> 01:44:45.210 this isn't a run to the PUC to put every bit 01:44:45.210 --> 01:44:49.210 of transmission we can in the rate base, 01:44:49.210 --> 01:44:50.310 I don't believe that. 01:44:50.310 --> 01:44:54.330 But there are projects that are needed 01:44:54.330 --> 01:44:56.520 that I hope we can use our authority. 01:44:56.520 --> 01:44:58.810 I think the legislature has been clear, 01:44:58.810 --> 01:45:01.090 the Governor has been clear and other leaders, 01:45:01.090 --> 01:45:02.360 let's get it done. 01:45:02.360 --> 01:45:04.670 And we want to take advantage of that 01:45:04.670 --> 01:45:06.570 and make sure that Texans are protected 01:45:06.570 --> 01:45:10.420 and Texans are served by more reliable systems. 01:45:10.420 --> 01:45:13.080 And a lot of that, in my belief, 01:45:13.080 --> 01:45:17.830 is that the generation costs continues to go down. 01:45:17.830 --> 01:45:19.750 We may be putting a little bit more in transmission 01:45:19.750 --> 01:45:21.950 but generation keeps coming down 01:45:21.950 --> 01:45:24.950 and we're gonna have other issues we've gotta deal with 01:45:24.950 --> 01:45:28.040 with inverter-based generation and storage 01:45:28.040 --> 01:45:28.873 and all those things. 01:45:28.873 --> 01:45:33.610 But it's all dependent upon a robust transmission system. 01:45:33.610 --> 01:45:36.820 So the one other thing that I wanted to ask is, 01:45:36.820 --> 01:45:41.820 when you think about the option two or option B, 01:45:43.140 --> 01:45:45.260 did you only look at 345? 01:45:45.260 --> 01:45:46.700 I continue to struggle with the fact 01:45:46.700 --> 01:45:49.640 that we're one of the only regions that have 01:45:50.690 --> 01:45:53.640 the upper limit of our transmission stops at 345. 01:45:53.640 --> 01:45:56.240 And I know some of it is because of underbuild issues 01:45:56.240 --> 01:46:00.570 and the requirement that you put in a 500 line. 01:46:00.570 --> 01:46:03.110 We may have a lot more underbuild to do as well 01:46:03.110 --> 01:46:05.150 but have you looked at the scenario? 01:46:05.150 --> 01:46:07.670 I know you all advocate for 765 01:46:07.670 --> 01:46:10.268 but has ERCOT or AUP thought about using that? 01:46:10.268 --> 01:46:15.268 And would that provide any more reliability 01:46:15.390 --> 01:46:17.240 or value to the Rio Grande Valley 01:46:17.240 --> 01:46:18.940 if you went with a higher voltage? 01:46:19.990 --> 01:46:22.700 Yeah, we have considered that 01:46:22.700 --> 01:46:25.913 in a number of, obviously during the CREZ process, 01:46:25.913 --> 01:46:27.550 it's something that was considered. 01:46:27.550 --> 01:46:29.850 And kind of to your point, 01:46:29.850 --> 01:46:34.850 the way I think about 765 is it's not a onesy twosy, 01:46:35.850 --> 01:46:37.780 for the reasons you just said, 01:46:37.780 --> 01:46:41.120 if you have one 765 kb line or two. 01:46:41.120 --> 01:46:44.194 The problem is, when you lose that line, what happens? 01:46:44.194 --> 01:46:48.030 And so in my mind, it's something you have 01:46:48.030 --> 01:46:50.640 to kind of make that commitment to and work 01:46:50.640 --> 01:46:52.760 towards building out at least some sort 01:46:52.760 --> 01:46:55.810 of a backbone at that voltage 01:46:55.810 --> 01:46:59.040 in order to then have that to organically grow from 01:46:59.040 --> 01:47:00.370 and make it work. 01:47:00.370 --> 01:47:02.470 And so in this particular case 01:47:02.470 --> 01:47:05.280 when you're looking at building one new line 01:47:05.280 --> 01:47:08.690 to the Valley, does it make sense to do it at 765? 01:47:08.690 --> 01:47:12.011 Probably not, right, for the reasons I just said. 01:47:12.011 --> 01:47:16.580 It's more expensive and then obviously you have the issues 01:47:16.580 --> 01:47:20.082 to deal with if you lose it, what happens? 01:47:20.082 --> 01:47:22.690 But if you lose it, you still have three others 01:47:22.690 --> 01:47:26.150 that might be able to be the contingency on that. 01:47:26.150 --> 01:47:30.120 I guess what I would say, I'd love for y'all to look at it. 01:47:30.120 --> 01:47:31.940 I'd love for y'all to think higher. 01:47:31.940 --> 01:47:36.940 Think not 2022 but 2032. 01:47:37.000 --> 01:47:39.810 Yeah, just let me clarify your statement there. 01:47:39.810 --> 01:47:44.390 The concern with building 500 or 760 kb 01:47:44.390 --> 01:47:47.450 is that it is so good at delivering high amounts 01:47:47.450 --> 01:47:49.960 of power and high volumes of supply of power, 01:47:49.960 --> 01:47:52.020 it's so good at its job 01:47:52.020 --> 01:47:53.950 that if you lost it for a little while, 01:47:53.950 --> 01:47:55.650 it's not worth building it at all. 01:47:56.820 --> 01:47:58.190 Uh, no. Fill in the gaps 01:47:58.190 --> 01:47:59.440 for me there. (spectators laughing) 01:47:59.440 --> 01:48:00.440 I'm sorry. 01:48:03.149 --> 01:48:05.460 I just don't understand why you wouldn't want 01:48:05.460 --> 01:48:08.630 to build something that is extremely good at its job 01:48:08.630 --> 01:48:10.120 because you might not be able to use it 01:48:10.120 --> 01:48:11.250 a couple of days a year. 01:48:11.250 --> 01:48:13.160 Well, it's just, when it goes out, 01:48:13.160 --> 01:48:16.440 then you have a significant amount of power that- 01:48:16.440 --> 01:48:20.840 Okay, sure, if you said, I don't want to build a 760 kb 01:48:20.840 --> 01:48:22.940 because it's a single point of failure 01:48:22.940 --> 01:48:25.603 for more people than a 345 is. 01:48:27.040 --> 01:48:29.360 And so instead of that, I'm gonna build 01:48:29.360 --> 01:48:33.760 two separate 345s that provide offsetting risks 01:48:33.760 --> 01:48:36.102 to each other in different areas 01:48:36.102 --> 01:48:38.278 and one's on the coast, one's not. 01:48:38.278 --> 01:48:40.060 And so therefore I've reduced my risk 01:48:40.060 --> 01:48:41.380 of a single point of failure. 01:48:41.380 --> 01:48:43.700 If you said that, that would make sense. 01:48:43.700 --> 01:48:45.040 But what I'm hearing is, 01:48:45.040 --> 01:48:47.650 we're only gonna build the one line and option two. 01:48:47.650 --> 01:48:50.140 And instead of building a really big one that delivers 01:48:50.140 --> 01:48:53.571 a lot of power to ensure reliability for a really long time, 01:48:53.571 --> 01:48:56.480 we're not building more to reduce risks, 01:48:56.480 --> 01:48:58.330 we're just gonna build a smaller one. 01:49:00.745 --> 01:49:03.190 Help me fill in, I mean, somebody help me here. 01:49:03.190 --> 01:49:04.700 Yeah, I think it has to do. 01:49:04.700 --> 01:49:08.130 I mean, really this is a reliability issue. 01:49:08.130 --> 01:49:10.330 And that is when you talk underbuilds, 01:49:10.330 --> 01:49:13.090 you talk about if that 500 kb line trips 01:49:13.090 --> 01:49:15.763 or that 765, where is that power going? 01:49:17.170 --> 01:49:18.702 The generators are still generating. 01:49:18.702 --> 01:49:19.535 Sure. 01:49:19.535 --> 01:49:20.368 The load is still there. 01:49:20.368 --> 01:49:22.693 So the rest of the system has to pick that up 01:49:22.693 --> 01:49:25.370 or you're gonna have potentially outages. 01:49:25.370 --> 01:49:27.490 Lines are gonna trip generators are gonna trip. 01:49:27.490 --> 01:49:32.490 So the question is, I think, the cost of a 345, 01:49:33.890 --> 01:49:36.345 knowing that you don't have do any underbuilds 01:49:36.345 --> 01:49:39.070 or the cost of a 500 and a 765, 01:49:39.070 --> 01:49:42.250 knowing that that's a higher cost structure, 01:49:42.250 --> 01:49:44.440 but then you're gonna have to do additional work 01:49:44.440 --> 01:49:47.760 to ensure that that contingency, if a contingency happens, 01:49:47.760 --> 01:49:48.593 that that fails. 01:49:48.593 --> 01:49:50.950 Okay. And I kind of wonder 01:49:50.950 --> 01:49:54.900 is does the second circuit on the western line 01:49:54.900 --> 01:49:56.400 help that contingency. 01:49:56.400 --> 01:49:58.290 Help defray just loading a- 01:49:58.290 --> 01:50:00.970 That's right, a single circuit 345. 01:50:00.970 --> 01:50:03.600 What worries me about this entire conversation, 01:50:03.600 --> 01:50:07.940 two part, is that under this framework of thinking, 01:50:07.940 --> 01:50:11.010 we're never having a 760 line in Texas, ever. 01:50:11.010 --> 01:50:12.373 You're not even headed to saying we're never having 01:50:12.373 --> 01:50:13.603 a 760 line. 01:50:14.520 --> 01:50:18.050 I think if you want to move to 765, 01:50:18.050 --> 01:50:20.963 you've gotta build an entire 765 system. 01:50:22.050 --> 01:50:23.980 You can't just build one line. That's right. 01:50:23.980 --> 01:50:26.530 I realize that- That's the step change 01:50:26.530 --> 01:50:27.363 we're talking about. 01:50:27.363 --> 01:50:31.250 And so instead of $1.3 billion, we're talking 01:50:31.250 --> 01:50:35.510 about 20 or $30 billion. 01:50:35.510 --> 01:50:37.150 I mean it's a lot- Not for that line 01:50:37.150 --> 01:50:38.963 but for a system. For a system. 01:50:38.963 --> 01:50:41.570 I mean, it's a huge step change. 01:50:41.570 --> 01:50:44.230 But other regions have it. 01:50:44.230 --> 01:50:46.343 Did they do it in 30 billion chunks too? 01:50:47.520 --> 01:50:48.353 I don't know. 01:50:48.353 --> 01:50:51.690 AUP, they're really the premier 765 builders 01:50:51.690 --> 01:50:52.850 across the US. 01:50:52.850 --> 01:50:56.270 But 500s are used in lots of different regions as well 01:50:56.270 --> 01:51:00.680 and I'd put it out there for food for thought 01:51:00.680 --> 01:51:04.490 that thinking positively in the future 01:51:04.490 --> 01:51:05.883 about these higher voltage. 01:51:07.090 --> 01:51:09.230 Maybe now is the time, maybe now is not the time. 01:51:09.230 --> 01:51:10.380 I don't know. 01:51:10.380 --> 01:51:11.284 But I'm saying now is the time- 01:51:11.284 --> 01:51:12.650 Well, a blanket no is not the answer. 01:51:12.650 --> 01:51:14.310 A blanket no is not the answer. 01:51:14.310 --> 01:51:15.590 Yeah, a blanket no is not the answer 01:51:15.590 --> 01:51:17.770 and no, I don't even wanna look at it right now 01:51:17.770 --> 01:51:19.050 is not the answer. 01:51:19.050 --> 01:51:19.883 Absolutely. 01:51:19.883 --> 01:51:23.990 And this kind of circular logic of no, 01:51:23.990 --> 01:51:25.600 we can't do it right now. 01:51:25.600 --> 01:51:27.050 And I understand, y'all are constrained 01:51:27.050 --> 01:51:28.601 by the current process. 01:51:28.601 --> 01:51:31.030 But the circular logic both applying 01:51:31.030 --> 01:51:31.970 to no, we're not gonna do 500. 01:51:31.970 --> 01:51:35.270 We're not gonna do 700 now because it doesn't fit 01:51:35.270 --> 01:51:36.103 and we're not gonna do it, 01:51:36.103 --> 01:51:38.651 just like we're not gonna do a second circuit band-aid 01:51:38.651 --> 01:51:40.135 because we don't like band-aids, 01:51:40.135 --> 01:51:43.520 we wanna do the billion dollars first. 01:51:43.520 --> 01:51:45.820 The band-aid didn't get done anyway 01:51:45.820 --> 01:51:47.490 because band-aids just leave you 01:51:47.490 --> 01:51:50.369 in a just-in-time danger zone. 01:51:50.369 --> 01:51:52.150 Well, not doing the band-aid got us 01:51:52.150 --> 01:51:53.810 in a Just-in-time danger zone anyway. 01:51:53.810 --> 01:51:57.850 And it's this circular framework across the board 01:51:57.850 --> 01:52:00.790 in this process that is very, very concerning. 01:52:00.790 --> 01:52:05.280 And I'm immensely grateful that you're sorting through this 01:52:05.280 --> 01:52:07.730 because I'm starting to see why we haven't gotten 01:52:09.204 --> 01:52:11.240 a lot of projects done that we've needed in the state. 01:52:11.240 --> 01:52:13.280 And it has been a ride. (spectators laughing) 01:52:13.280 --> 01:52:18.159 So it was much more complicated than you would ever think 01:52:18.159 --> 01:52:20.310 evaluating the second circuit. 01:52:20.310 --> 01:52:23.360 So to just frame up the conversation, 01:52:23.360 --> 01:52:24.950 and you made a really good point, 01:52:24.950 --> 01:52:27.100 Commissioner Glotfelty, earlier, 01:52:27.100 --> 01:52:29.300 the reason we're having this conversation here today 01:52:29.300 --> 01:52:31.300 is because the legislature and the Governor 01:52:31.300 --> 01:52:33.320 want us to ensure reliability. 01:52:33.320 --> 01:52:35.830 And one component of that is looking 01:52:35.830 --> 01:52:38.390 at the acceleration of transmission development. 01:52:38.390 --> 01:52:42.077 And we, as a Commission, we as a Commission, 01:52:42.077 --> 01:52:44.600 are looking at that together. 01:52:44.600 --> 01:52:47.240 And although the Chairman has assigned me 01:52:47.240 --> 01:52:49.620 this very important project that I have worked 01:52:49.620 --> 01:52:52.290 very hard on over the last several weeks, 01:52:52.290 --> 01:52:54.540 we as a Commission are making a decision, 01:52:54.540 --> 01:52:56.983 we as a Commission are evaluating these issues. 01:52:59.024 --> 01:53:00.674 I just wanna make that real clear 01:53:03.400 --> 01:53:08.210 because it seems that there might be some thinking 01:53:08.210 --> 01:53:10.370 that I'm the only one interested 01:53:11.375 --> 01:53:13.170 in looking at these options. 01:53:13.170 --> 01:53:16.620 So I just wanna be real clear and on the record on that. 01:53:16.620 --> 01:53:19.250 And secondly, I wanna go back to again, 01:53:19.250 --> 01:53:20.760 trying to summarize this conversation 01:53:20.760 --> 01:53:23.590 to the long-term project. 01:53:23.590 --> 01:53:25.440 And as we stated here today, 01:53:25.440 --> 01:53:27.220 we want ERCOT to endorse the project 01:53:27.220 --> 01:53:30.610 by the end of the year and to deem it critical 01:53:30.610 --> 01:53:31.830 for reliability. 01:53:31.830 --> 01:53:33.330 If you don't have it done by the end of the year, 01:53:33.330 --> 01:53:36.448 then you need to give us an update- 01:53:36.448 --> 01:53:38.588 Okay, we will. 01:53:38.588 --> 01:53:40.650 Because we'll order it if we have to. 01:53:40.650 --> 01:53:41.629 Right? Yeah. 01:53:41.629 --> 01:53:45.140 And so it's gonna get done and we want the endorsement 01:53:45.140 --> 01:53:46.020 through the regular process. 01:53:46.020 --> 01:53:50.140 This is $1.2 billion so we want it to be vetted 01:53:50.140 --> 01:53:52.810 but we want it endorsed by the end of the year. 01:53:52.810 --> 01:53:55.870 And we want it deemed critical for reliability 01:53:55.870 --> 01:53:57.980 and we want the party or parties that are responsible 01:53:57.980 --> 01:54:00.340 for filing a CCN application at the Commission 01:54:00.340 --> 01:54:02.050 to provide us with their best case, 01:54:02.050 --> 01:54:04.270 most efficient timeline for how long it's gonna take 01:54:04.270 --> 01:54:05.483 to file the CCN. 01:54:08.150 --> 01:54:10.580 To file it in a project that Stephen will be talking 01:54:10.580 --> 01:54:14.173 about to us at the end of this long conversation. 01:54:15.810 --> 01:54:18.190 To file it with their direct testimony supporting 01:54:18.190 --> 01:54:21.700 their application to help expedite the CCN process 01:54:21.700 --> 01:54:24.533 once that project comes over here for our CCN review. 01:54:25.770 --> 01:54:27.053 Now we'll also say, 01:54:28.820 --> 01:54:31.420 well, I'll leave it to my next topic 01:54:31.420 --> 01:54:32.520 on the second circuit. 01:54:34.380 --> 01:54:36.887 Is I had conveyed last open meeting 01:54:36.887 --> 01:54:39.010 and we had broad statutory power 01:54:39.010 --> 01:54:41.520 to order the construction of transmission 01:54:41.520 --> 01:54:44.700 for safe and reliable to provide safety 01:54:44.700 --> 01:54:46.210 and reliability in the state. 01:54:46.210 --> 01:54:51.210 And so what I would like to understand 01:54:51.710 --> 01:54:54.640 from you all, if there's additional information 01:54:54.640 --> 01:54:56.166 y'all would want on the second circuit 01:54:56.166 --> 01:54:58.390 to be able to make a determination 01:54:58.390 --> 01:54:59.740 on whether we want to pull the trigger 01:54:59.740 --> 01:55:01.950 and use that authority or if you're comfortable 01:55:01.950 --> 01:55:04.530 making that decision here today. 01:55:04.530 --> 01:55:06.570 But before we take action, 01:55:06.570 --> 01:55:09.070 I really wanna make sure that we go back 01:55:09.070 --> 01:55:11.570 to Woody's statement that he abundantly made clear 01:55:11.570 --> 01:55:14.090 to us today that ERCOT would ensure 01:55:14.090 --> 01:55:16.770 that that second line would be put in place 01:55:16.770 --> 01:55:19.870 in a reliability manner where we would not create 01:55:19.870 --> 01:55:23.870 a reliability risk for the citizens of the Rio Grande Valley 01:55:23.870 --> 01:55:26.080 when we add that second circuit. 01:55:26.080 --> 01:55:27.980 We can do that with outage coordination, yes. 01:55:27.980 --> 01:55:29.800 And you can manage the outage risk. 01:55:29.800 --> 01:55:30.633 Right. 01:55:30.633 --> 01:55:32.020 That may delay the project but we'd rather 01:55:32.020 --> 01:55:33.320 manage the outage risk. 01:55:33.320 --> 01:55:34.710 We're not gonna approve outages 01:55:34.710 --> 01:55:36.803 that jeopardize our liability. 01:55:37.690 --> 01:55:38.900 Okay. 01:55:38.900 --> 01:55:42.480 And I also want to make clear again from you 01:55:42.480 --> 01:55:44.217 that you said together these two projects, 01:55:44.217 --> 01:55:48.687 the second circuit, from San Miguel to Palmito 01:55:50.060 --> 01:55:53.670 and the long-term project together provide 01:55:53.670 --> 01:55:56.170 significant reliability benefits 01:55:56.170 --> 01:55:57.470 for the Rio Grande Valley. 01:55:58.980 --> 01:56:00.330 That's true, yes. 01:56:01.420 --> 01:56:04.598 I'm not, yeah, keep going. 01:56:04.598 --> 01:56:08.450 Okay, so based on this feedback 01:56:08.450 --> 01:56:13.150 that I think is critical to our evaluation here today, 01:56:13.150 --> 01:56:14.270 I would like to understand from y'all 01:56:14.270 --> 01:56:17.800 if y'all are ready to order the construction 01:56:17.800 --> 01:56:18.850 of that second circuit, 01:56:18.850 --> 01:56:20.400 based on our broad statutory authority 01:56:20.400 --> 01:56:25.363 under 35.005, subsection B, 39.203, subsection E. 01:56:27.550 --> 01:56:29.115 I take it you're ready. 01:56:29.115 --> 01:56:30.096 Just a guess. 01:56:30.096 --> 01:56:31.824 Well, I just wanna hear from y'all. 01:56:31.824 --> 01:56:33.751 Okay. I'm waiting to hear. 01:56:33.751 --> 01:56:35.860 Wheen are we expected to have this thing energized 01:56:35.860 --> 01:56:37.339 if we order this today? 01:56:37.339 --> 01:56:38.200 When is it gonna be ready? 01:56:38.200 --> 01:56:39.570 When does it help out the Valley? 01:56:39.570 --> 01:56:40.623 What's your forecast? 01:56:41.640 --> 01:56:44.457 We were indicating about 34 months 01:56:44.457 --> 01:56:46.510 for our portion, 01:56:46.510 --> 01:56:49.690 and I think the other TSPs were within that as well. 01:56:49.690 --> 01:56:51.090 Okay, so we're looking at, 01:56:53.360 --> 01:56:57.300 okay, six years for the long-term fix. 01:56:57.300 --> 01:56:58.133 Yep. 01:57:02.270 --> 01:57:03.870 Three years of hurricane season. 01:57:06.210 --> 01:57:09.313 Okay, that's my question. 01:57:10.230 --> 01:57:11.650 What do you think? 01:57:11.650 --> 01:57:14.140 So, I'm trying not to surprise the court here 01:57:14.140 --> 01:57:17.420 but we actually have some fairly new information 01:57:17.420 --> 01:57:18.260 to bring to the group. 01:57:18.260 --> 01:57:19.560 Please state your name for the record and continue with- 01:57:19.560 --> 01:57:20.393 I'm sorry. 01:57:20.393 --> 01:57:22.430 Michael Quinn on behalf of the Cherryland Utilities. 01:57:22.430 --> 01:57:24.420 So, since we've had our original project 01:57:24.420 --> 01:57:26.630 approximately a month ago, we've had a large load 01:57:26.630 --> 01:57:29.770 come and approach us about siting in the Valley. 01:57:29.770 --> 01:57:33.180 And today we at 2021, 01:57:33.180 --> 01:57:36.300 we have 2800 megawatts worth of capacity. 01:57:36.300 --> 01:57:37.913 2027 is what he said 01:57:37.913 --> 01:57:41.920 we have 3200 megawatts worth of capacity. 01:57:41.920 --> 01:57:44.860 And so the second circuit buys us 01:57:44.860 --> 01:57:48.090 approximately 300 megawatts of additional capacity, 01:57:48.090 --> 01:57:51.530 based on the extrapolation from what ERCOT brought. 01:57:51.530 --> 01:57:54.433 So over the last month, we've had a load approach us, 01:57:54.433 --> 01:57:55.990 a very meaningful load. 01:57:55.990 --> 01:57:59.156 And if you'll allow me to be a little bit vague, 01:57:59.156 --> 01:58:02.910 it's not public information as to who and the size. 01:58:02.910 --> 01:58:05.940 But the way I would describe it is 01:58:07.620 --> 01:58:09.620 they are on a very aggressive timeline. 01:58:09.620 --> 01:58:12.760 I don't have a signed FEA today, 01:58:12.760 --> 01:58:14.770 that's the Facilities Extension Agreement. 01:58:14.770 --> 01:58:16.320 But we have vetted them enough 01:58:16.320 --> 01:58:18.980 and actually brought it to ERCOT within the last week, 01:58:18.980 --> 01:58:21.070 that's it's in the tune of 600 megawatts. 01:58:21.070 --> 01:58:23.190 And it's a highly controllable load, 01:58:23.190 --> 01:58:24.840 I would assume. 01:58:24.840 --> 01:58:28.630 Yes. (everyone laughing) 01:58:28.630 --> 01:58:30.530 I've only been chairman one day. 01:58:30.530 --> 01:58:31.593 Don't get me fired. 01:58:33.260 --> 01:58:35.610 A bit more information on that, please. 01:58:35.610 --> 01:58:37.477 This is wild stuff. 01:58:37.477 --> 01:58:39.680 And so I'm not trying to surprise anybody. 01:58:39.680 --> 01:58:41.830 We brought it to ERCOT, like I said, 01:58:41.830 --> 01:58:43.550 in the last week. 01:58:43.550 --> 01:58:46.840 And we believe the load is very credible. 01:58:46.840 --> 01:58:49.097 They have another facility in Texas 01:58:49.097 --> 01:58:52.370 that another utility is building out to 01:58:52.370 --> 01:58:57.370 so we believe the load is real. 01:58:57.450 --> 01:59:02.683 So absent the second circuit and the closed loop, 01:59:04.840 --> 01:59:07.023 I suggest that there's near-term risk. 01:59:09.430 --> 01:59:10.613 Yeah, so, 01:59:10.613 --> 01:59:11.740 oh yeah, go please. 01:59:11.740 --> 01:59:12.573 I'm sorry. 01:59:12.573 --> 01:59:14.150 Mr. Quinn, let me ask you a question. 01:59:14.150 --> 01:59:16.513 So you just got this new information 01:59:16.513 --> 01:59:17.346 and you believe- 01:59:17.346 --> 01:59:19.241 Over the last month and specific we brought 01:59:19.241 --> 01:59:20.520 it to ERCOT over the last week. 01:59:20.520 --> 01:59:22.400 And you're saying that, 01:59:22.400 --> 01:59:25.140 are you saying that it justifies closing the loop? 01:59:25.140 --> 01:59:28.670 So I'm happy to talk about closing the loop 01:59:28.670 --> 01:59:31.410 but I believe that in ERCOT's presentation, 01:59:31.410 --> 01:59:33.820 they suggested closing the loop 01:59:33.820 --> 01:59:37.790 plus the second circuit is what gets us 01:59:37.790 --> 01:59:40.470 to 310 megawatts of capacity. 01:59:40.470 --> 01:59:43.530 Now, I don't wanna put words in ERCOT's mouth, 01:59:43.530 --> 01:59:45.390 if they have a different number than that. 01:59:45.390 --> 01:59:46.470 So in other words, 01:59:46.470 --> 01:59:50.350 that 2026 projection for new capacity 01:59:50.350 --> 01:59:52.890 might be moving up. 01:59:52.890 --> 01:59:55.960 Yes, that's exactly what we're suggesting. 01:59:55.960 --> 02:00:00.660 So the band-aid might actually be more critical 02:00:00.660 --> 02:00:02.090 than previously thought. 02:00:02.090 --> 02:00:05.760 So the second circuit and closing the loop 02:00:05.760 --> 02:00:07.800 gives us a little bit of headroom. 02:00:07.800 --> 02:00:09.740 Not substantial, in my opinion, 02:00:09.740 --> 02:00:12.359 but it does allow us to serve that load 02:00:12.359 --> 02:00:13.980 safely and reliably. 02:00:13.980 --> 02:00:17.150 Now that's a conversation specific to Cherryland. 02:00:17.150 --> 02:00:19.860 I don't know what other conversations, 02:00:19.860 --> 02:00:22.900 Stack or AUP, is having with other loads. 02:00:22.900 --> 02:00:23.873 We see the, 02:00:25.050 --> 02:00:27.040 Commissioner, we're very much in your camp 02:00:27.040 --> 02:00:29.930 from the standpoint of, we see the near-term project 02:00:29.930 --> 02:00:31.710 and the long-term project as both. 02:00:31.710 --> 02:00:34.870 We see them as two sides of the same reliability coin. 02:00:34.870 --> 02:00:36.940 We see there's near-term needs 02:00:36.940 --> 02:00:38.450 and we're trying to address those with 02:00:38.450 --> 02:00:40.640 these quicker projects. 02:00:40.640 --> 02:00:43.849 We absolutely believe the right thing to do 02:00:43.849 --> 02:00:46.533 is to go forward with the Greenville Project as well. 02:00:48.600 --> 02:00:50.060 Woody, do you have any feedback 02:00:50.060 --> 02:00:53.080 on this new load or have y'all looked at it? 02:00:53.080 --> 02:00:55.717 We have the information they've provided us 02:00:55.717 --> 02:00:56.550 but nothing further. 02:00:56.550 --> 02:00:58.744 We don't know anymore about it than they do. 02:00:58.744 --> 02:00:59.577 Okay. 02:01:00.860 --> 02:01:04.100 I can tell you from AUP's perspective, 02:01:04.100 --> 02:01:07.590 we've also talked to several large loads as well. 02:01:07.590 --> 02:01:10.297 Don't have any commitments at this time 02:01:10.297 --> 02:01:12.147 but there is a lot of interest there. 02:01:13.472 --> 02:01:16.330 And so the proposal that Cherryland has provided 02:01:16.330 --> 02:01:19.240 for closing the loop includes both construction 02:01:19.240 --> 02:01:23.040 by Cherryland and AUP. 02:01:23.040 --> 02:01:26.713 Do you support this closing the loop? 02:01:27.600 --> 02:01:28.470 I do, yeah. 02:01:28.470 --> 02:01:30.990 And I agree with what was said here. 02:01:30.990 --> 02:01:33.550 Our analysis indicates that stringing 02:01:33.550 --> 02:01:35.100 that second circuit all the way 02:01:36.590 --> 02:01:39.980 from San Miguel to Palmito, closing the loop, 02:01:39.980 --> 02:01:41.660 gets us about 300 megawatts. 02:01:41.660 --> 02:01:44.850 That's consistent with our analysis as well. 02:01:44.850 --> 02:01:47.430 And by the way, I sincerely apologize 02:01:47.430 --> 02:01:50.780 for any confusion that we have caused on this issue. 02:01:50.780 --> 02:01:53.313 We do see value in that second circuit. 02:01:54.390 --> 02:01:58.190 And so I would confirm what ERCOT has said 02:01:58.190 --> 02:02:00.020 and what Cherryland has indicated 02:02:00.020 --> 02:02:04.077 regarding the improvement in capability associated with it. 02:02:04.077 --> 02:02:08.590 And we will stand by our 34-month timeline 02:02:08.590 --> 02:02:10.680 for getting that done, energized, 02:02:10.680 --> 02:02:12.030 so we can do that reliably. 02:02:13.560 --> 02:02:16.170 So I just want to make sure that it's properly framed 02:02:16.170 --> 02:02:19.520 for everybody, 'cause I know that the normal stakeholders 02:02:19.520 --> 02:02:21.760 who are very sensitive to transmission costs 02:02:21.760 --> 02:02:24.530 will come knocking. 02:02:24.530 --> 02:02:29.357 But we get near-term reliability solutions by 2024 02:02:32.241 --> 02:02:36.527 with a long-term reliability solution by 2027 02:02:38.777 --> 02:02:40.530 for the tune of this- 02:02:40.530 --> 02:02:43.130 We actually think we can probably do better than that. 02:02:43.130 --> 02:02:47.738 So possibly even by 2026, we could get the long-term. 02:02:47.738 --> 02:02:49.717 The other way to think about it is, 02:02:49.717 --> 02:02:52.610 I know we'll incur new costs and a significant cost 02:02:52.610 --> 02:02:54.680 but what is the cost of inaction? 02:02:54.680 --> 02:02:55.513 Exactly. 02:02:56.740 --> 02:02:59.960 So the way I think I envision it is 02:02:59.960 --> 02:03:04.450 if we move forward with ordering these interim options, 02:03:04.450 --> 02:03:07.100 which is the second circuit and the closing of the loop 02:03:07.100 --> 02:03:09.899 to provide more near-term reliability 02:03:09.899 --> 02:03:14.899 and load growth, load serving capability in the valley, 02:03:17.873 --> 02:03:22.340 those facilities would be in place about 2026, 02:03:22.340 --> 02:03:25.016 which is right before the reliability need arises, 02:03:25.016 --> 02:03:28.170 based on our cost modeling in 2027. 02:03:28.170 --> 02:03:31.680 And then followed by the new project that would be built 02:03:33.300 --> 02:03:34.710 after the reliability need. 02:03:34.710 --> 02:03:38.100 So we would have sort of a phased-in 02:03:38.100 --> 02:03:42.090 infrastructure build out to address the reliability needs 02:03:42.090 --> 02:03:44.100 of the Valley and maintain the reliability 02:03:44.100 --> 02:03:45.230 for those citizens down there. 02:03:45.230 --> 02:03:49.031 I know you've got an extensive background in this. 02:03:49.031 --> 02:03:50.203 I'm ready to go. 02:03:51.817 --> 02:03:56.817 I'm good to go, based on your work 02:03:57.080 --> 02:04:02.080 and your expertise on those two, as you just laid out. 02:04:02.250 --> 02:04:05.266 Okay, so do you want me to make a motion or do you want- 02:04:05.266 --> 02:04:07.680 Do you want to cover that or just those two? 02:04:07.680 --> 02:04:08.513 Do you want me to make a motion? 02:04:08.513 --> 02:04:10.810 If you have a motion ready, that'd be fantastic. 02:04:10.810 --> 02:04:12.460 Okay, is everybody comfortable with that? 02:04:12.460 --> 02:04:13.293 Yes. Okay, 02:04:13.293 --> 02:04:14.570 I just wanna make sure. 02:04:14.570 --> 02:04:19.570 Okay, so pursuant to PURA 35.005, subsection B and 39.23 E, 02:04:22.290 --> 02:04:26.670 I moved to order Stack, ETT/AUP and Cherryland 02:04:26.670 --> 02:04:28.270 to construct a new second circuit 02:04:28.270 --> 02:04:31.150 on the existing double-circuit capable 345 kb line 02:04:31.150 --> 02:04:34.200 that runs from the San Miguel station 02:04:34.200 --> 02:04:37.580 to the Palmito station and to close the loop 02:04:37.580 --> 02:04:41.473 from Palmito to North Edinburg 02:04:41.473 --> 02:04:45.913 to help ensure reliability in the Rio Grande Valley. 02:04:47.560 --> 02:04:48.393 We've got a motion. 02:04:48.393 --> 02:04:49.226 Is there a second? 02:04:50.860 --> 02:04:52.155 Second. 02:04:52.155 --> 02:04:53.755 All in favor, say aye. Aye. 02:04:55.043 --> 02:04:55.876 Okay, and before we move on, 02:04:55.876 --> 02:04:59.330 I will also say that if a CCN amendment is needed 02:04:59.330 --> 02:05:00.710 to build these facilities, 02:05:00.710 --> 02:05:01.730 and I don't think it will be needed 02:05:01.730 --> 02:05:03.990 for closing the loop, but if it's needed 02:05:03.990 --> 02:05:08.760 for the second circuit, that EDT and Cherryland said, 02:05:08.760 --> 02:05:11.370 it would take about eight months to prepare the CCN 02:05:11.370 --> 02:05:14.820 for submission to the PUC, 02:05:14.820 --> 02:05:17.980 if a CCN application is needed, a CNN amendment. 02:05:17.980 --> 02:05:21.913 So I would like to understand if that can be done faster. 02:05:24.580 --> 02:05:26.240 By the end of the year. 02:05:26.240 --> 02:05:28.940 Because if we are approving these projects 02:05:28.940 --> 02:05:31.160 under our statutory authority, 02:05:31.160 --> 02:05:34.960 we will be processing the CCN within 180 days, 02:05:36.510 --> 02:05:37.370 so that's about six months. 02:05:37.370 --> 02:05:40.610 So we would like to get this going as soon as possible. 02:05:40.610 --> 02:05:42.500 Yeah and to be clear, 02:05:42.500 --> 02:05:47.275 from our review of our existing CCN, we don't see, 02:05:47.275 --> 02:05:50.140 it's already certificated for double-circuit 02:05:50.140 --> 02:05:52.405 so we think we're good to go. 02:05:52.405 --> 02:05:54.280 So we don't see that as an issue. 02:05:54.280 --> 02:05:57.820 And our initial review indicates the same. 02:05:57.820 --> 02:06:00.870 If the Commission has other perspectives 02:06:01.897 --> 02:06:04.365 in Cherryland's part of the project, 02:06:04.365 --> 02:06:07.970 we specifically have said, we can do it in 30 months. 02:06:07.970 --> 02:06:10.090 If we have to go through the CCN process, 02:06:10.090 --> 02:06:13.952 obviously routing's not a issue for the second circuit, 02:06:13.952 --> 02:06:18.560 we're prepared as soon as we start that CCN process 02:06:18.560 --> 02:06:20.540 to go ahead and put dollars at work, 02:06:20.540 --> 02:06:22.500 from an engineering and procurement standpoint, 02:06:22.500 --> 02:06:24.480 recognizing the urgency of the project. 02:06:24.480 --> 02:06:27.270 And I feel comfortable that we'll hit 30 months. 02:06:27.270 --> 02:06:29.320 We don't have a contrary opinion on the CCN. 02:06:29.320 --> 02:06:30.153 Good to hear. 02:06:30.153 --> 02:06:31.397 Thank you. 02:06:31.397 --> 02:06:32.230 So you don't need, 02:06:32.230 --> 02:06:33.063 your position is you don't need a CCN 02:06:33.063 --> 02:06:34.280 for the closing the loop facilities? 02:06:34.280 --> 02:06:35.113 I'm sorry. 02:06:35.113 --> 02:06:37.050 For closing the loop, yes, we absolutely will 02:06:37.050 --> 02:06:37.890 because it's brand new. 02:06:37.890 --> 02:06:39.620 Right away for the second circuit. 02:06:39.620 --> 02:06:40.640 I'm sorry I was not clear. 02:06:40.640 --> 02:06:43.393 Okay, so will that take eight months to prepare? 02:06:44.886 --> 02:06:48.050 Our past histories has indicated yes, 02:06:48.050 --> 02:06:49.663 eight months is appropriate. 02:06:50.660 --> 02:06:54.640 I'll commit that we will leave no stone unturned 02:06:54.640 --> 02:06:57.370 to try and improve upon that eight-month period. 02:06:57.370 --> 02:07:00.631 Okay, so can you go back and visit 02:07:00.631 --> 02:07:05.631 with your counsel and see if you can get it done faster? 02:07:05.890 --> 02:07:08.003 And also- Why yes, I will. 02:07:08.003 --> 02:07:11.717 (everyone laughing) 02:07:11.717 --> 02:07:12.550 There we go. 02:07:12.550 --> 02:07:13.383 Yes, sir. 02:07:13.383 --> 02:07:14.216 My name is Corey Allen. 02:07:14.216 --> 02:07:18.050 I'm the power delivery manager for South Texas Electric Coop 02:07:18.050 --> 02:07:22.400 and, like Wayman said, we've got the rights 02:07:22.400 --> 02:07:25.050 to the double-circuit on that 42 miles 02:07:25.050 --> 02:07:28.290 that we have from San Miguel going towards the Lobo. 02:07:28.290 --> 02:07:31.190 And we do have the easement rights in place 02:07:31.190 --> 02:07:36.190 so don't think we'll have a regulatory time. 02:07:36.220 --> 02:07:37.510 Excellent. 02:07:37.510 --> 02:07:39.810 Cherryland, back to Cherryland. 02:07:39.810 --> 02:07:41.369 Good morning, Commissioners. 02:07:41.369 --> 02:07:42.350 John Zerwas with Cherryland. 02:07:42.350 --> 02:07:44.290 We can certainly go back and see if we can improve 02:07:44.290 --> 02:07:45.123 on the eight months. 02:07:45.123 --> 02:07:47.541 There's probably a few things we could expedite 02:07:47.541 --> 02:07:48.800 and try to cut it a little bit shorter. 02:07:48.800 --> 02:07:50.810 But we'll come back and stay in contact 02:07:50.810 --> 02:07:51.780 with you all about that. 02:07:51.780 --> 02:07:55.330 Okay and as I directed, and for the other project, 02:07:55.330 --> 02:07:56.880 if you can file your direct testimony 02:07:56.880 --> 02:07:59.444 with your CCN application to cut time, 02:07:59.444 --> 02:08:00.277 I think that would be very helpful. 02:08:00.277 --> 02:08:01.340 Absolutely. 02:08:01.340 --> 02:08:02.760 Excellent. 02:08:02.760 --> 02:08:03.593 All right. 02:08:05.490 --> 02:08:07.760 I think we can leave the Rio Grande Valley. 02:08:07.760 --> 02:08:08.593 All right. 02:08:11.518 --> 02:08:16.518 I'll just remind everyone that before the direction was 02:08:17.160 --> 02:08:19.550 given to move forward with closing the loop 02:08:19.550 --> 02:08:21.593 and the second circuit, 02:08:22.510 --> 02:08:24.180 there was also a very clear directive 02:08:24.180 --> 02:08:26.820 from this Commission to ERCOT to continue 02:08:26.820 --> 02:08:29.360 to accelerate the option to long-term 02:08:29.360 --> 02:08:30.980 transmission project under, 02:08:30.980 --> 02:08:33.823 would you like to codify that in motion or? 02:08:35.780 --> 02:08:36.613 Sure. 02:08:38.973 --> 02:08:40.046 I think she did, didn't she? 02:08:40.046 --> 02:08:42.380 I did. Oh, I'm sorry. 02:08:42.380 --> 02:08:44.281 We can, if you'd like. 02:08:44.281 --> 02:08:45.114 No, no. 02:08:45.114 --> 02:08:45.947 We're good, right? 02:08:45.947 --> 02:08:46.980 Well, before we leave this topic, 02:08:46.980 --> 02:08:50.010 actually, I do have a very important statement 02:08:50.010 --> 02:08:51.110 that I'd like to make. 02:08:52.010 --> 02:08:53.530 I think it's, as we've said, 02:08:53.530 --> 02:08:56.020 it's extremely important to maintain reliability 02:08:56.020 --> 02:08:57.174 in the Rio Grande Valley. 02:08:57.174 --> 02:08:59.590 But I do want to say I can't leave this topic 02:08:59.590 --> 02:09:02.370 with again reiterating that very importantly, 02:09:02.370 --> 02:09:03.833 that we need to be clear that we're not making a 02:09:03.833 --> 02:09:05.540 determination on cost. 02:09:05.540 --> 02:09:08.014 I know I asked for cost estimates 02:09:08.014 --> 02:09:10.630 in the filings that were made this past Monday. 02:09:10.630 --> 02:09:12.870 And although the Commission is ordering the construction 02:09:12.870 --> 02:09:14.730 of these transmission lines and facilities 02:09:14.730 --> 02:09:16.511 to improve the reliability in the Valley, 02:09:16.511 --> 02:09:19.410 we are in no way giving the companies a blank check 02:09:19.410 --> 02:09:21.630 to build the facilities being ordered today. 02:09:21.630 --> 02:09:25.470 All costs associated with the construction 02:09:25.470 --> 02:09:28.209 of these facilities, pursuant to the Commission's order, 02:09:28.209 --> 02:09:30.860 must still meet the rate making standard set forth 02:09:30.860 --> 02:09:32.170 in PURA and the Commission rules 02:09:32.170 --> 02:09:33.660 in a future rate making proceeding, 02:09:33.660 --> 02:09:36.340 which will require that rates are just and reasonable. 02:09:36.340 --> 02:09:38.550 It is my expectation, and I think our expectation, 02:09:38.550 --> 02:09:41.850 that staff will review all costs that the companies seek 02:09:41.850 --> 02:09:44.440 to recover for the order transmission 02:09:44.440 --> 02:09:46.930 with the same level of scrutiny that they would use 02:09:46.930 --> 02:09:48.910 in a rate case proceeding that does not involve 02:09:48.910 --> 02:09:52.330 the Commission order to construct to help ensure 02:09:52.330 --> 02:09:54.560 that the rate payers pay rates that comply 02:09:54.560 --> 02:09:58.053 with PURA and the Commission's rule standards. 02:09:59.029 --> 02:10:01.220 Well put. I second that. 02:10:01.220 --> 02:10:02.760 Thank you. 02:10:02.760 --> 02:10:05.270 So Commissioner Cobos, just to follow 02:10:05.270 --> 02:10:06.540 with the less important, 02:10:06.540 --> 02:10:10.680 we're gonna open a project as a storage house, 02:10:10.680 --> 02:10:13.380 a place to file Commission orders that direct 02:10:13.380 --> 02:10:15.750 to building of the transmission so that these orders 02:10:15.750 --> 02:10:17.353 will be easy to find. 02:10:18.630 --> 02:10:21.110 And can you move my memos and the TSP's filings 02:10:21.110 --> 02:10:23.640 that have been filed to date from 51617 02:10:23.640 --> 02:10:24.882 into that new project? 02:10:24.882 --> 02:10:29.053 I'll file those in that when we open it up. 02:10:30.260 --> 02:10:31.093 Thank you. 02:10:31.093 --> 02:10:32.112 I think that's a great idea. 02:10:32.112 --> 02:10:32.945 Excellent. That's a good idea. 02:10:32.945 --> 02:10:34.011 Okay. 02:10:34.011 --> 02:10:35.483 Good deal. 02:10:35.483 --> 02:10:36.692 Thank you all. 02:10:36.692 --> 02:10:38.530 Thank you. Thank you. 02:10:40.620 --> 02:10:42.016 That wraps up business on- 02:10:42.016 --> 02:10:43.420 Can I? 02:10:43.420 --> 02:10:46.286 I just have one statement that I wanna make. 02:10:46.286 --> 02:10:48.370 It's not pertaining to the Rio Grande Valley, 02:10:48.370 --> 02:10:49.643 but I've had some discussions 02:10:49.643 --> 02:10:54.643 with Brad Jones at ERCOT about potential, 02:10:58.680 --> 02:11:02.110 if we run into a major reliability outage, 02:11:02.110 --> 02:11:07.110 like we did during winter storm Uri, 02:11:07.400 --> 02:11:10.030 and if our system went down, 02:11:10.030 --> 02:11:11.990 obviously we have black star plans 02:11:11.990 --> 02:11:14.580 and we have black star plants around ERCOT 02:11:14.580 --> 02:11:18.530 that would help us bring the system back up. 02:11:18.530 --> 02:11:21.429 That's still not an easy process to manage, 02:11:21.429 --> 02:11:26.400 bringing up generation and load in a way that is 02:11:27.740 --> 02:11:30.098 well, there's a process for that. 02:11:30.098 --> 02:11:34.950 And thank God we have operators that test this 02:11:34.950 --> 02:11:37.251 and work towards it. 02:11:37.251 --> 02:11:38.980 There have been a couple of discussions 02:11:38.980 --> 02:11:43.359 about what might happen if we could build 02:11:43.359 --> 02:11:47.220 an AC interconnection to SPP 02:11:48.530 --> 02:11:52.490 or to the Midwest ISO South, Entergy South, 02:11:52.490 --> 02:11:55.233 and keep that circuit open all the time. 02:11:56.138 --> 02:11:59.400 And I'm not talking about FERC jurisdiction here, 02:11:59.400 --> 02:12:01.060 but this would never happen if there 02:12:01.060 --> 02:12:02.250 was a jurisdictional issue. 02:12:02.250 --> 02:12:06.170 But keep it open unless there was the absolute emergency 02:12:06.170 --> 02:12:10.010 that leaning on another system would help us bring up the 02:12:10.010 --> 02:12:13.293 ERCOT system in the event of a major catastrophe. 02:12:14.219 --> 02:12:17.480 We've got a handful of facilities that might be utilized 02:12:17.480 --> 02:12:19.840 for that and I know ERCOT has been working 02:12:20.690 --> 02:12:23.080 with a university here in Texas on a study 02:12:23.080 --> 02:12:24.610 that should be done in 2022. 02:12:25.760 --> 02:12:29.560 But to me it seems like it's a really good issue 02:12:29.560 --> 02:12:32.190 to consider for the economy of our state. 02:12:32.190 --> 02:12:34.538 We don't want an outage for 30 days. 02:12:34.538 --> 02:12:35.430 We don't want an outage for a week, 02:12:35.430 --> 02:12:36.940 if we can lean on something else. 02:12:36.940 --> 02:12:39.310 We've done things similar where we've block loaded, 02:12:39.310 --> 02:12:43.050 as it's called, loads into SVP and loads into MISO. 02:12:43.050 --> 02:12:44.400 This would be a little different, 02:12:44.400 --> 02:12:49.400 but it could provide us some valuable black start frequency 02:12:51.130 --> 02:12:52.920 support if we needed it. 02:12:52.920 --> 02:12:54.626 And we don't have the answer yet, 02:12:54.626 --> 02:12:59.626 but to me, it's a good educational tool. 02:13:00.440 --> 02:13:04.500 It's a good research project to see if this is something 02:13:04.500 --> 02:13:06.290 that would benefit all Texans 02:13:06.290 --> 02:13:10.280 in the event of a major catastrophic outage. 02:13:10.280 --> 02:13:11.390 That's a great idea. 02:13:11.390 --> 02:13:14.550 And I know you've taken a special interest 02:13:14.550 --> 02:13:16.680 and initiated some special projects 02:13:16.680 --> 02:13:18.470 related to vegetation management, 02:13:18.470 --> 02:13:20.480 a more granular load shed. 02:13:20.480 --> 02:13:23.690 Would this be something you'd be willing to take on 02:13:23.690 --> 02:13:25.873 and lead the charge on? 02:13:25.873 --> 02:13:26.706 I thought I already did. 02:13:26.706 --> 02:13:28.740 I did too. 02:13:28.740 --> 02:13:30.107 I did too, just what's the next step? 02:13:30.107 --> 02:13:31.013 Thank you, thank you, sir. 02:13:31.013 --> 02:13:34.210 I think, I don't know what the next step is. 02:13:34.210 --> 02:13:37.390 I think we need data from the study. 02:13:37.390 --> 02:13:42.180 Obviously, we'll have conversations with FERC 02:13:42.180 --> 02:13:43.740 and the pink building. 02:13:43.740 --> 02:13:47.200 We don't want, this is not anything to do 02:13:47.200 --> 02:13:48.660 If there's a jurisdictional problem- 02:13:48.660 --> 02:13:51.810 With partial application, in other words. 02:13:51.810 --> 02:13:55.991 This would be totally emergency application period. 02:13:55.991 --> 02:13:59.400 As with the other issues that you're taking the lead on, 02:13:59.400 --> 02:14:04.400 please identify ways to accelerate, streamline processes 02:14:04.610 --> 02:14:09.610 and move as quickly as we can to an actionable solution. 02:14:10.050 --> 02:14:11.340 Okay, thank you. 02:14:12.330 --> 02:14:15.695 Woody, back to you for the remainder of your presentation. 02:14:15.695 --> 02:14:17.090 All right. 02:14:17.090 --> 02:14:18.060 You guys ready to move on 02:14:18.060 --> 02:14:21.290 to load forecast boundary threshold? 02:14:21.290 --> 02:14:22.123 Yes, sir. Yes sir, quickly. 02:14:22.123 --> 02:14:23.620 Okay, quickly. 02:14:23.620 --> 02:14:27.230 So when ERCOT prepares future planning fixes, 02:14:27.230 --> 02:14:29.360 we put a load forecasting and it's kind 02:14:29.360 --> 02:14:30.540 of a top-down forecast. 02:14:30.540 --> 02:14:32.937 We use economics and Moody's forecast. 02:14:32.937 --> 02:14:35.030 And we say, this is how much load is gonna be 02:14:35.030 --> 02:14:36.615 in certain areas. 02:14:36.615 --> 02:14:39.680 That's our forecast. 02:14:39.680 --> 02:14:43.110 And this forecast goes into 2022 cases, 02:14:43.110 --> 02:14:45.350 '23, '24, '25, '26, 02:14:45.350 --> 02:14:49.140 those future planning cases have our forecasts in 'em. 02:14:49.140 --> 02:14:53.770 Now TSPs, working more from the field up, 02:14:53.770 --> 02:14:56.140 taking customer information, 02:14:56.140 --> 02:14:59.403 bring their forecast in and compare it to ours. 02:15:00.580 --> 02:15:02.880 If their forecast currently, 02:15:02.880 --> 02:15:07.010 if their forecast is greater than ours 02:15:07.010 --> 02:15:12.010 but less than 5% more, then we accept their forecast 02:15:12.110 --> 02:15:14.340 and put that into the planning case. 02:15:14.340 --> 02:15:18.283 If their forecast is, let's say 8% more than ours, 02:15:19.213 --> 02:15:22.280 then we cap it at 5%. 02:15:22.280 --> 02:15:24.360 And that's true for all the weather zones, 02:15:24.360 --> 02:15:26.200 except for the Far West, 02:15:26.200 --> 02:15:28.050 which has a seven and a half percent. 02:15:29.090 --> 02:15:33.360 So what we're talking about today is 02:15:33.360 --> 02:15:38.360 a move to increasing that boundary threshold. 02:15:38.448 --> 02:15:41.046 Instead of having 5% for the weather zone, 02:15:41.046 --> 02:15:44.437 moving it up to seven and a half percent 02:15:44.437 --> 02:15:46.520 in all the weather zones. 02:15:48.890 --> 02:15:51.210 I think that's a reasonable initial step 02:15:51.210 --> 02:15:56.210 to better account for the changing needs and load growth. 02:15:56.460 --> 02:15:59.180 And it may actually help alleviate some 02:15:59.180 --> 02:16:01.580 of the just-in-time planning that we have to do, 02:16:03.340 --> 02:16:05.420 having that power load in there. 02:16:05.420 --> 02:16:10.420 So the request here is that you give us instructions 02:16:10.470 --> 02:16:12.500 that you want that boundary threshold moved 02:16:12.500 --> 02:16:14.250 from 5% to seven and a half percent 02:16:14.250 --> 02:16:15.719 in all the weather zones. 02:16:15.719 --> 02:16:19.220 And then the process is we can go back to TAC. 02:16:19.220 --> 02:16:22.010 We ask for a TAC recommendation. 02:16:22.010 --> 02:16:23.977 We take the TAC recommendation to the board 02:16:23.977 --> 02:16:28.373 and the board approves it and then it's done at that point. 02:16:29.429 --> 02:16:31.079 That makes sense to me. 02:16:31.913 --> 02:16:34.310 And then does it have to come back to us? 02:16:34.310 --> 02:16:35.790 No, we can implement it. 02:16:35.790 --> 02:16:37.410 Okay, good. 02:16:37.410 --> 02:16:38.870 Thank you, Woody, for your recommendation. 02:16:38.870 --> 02:16:40.490 I think it's important to recognize 02:16:40.490 --> 02:16:42.720 that our state is growing and it's been growing. 02:16:42.720 --> 02:16:44.430 We have a tremendous amount of population 02:16:44.430 --> 02:16:46.490 and economic growth throughout the state. 02:16:46.490 --> 02:16:51.260 I know that the rest of the state is in 5%. 02:16:51.260 --> 02:16:53.610 Liz Jones, do you have anything you'd like to add? 02:16:53.610 --> 02:16:55.080 If I may. Please. 02:17:01.090 --> 02:17:02.713 Liz Jones for Encore. 02:17:05.340 --> 02:17:07.710 I'd like to make sure one thing's clear, 02:17:07.710 --> 02:17:12.010 which is that the percentage increment is 02:17:12.010 --> 02:17:13.590 on a weather zone basis. 02:17:13.590 --> 02:17:15.503 And so depending on the weather zone, 02:17:16.522 --> 02:17:18.700 that's a few megawatts or that's a lot of megawatts. 02:17:18.700 --> 02:17:21.250 So if you talk about the North Central weather zone, 02:17:21.250 --> 02:17:23.540 which includes the DFW area, 02:17:23.540 --> 02:17:26.720 seven and a half percent is a significant amount. 02:17:26.720 --> 02:17:28.908 If you talk about the Far West weather zone, 02:17:28.908 --> 02:17:31.340 it is a much smaller amount. 02:17:31.340 --> 02:17:36.340 And wasn't familiar with our cuts intentions 02:17:37.370 --> 02:17:39.833 until you all provided your slides. 02:17:41.600 --> 02:17:43.350 Would like for you all to think about 02:17:43.350 --> 02:17:46.070 whether there needs to be some relationship 02:17:46.070 --> 02:17:51.070 to the base size of the forecast 02:17:52.050 --> 02:17:55.460 when you're thinking about what the percentage increment 02:17:55.460 --> 02:17:57.610 of adjustments should be. 02:17:57.610 --> 02:18:00.480 And that is how the Far West moved 02:18:00.480 --> 02:18:02.390 from five to seven and a half. 02:18:02.390 --> 02:18:04.270 I'm not suggesting that there's a basis 02:18:04.270 --> 02:18:06.370 to move from seven and a half to 10, 02:18:06.370 --> 02:18:10.400 but I do want to make you aware that the, 02:18:10.400 --> 02:18:13.260 particularly in fast growing areas like the Valley, 02:18:13.260 --> 02:18:18.260 like the Permian, that can be less useful 02:18:18.800 --> 02:18:20.760 just because of the base number. 02:18:20.760 --> 02:18:24.250 And so I think, as Woody explained, 02:18:24.250 --> 02:18:26.650 this is something that is managed through the ERCOT board 02:18:26.650 --> 02:18:29.820 and so it doesn't necessarily have to come back through you. 02:18:29.820 --> 02:18:34.350 But it would be helpful if you offered guidance 02:18:34.350 --> 02:18:36.740 on treating this issue. 02:18:36.740 --> 02:18:40.070 Do you have a suggestion on what a revised number 02:18:40.070 --> 02:18:43.360 for a fast-growing area like DFW should look like? 02:18:43.360 --> 02:18:47.070 Well, my suggestion is that because the base number 02:18:47.070 --> 02:18:51.940 in North Central is so large and we're now talking 02:18:51.940 --> 02:18:54.470 about the seven and a half percent ban, 02:18:54.470 --> 02:18:58.550 I think we, at Encore, are much more comfortable 02:18:58.550 --> 02:19:01.040 with what those numbers look like for North Central 02:19:01.040 --> 02:19:04.620 than we are for what those numbers look like in the Permian. 02:19:04.620 --> 02:19:08.870 And so if you could afford ERCOT 02:19:10.220 --> 02:19:13.660 and Woody the discretion to bump that number up 02:19:13.660 --> 02:19:18.530 for the smaller weather zones, if they deem appropriate, 02:19:18.530 --> 02:19:21.393 I think it would be beneficial for us. 02:19:23.671 --> 02:19:25.997 Fair enough. Woody, is there 02:19:25.997 --> 02:19:29.280 any information that you can maybe bring back to us 02:19:29.280 --> 02:19:31.320 that would help paint a little bit more 02:19:31.320 --> 02:19:34.050 of a picture for us on exactly what- 02:19:34.050 --> 02:19:36.460 Yeah, maybe an impact of- 02:19:36.460 --> 02:19:38.600 Low thresholds, you know. 02:19:38.600 --> 02:19:39.433 We can look at, 02:19:39.433 --> 02:19:41.210 I mean, this has been going on for years 02:19:41.210 --> 02:19:44.510 and so you can go back and look at what actually happened 02:19:44.510 --> 02:19:47.760 in 2020 versus what the ERCOT load forecast 02:19:47.760 --> 02:19:49.390 said was gonna happen in 2020. 02:19:49.390 --> 02:19:50.223 That's a good point. 02:19:50.223 --> 02:19:51.760 You can do that for 2019 02:19:51.760 --> 02:19:53.350 'cause 2020 was kind of a strange year 02:19:53.350 --> 02:19:55.933 because of COVID. 02:19:57.790 --> 02:20:00.263 So there is information like that. 02:20:02.199 --> 02:20:04.130 This is a stretch though right now. 02:20:04.130 --> 02:20:06.340 And seven and a half percent, 02:20:06.340 --> 02:20:09.723 we thought long and hard about the seven and a half percent. 02:20:09.723 --> 02:20:14.260 That was a stretch, that's a big change. 02:20:14.260 --> 02:20:15.880 Well it seems like the impact 02:20:15.880 --> 02:20:20.060 of whatever that 5% to x is 02:20:20.060 --> 02:20:22.975 can greatly vary, depending on the load serve 02:20:22.975 --> 02:20:24.140 to that particular area. 02:20:24.140 --> 02:20:27.950 Would it be productive as an intermediate step 02:20:27.950 --> 02:20:32.950 to look at a data table of expected impact 02:20:33.940 --> 02:20:37.373 in each of the seven weather zones for- 02:20:38.590 --> 02:20:41.062 I can tell you that this year, 02:20:41.062 --> 02:20:46.062 this year six of the eight weather zones, 02:20:46.980 --> 02:20:51.270 the TSP predictions forecast were above 02:20:51.270 --> 02:20:54.253 what we had in our economic forecast. 02:20:55.460 --> 02:20:57.610 Six out of the eight weather zones. 02:20:57.610 --> 02:20:59.617 More than 5%? 02:20:59.617 --> 02:21:02.190 More than 5%, correct. 02:21:02.190 --> 02:21:03.883 And I can also tell you that, 02:21:07.593 --> 02:21:08.913 let me get my number here. 02:21:10.463 --> 02:21:12.903 We did think about this a little bit beforehand. 02:21:16.310 --> 02:21:19.350 That, for example, I'm not gonna use 2020 02:21:19.350 --> 02:21:23.700 but in 2019, if you think about 2019, 02:21:23.700 --> 02:21:27.190 we made a forecast in 2016 of what 2019 02:21:27.190 --> 02:21:28.190 was gonna look like. 02:21:29.360 --> 02:21:31.310 And the actual numbers that came in 02:21:32.240 --> 02:21:35.380 were below our forecast in 2019 02:21:35.380 --> 02:21:38.690 in every weather zone, except for the Far West, 02:21:38.690 --> 02:21:42.020 which is partly what led to us increasing that 02:21:42.020 --> 02:21:43.760 to seven and a half percent. 02:21:43.760 --> 02:21:47.840 So this year, six out of eight forecasts 02:21:47.840 --> 02:21:49.540 are above our forecasts. 02:21:49.540 --> 02:21:52.170 In the past, the actuals, when they've come in, 02:21:52.170 --> 02:21:55.970 have been below the 5% boundary that we have. 02:21:55.970 --> 02:21:59.483 So what does the future hold? 02:22:01.290 --> 02:22:04.593 Strong economic growth still, it appears. 02:22:05.514 --> 02:22:08.220 The bottom line is forecasting is hard. 02:22:08.220 --> 02:22:09.380 No matter what you say, 02:22:09.380 --> 02:22:12.427 you will surely be wrong, it's just a question of how. 02:22:12.427 --> 02:22:15.390 And so again, I'm not up here asking 02:22:15.390 --> 02:22:17.210 for a blank check, by any means. 02:22:17.210 --> 02:22:19.210 But what I am asking you all to think 02:22:19.210 --> 02:22:23.010 about is seven and a half is a guidepost 02:22:23.010 --> 02:22:26.660 and not a cap because circumstances 02:22:26.660 --> 02:22:30.370 in different weather zones may necessitate 02:22:30.370 --> 02:22:32.140 a different result. 02:22:32.140 --> 02:22:33.676 Fair enough. 02:22:33.676 --> 02:22:34.509 I appreciate the point. 02:22:34.509 --> 02:22:36.290 Maybe you could coordinate with ERCOT 02:22:36.290 --> 02:22:39.070 on evaluating what a scenario would look like 02:22:39.070 --> 02:22:42.150 between with different metrics for different weather zones. 02:22:42.150 --> 02:22:43.377 Would that make sense? 02:22:43.377 --> 02:22:45.490 Well, I think so, 02:22:45.490 --> 02:22:48.900 but it sounds like what you're asking 02:22:48.900 --> 02:22:51.100 for is sort of a policy change 02:22:51.100 --> 02:22:52.600 of how we apply the threshold. 02:22:54.090 --> 02:22:56.860 Well, so let me, I'm sorry, 02:22:56.860 --> 02:22:58.260 brief history lesson. 02:22:58.260 --> 02:23:02.330 Part of the reason that the 5% came into effect 02:23:02.330 --> 02:23:04.970 in the planning guide was as a consequence 02:23:04.970 --> 02:23:09.930 of concern that transmission and distribution providers 02:23:09.930 --> 02:23:12.653 were padding their forecasts to maximize their bill. 02:23:14.271 --> 02:23:19.023 And Encore supported this change and we're standing by it. 02:23:20.132 --> 02:23:24.290 What we're suggesting is that in the past 02:23:24.290 --> 02:23:26.830 that has been applied as such a hard cap, 02:23:26.830 --> 02:23:29.420 from a forecasting perspective, 02:23:29.420 --> 02:23:33.340 that it has been difficult to bring forward projects, 02:23:33.340 --> 02:23:35.500 particularly in fast growing areas, 02:23:35.500 --> 02:23:37.450 that we think are merited, 02:23:37.450 --> 02:23:41.330 not because it's within the 5% dead band, 02:23:41.330 --> 02:23:42.163 if you will, 02:23:42.163 --> 02:23:45.650 but because there are particular circumstances in the area, 02:23:45.650 --> 02:23:50.400 and I believe Senate Bill 1281 actually codifies 02:23:50.400 --> 02:23:55.380 that kind of point of view so that there is 02:23:55.380 --> 02:23:58.320 some more flexibility there than what has historically 02:23:58.320 --> 02:24:03.320 been provided by the 5% or the seven and a half percent cap. 02:24:03.580 --> 02:24:08.390 Okay, so as a utility on the ground, 02:24:08.390 --> 02:24:09.520 in your service territory, 02:24:09.520 --> 02:24:11.760 you're able to see the growth better 02:24:11.760 --> 02:24:14.650 or in some ways are able to have, 02:24:14.650 --> 02:24:16.160 you're providing information to ERCOT 02:24:16.160 --> 02:24:17.860 because you're on the ground. 02:24:17.860 --> 02:24:19.630 You're much closer to the actual load growth. 02:24:19.630 --> 02:24:22.710 They have their forecasting methodologies. 02:24:22.710 --> 02:24:25.430 And so it sounds like to me, 02:24:25.430 --> 02:24:27.590 and again, please clarify if I'm not exactly 02:24:27.590 --> 02:24:29.690 capturing what you're saying is that, 02:24:29.690 --> 02:24:31.890 even if we went to seven and a half percent, 02:24:32.928 --> 02:24:34.330 and we asked ERCOT to go and change it 02:24:34.330 --> 02:24:35.163 for all the weather zones. 02:24:35.163 --> 02:24:37.510 Because it sounds like, from what you're saying, Woody, 02:24:37.510 --> 02:24:42.510 that the 5% in six weather zones is constraining. 02:24:44.070 --> 02:24:47.230 It's actually constraining how much load growth 02:24:47.230 --> 02:24:49.770 is probably happening 'cause we have rebounded 02:24:49.770 --> 02:24:52.050 from COVID and our economy has been strong, 02:24:52.050 --> 02:24:53.330 it's gonna stay strong. 02:24:53.330 --> 02:24:57.860 And so if we go to seven and a half percent, 02:24:57.860 --> 02:25:00.840 to not have that be a hard cap 02:25:00.840 --> 02:25:05.840 but to be a guide and maybe if you see something higher 02:25:05.890 --> 02:25:08.004 than what ERCOT is seeing, 02:25:08.004 --> 02:25:10.330 you can provide supporting documentation 02:25:10.330 --> 02:25:12.610 and work with ERCOT to prove your case? 02:25:12.610 --> 02:25:16.440 Yes, and again, historically that has been 02:25:16.440 --> 02:25:18.340 in the nature of signed agreements 02:25:19.306 --> 02:25:22.930 that are securitized by the new customers. 02:25:22.930 --> 02:25:25.340 That's a just-in-time standard 02:25:25.340 --> 02:25:30.340 because customers don't wanna make commitments 02:25:30.800 --> 02:25:33.210 and disclose their business plans 02:25:33.210 --> 02:25:34.880 earlier than they have to. 02:25:34.880 --> 02:25:39.300 So we're looking for the ability to use a range 02:25:39.300 --> 02:25:41.890 of evidence and we bear the burden of proof, 02:25:41.890 --> 02:25:46.060 absolutely, as utilities, that additional infrastructure 02:25:46.060 --> 02:25:47.400 is needed. 02:25:47.400 --> 02:25:50.600 Okay, so as an interim step, 02:25:50.600 --> 02:25:55.600 something to consider is perhaps having Woody 02:25:55.727 --> 02:25:59.010 and ERCOT go ahead and increase to seven and a half, 02:25:59.010 --> 02:26:00.540 as an interim step. 02:26:00.540 --> 02:26:03.840 And then for this proposal that you've provided us today, 02:26:03.840 --> 02:26:07.080 to continue exploring how we can get that 02:26:07.080 --> 02:26:09.757 into the planning guides so that we have more transparency 02:26:09.757 --> 02:26:11.480 in the process going forward. 02:26:11.480 --> 02:26:14.123 Does that makes sense? Yes. 02:26:17.020 --> 02:26:19.920 So this would not be a permanent order 02:26:19.920 --> 02:26:23.770 in terms of system change for ERCOT. 02:26:23.770 --> 02:26:28.770 This would just be almost a pilot moving forward 02:26:29.091 --> 02:26:31.880 for their evaluation guidelines? 02:26:31.880 --> 02:26:34.330 I think that if we were comfortable today, 02:26:34.330 --> 02:26:36.090 if we were comfortable and if you're not, 02:26:36.090 --> 02:26:38.267 then you can think about it. 02:26:38.267 --> 02:26:40.520 But if you were comfortable today, 02:26:40.520 --> 02:26:43.790 as an interim step, as ERCOT recommended, 02:26:43.790 --> 02:26:47.950 we can ask them to raise the 5% boundary threshold 02:26:47.950 --> 02:26:49.910 to seven and a half because it sounds like, 02:26:49.910 --> 02:26:52.550 at least for six weather zones in the last year, 02:26:52.550 --> 02:26:54.850 the low forecasts are seen from the TSPs 02:26:54.850 --> 02:26:57.110 are being constrained by the 5%. 02:26:57.110 --> 02:26:58.190 In other words, they're higher 02:26:58.190 --> 02:26:59.023 and they're being constrained. 02:26:59.023 --> 02:27:00.130 So as an interim step, 02:27:00.130 --> 02:27:03.367 we increase it from 5% to seven and a half percent 02:27:03.367 --> 02:27:08.150 to take into account that growth that- 02:27:08.150 --> 02:27:09.200 So we know we're growing, 02:27:09.200 --> 02:27:11.140 so let's paint with a broad brush first 02:27:11.140 --> 02:27:14.940 and then in the meantime we can put a finer point 02:27:14.940 --> 02:27:17.340 on particular areas. 02:27:17.340 --> 02:27:20.250 Have ERCOT explore this concept. 02:27:20.250 --> 02:27:25.250 Work with Encore and the TDUs to explore that concept 02:27:25.350 --> 02:27:28.080 of having the boundary threshold serve 02:27:28.080 --> 02:27:32.665 as a guiding post and what additional information 02:27:32.665 --> 02:27:35.920 a utility or TSP can provide 02:27:35.920 --> 02:27:38.562 when they exceed the seven and a half percent 02:27:38.562 --> 02:27:43.562 that's something beyond just a signed agreement, 02:27:43.700 --> 02:27:45.820 that would still provide the proof that you need, 02:27:45.820 --> 02:27:48.650 as ERCOT, and we want to see too 02:27:48.650 --> 02:27:50.710 because we don't want to have projects justified 02:27:50.710 --> 02:27:51.800 if the growth isn't there. 02:27:51.800 --> 02:27:53.120 Absolutely. Right. 02:27:53.120 --> 02:27:57.350 But proof that would help solidify 02:27:59.830 --> 02:28:01.940 the utility's case for why it exceeded 02:28:01.940 --> 02:28:03.190 seven and a half percent. 02:28:04.110 --> 02:28:06.120 In addition, not just a signed contract 02:28:06.120 --> 02:28:09.010 but other forms of proof. 02:28:09.010 --> 02:28:11.960 Yes, Commissioner, we believe that would be very helpful. 02:28:12.940 --> 02:28:16.370 So I think the five to seven and a half percent 02:28:16.370 --> 02:28:18.767 is direction from you, we take it to TAC, 02:28:18.767 --> 02:28:20.173 and we get board approval, 02:28:21.392 --> 02:28:24.060 and that becomes part of our process at that point. 02:28:24.060 --> 02:28:26.450 So that could happen fully over the year. 02:28:26.450 --> 02:28:29.753 October. Potentially. 02:28:31.525 --> 02:28:33.310 Let's hold up for today. 02:28:33.310 --> 02:28:35.690 Let's propose to make the move from 5% 02:28:36.880 --> 02:28:39.050 to seven and a half percent 02:28:39.050 --> 02:28:42.030 and we'll direct that to be implemented. 02:28:42.030 --> 02:28:44.283 And then as the next step we can- 02:28:46.260 --> 02:28:48.783 The next step is a planning guide revision, 02:28:48.783 --> 02:28:50.888 at the very least. Yup. 02:28:50.888 --> 02:28:52.690 And there's gonna be a lot of that going on, 02:28:52.690 --> 02:28:54.693 so we don't need to solve it all today. 02:28:56.100 --> 02:28:57.338 Can I just ask one question 02:28:57.338 --> 02:29:02.338 about the practical effect of this is kind of 02:29:06.050 --> 02:29:09.740 over projecting, potentially over projecting 02:29:09.740 --> 02:29:13.070 the load growth in a region, correct? 02:29:13.070 --> 02:29:15.280 So that could mean more transmission 02:29:15.280 --> 02:29:16.830 as opposed to less transmission. 02:29:16.830 --> 02:29:19.070 Yeah. Could be. 02:29:19.070 --> 02:29:19.903 Could be. 02:29:19.903 --> 02:29:21.090 It could also mean the second circuit 02:29:21.090 --> 02:29:25.418 of some lines get approved. Oh, wow. 02:29:25.418 --> 02:29:26.251 Man, what a great thought. 02:29:26.251 --> 02:29:27.084 I'm trying to figure out 02:29:27.084 --> 02:29:28.509 if the checkbook is open right now 02:29:28.509 --> 02:29:30.410 because I'll just write a check. 02:29:30.410 --> 02:29:32.250 But the question really that I have 02:29:32.250 --> 02:29:37.250 is do, you need this, 02:29:38.020 --> 02:29:39.640 you need this change when? 02:29:39.640 --> 02:29:43.130 When are you using the five versus seven and a half percent? 02:29:43.130 --> 02:29:44.343 Is it for, 02:29:48.740 --> 02:29:53.740 do you need it by December for a next transmission plan? 02:29:53.860 --> 02:29:55.620 Do you need it by March? 02:29:55.620 --> 02:29:57.130 That's what I'm trying to figure out. 02:29:57.130 --> 02:29:59.750 Those load forecasts will go into planning cases. 02:29:59.750 --> 02:30:01.933 We have a set of planning cases every year 02:30:01.933 --> 02:30:04.200 that we use for evaluation. 02:30:04.200 --> 02:30:07.410 Those planning cases either have a ERCOT forecast, 02:30:07.410 --> 02:30:09.040 they have a 5% bounded forecast 02:30:09.040 --> 02:30:10.630 or they might have a seven and a half percent 02:30:10.630 --> 02:30:12.300 bounded forecast in those weather zones. 02:30:12.300 --> 02:30:14.784 And the more loads you have in the planning cases, 02:30:14.784 --> 02:30:18.710 the more needs will show up in the transmission perspective. 02:30:18.710 --> 02:30:21.620 And those base cases are for reliability projects? 02:30:21.620 --> 02:30:23.720 Those are for reliability projects, yes. 02:30:24.760 --> 02:30:26.583 And, sorry. 02:30:28.110 --> 02:30:30.360 And those forecasts are also used 02:30:30.360 --> 02:30:34.420 when ERCOT evaluates large transmission projects 02:30:34.420 --> 02:30:37.220 or transmission projects that are not radial 02:30:37.220 --> 02:30:39.080 that require a CCN. 02:30:39.080 --> 02:30:40.640 So I would suggest to you 02:30:40.640 --> 02:30:43.240 that they are your first screen for whether 02:30:43.240 --> 02:30:44.810 a project is needed. 02:30:44.810 --> 02:30:49.110 But you all and your staff provide the second screen. 02:30:49.110 --> 02:30:51.000 So this is not a blank check. 02:30:51.000 --> 02:30:55.180 I think the big picture is it was abundantly clear 02:30:55.180 --> 02:30:57.670 earlier today that the planning process 02:30:57.670 --> 02:31:00.810 for transmission needs to be improved. 02:31:00.810 --> 02:31:04.700 In the meantime, this change would help us 02:31:04.700 --> 02:31:08.700 defer towards the side of load growth 02:31:08.700 --> 02:31:10.753 rather than constrains. 02:31:10.753 --> 02:31:15.000 I understand that but I'm still confused on one thing. 02:31:15.000 --> 02:31:17.180 You all, you have your load, 02:31:17.180 --> 02:31:21.950 you all have your transmission planning models 02:31:21.950 --> 02:31:23.030 that you all use. 02:31:23.030 --> 02:31:26.530 And I'm assuming that utilities and ERCOT 02:31:26.530 --> 02:31:28.880 have the same model and this is... 02:31:29.797 --> 02:31:31.670 Do I have something wrong? 02:31:31.670 --> 02:31:33.750 I guess what I'm trying to figure out is 02:31:35.600 --> 02:31:38.220 changing this from five to seven and a half percent 02:31:38.220 --> 02:31:43.220 in September 23rd versus January 1, 2022, 02:31:44.010 --> 02:31:46.333 what's the practical impact of that? 02:31:47.540 --> 02:31:52.540 Is it that every study of every project 02:31:52.934 --> 02:31:57.934 that gets studied between now and the end of the year 02:31:58.650 --> 02:32:00.193 uses a lower threshold? 02:32:01.690 --> 02:32:04.601 Or, I'm just trying to understand 02:32:04.601 --> 02:32:09.250 when a utility proposes a reliability project 02:32:09.250 --> 02:32:13.630 or ERCOT says, we believe that this project needs to happen, 02:32:13.630 --> 02:32:15.382 what's the timeframe for that? 02:32:15.382 --> 02:32:18.230 Those planning cases are built once a year. 02:32:18.230 --> 02:32:19.063 Once a year, okay. 02:32:19.063 --> 02:32:21.160 And the load, in those planning cases, 02:32:21.160 --> 02:32:23.430 is distributed according to that load forecast. 02:32:23.430 --> 02:32:25.883 It's agreed upon. Okay. 02:32:28.209 --> 02:32:30.485 And when are the planning cases? 02:32:30.485 --> 02:32:32.160 They're built at the first of the year so- 02:32:32.160 --> 02:32:33.027 That's what I wanted to know, 02:32:33.027 --> 02:32:34.860 that's what I wanted to know. 02:32:34.860 --> 02:32:39.080 And they're updated three times yearly. 02:32:39.080 --> 02:32:40.120 Okay. 02:32:40.120 --> 02:32:45.120 And we have the luxury of a smaller surface area 02:32:45.570 --> 02:32:50.570 than ERCOT and so we are continuously updating 02:32:50.830 --> 02:32:53.000 our transmission plan and thinking 02:32:53.000 --> 02:32:55.530 about what forecasting should go into it 02:32:55.530 --> 02:32:58.050 for particular regions and particular projects. 02:32:58.050 --> 02:33:01.960 ERCOT has the challenge of mapping 02:33:01.960 --> 02:33:03.630 and accounting for the entire grid 02:33:03.630 --> 02:33:07.556 and therefore their updates are less frequent than ours. 02:33:07.556 --> 02:33:08.389 Okay. 02:33:11.710 --> 02:33:13.720 That answered my question. 02:33:13.720 --> 02:33:14.560 Where does that leave you 02:33:14.560 --> 02:33:16.710 in terms of is this something that's productive 02:33:16.710 --> 02:33:17.653 to do now? 02:33:19.060 --> 02:33:21.020 I'm fine upgrading it now 02:33:21.020 --> 02:33:23.870 and then having another look later or, 02:33:23.870 --> 02:33:25.630 not making this a blank check, 02:33:25.630 --> 02:33:29.240 but I think we have load growth in the state 02:33:29.240 --> 02:33:30.714 and I think it's pretty common 02:33:30.714 --> 02:33:34.760 that it's growing, pretty common knowledge. 02:33:34.760 --> 02:33:37.705 But I just don't want it to be a blank check. 02:33:37.705 --> 02:33:39.510 Yeah, agreed. And more this was juts 02:33:39.510 --> 02:33:43.010 a trying to understand when the planning model. 02:33:43.010 --> 02:33:47.214 Yeah, and it's moving it from five, 02:33:47.214 --> 02:33:49.480 it's still a cap at seven and a half percent. 02:33:49.480 --> 02:33:50.970 And then you can, per your comments, 02:33:50.970 --> 02:33:53.436 we can look at whether if we need 02:33:53.436 --> 02:33:54.520 to fine tune that in the future. 02:33:54.520 --> 02:33:55.927 Right and agreed 02:33:55.927 --> 02:33:57.470 and I wanna stress this as well. 02:33:57.470 --> 02:34:01.020 And I think this is down in the planning models 02:34:01.020 --> 02:34:04.120 and like Liz said, it's the first screen 02:34:04.120 --> 02:34:06.120 to see whether or not a project is even needed. 02:34:06.120 --> 02:34:08.630 So there's a lot of steps that still need to occur. 02:34:08.630 --> 02:34:09.710 But I still want to, 02:34:09.710 --> 02:34:13.310 before it gets to us in terms of a CCN approval, et cetera. 02:34:13.310 --> 02:34:14.650 But I do wanna stress again 02:34:14.650 --> 02:34:16.430 that obviously not a blank check 02:34:16.430 --> 02:34:20.470 and no determination on whether projects are needed or not. 02:34:20.470 --> 02:34:23.900 This is just a percentage change 02:34:23.900 --> 02:34:26.830 to account for the fast-growing population 02:34:26.830 --> 02:34:29.130 and economic growth that we have in our state, 02:34:30.201 --> 02:34:33.050 in all areas of our state in one form or fashion. 02:34:33.050 --> 02:34:35.010 So but that's it. 02:34:35.010 --> 02:34:36.210 I think I'm comfortable moving 02:34:36.210 --> 02:34:37.710 from five to seven and a half percent. 02:34:37.710 --> 02:34:42.710 And with respect to your long-term process 02:34:43.360 --> 02:34:44.440 that you've proposed, Liz, 02:34:44.440 --> 02:34:47.100 I think that's either a planning guide revision request 02:34:47.100 --> 02:34:49.330 that you can work with with ERCOT on submitting. 02:34:49.330 --> 02:34:52.870 Or, we as a Commission, could include something 02:34:52.870 --> 02:34:55.780 in our rule whenever we- 02:34:55.780 --> 02:34:58.580 Well, I'd welcome a suggestion from 02:34:58.580 --> 02:35:01.430 and encourage you to continue exploring this 02:35:01.430 --> 02:35:04.140 and come back with a suggestion. 02:35:04.140 --> 02:35:04.973 But I think for today, 02:35:04.973 --> 02:35:06.010 we've got a pretty good line of sight 02:35:06.010 --> 02:35:07.530 on what action we can take, 02:35:07.530 --> 02:35:10.636 if you've got a motion you'd like to propose. 02:35:10.636 --> 02:35:12.060 Well, with that, I would just say 02:35:12.060 --> 02:35:16.420 that we can direct ERCOT to increase the boundary threshold 02:35:16.420 --> 02:35:18.210 from 5% to seven and a half percent 02:35:18.210 --> 02:35:19.930 in the remaining seven weather zones 02:35:19.930 --> 02:35:21.870 to help accelerate the development of transmission 02:35:21.870 --> 02:35:23.590 for reliability in the state. 02:35:23.590 --> 02:35:24.423 Okay. 02:35:27.400 --> 02:35:28.233 All right. 02:35:28.233 --> 02:35:30.110 Thank you, Chairman, Commissioners. 02:35:30.110 --> 02:35:31.070 Thank you. 02:35:31.070 --> 02:35:32.820 Mr. Chairman. Yes, sir. 02:35:32.820 --> 02:35:34.843 Before we move to the water issues, 02:35:35.740 --> 02:35:37.850 may I suggest that we go to closed session? 02:35:37.850 --> 02:35:40.790 We're about to run out of time with our Attorney General 02:35:40.790 --> 02:35:42.080 sitting here. 02:35:42.080 --> 02:35:45.260 All right, we will recess after completing 02:35:45.260 --> 02:35:49.483 item number 20 and move to closed session, 02:35:50.375 --> 02:35:55.375 pursuant to Chapter 551 of the Texas Government Code, 02:35:57.280 --> 02:36:02.280 sections 551.071, 551.074, and 551.076. 02:36:04.350 --> 02:36:08.623 We will be back to pick up our agenda on item number 21. 02:36:10.220 --> 02:36:11.480 Woody has one last set on the economic criteria. 02:36:11.480 --> 02:36:12.908 I can be fast. 02:36:12.908 --> 02:36:13.810 I can be really fast. 02:36:13.810 --> 02:36:15.203 We gotta recess. Sorry, Woody. 02:36:15.203 --> 02:36:16.623 When we come back.