-: All right.
We will now reconvene this meeting
of the Public Utility Commission of Texas.
We are gonna bring up again,
docket 51023 for one more public speaker
to present oral testimony, three minutes,
as with all the others.
Three minutes, please, sir.
Please state your name and who you're with for the record.
-: All right.
My name is Raul Figueroa.
Last name is spelled F-I-G-U-E-R-O-A
and I live at 26670 Karsch Road in High Country Ranch
and I'm habitable structure umber 16
on the CPS inventory map.
I oppose recommended Route C2
and the proposal for a decision.
The PFD is flawed in my opinion,
because it has errors regarding my home
and the High Country Ranch neighborhood.
As I stated in my exception, AOJ
described me as a landowner, close to High Country Ranch.
This is incorrect as I am a home and landowner
inside High Country Ranch.
The AOJ's also a state in the PFD that Route C2
does not cross a neighborhood.
This is another incorrect statement as Route C2
segment 46B runs across the High Country Ranch
neighborhood.
Route C2 segment 46B,
which surrounds my home and property on three sides.
When my wife and I purchased our home in 2014,
one of the deciding factor was whether
we could spend the rest of our lives in it.
And the answer was a definite yes.
We consider it our forever home.
It has a 20 mile view to the west.
It has the 20 mile view to the east
and a beautiful view to the west.
I asked the Commission to imagine stepping out
of your home and seeing a transmission line segment
from three sides of it ranging from 162 feet
to approximately 300 feet.
This is exactly what my family and I would experience
every single day should recommend Route C2
and the PFD get approved.
My wife's stepdaughter and I will not have
one single enjoyable area around our home
without staring directly at a transmission line.
The only side of our home that will not face
a transmission line,
sits a garage and a fence line that separates
my property and my neighbors.
My wife suffers from a condition called bipolar II,
for which she must take medication on daily basis.
She keeps this health issue private,
but authorized me to go ahead and mention it
in order to emphasize the importance of a serene view,
of a stress-free view and environment.
-: You have one minute left, sir.
-: Okay.
The biggest symptom of this condition is depression,
which she must take medication for,
but also the beautiful view helps her as well.
That's a natural remedy for it.
Furthermore, the transmission lines around my home
on three sides, there's a high probability
that the transmission line
that it will cost interference with my cell phone
reception and Wi-Fi.
The CPS witness could not guarantee or make assurances
that my cell phone reception would not be interrupted.
I work from home on a full-time basis
for an out-of-state employer that provides
software solutions to department defense contractors.
And it's vital that my cell phone service
and internet be reliable.
I am baffled to the fact that the administrative judges
did not select Route P instead of Route C2.
I urge the Commission to please consider Route P
or any Northern route that does not include segment 46B.
And I'm also not opposed to Route Y.
-: Thank you for being here
and thank you for accommodating the delay.
Sorry, we didn't get you in on that.
-: No, not a problem.
-: Original sign-up.
-: Thank you again.
I appreciate it.
-: All right.
That concludes business on docket 51023 for the day.
We'll table that for a future open meeting.
Next item I believable will be docket 53116.
You may state your name.
-: Yes, sir.
Item 14 is docket 52116.
It is an agreed NOV between SWEPCO and Commission staff
regarding the reliability standards.
A revised preliminary order incorporating,
I mean, proposed order incorporating corrections
was filed on September the 14th.
-: All right.
Open up for discussion if anybody's got thoughts
or comments or questions.
-: Can I make a general statement?
-: Absolutely.
-: Not that I need your permission, but thank you.
(laughing)
We've seen a lot of these settlements
come across the dais here since I've been on the Commission.
I don't know if that's common or not,
but they all deal with (indistinct) and safety
and they're all dealing with...
So that's the frequency and the duration
of outages and how they affect consumers.
I had a discussion with SWEPCO last week
about a recent outage,
where they had a 20 foot tree growing in the right of way.
And 6,000 to 7,000 residents lost power
for a certain amount of time.
They admitted that they made a mistake
and how it happened.
And I understand it.
But again, what I go back to is vegetation management
is so key in these issues.
A 20 foot right of away,
they claim that they use insecticide or herbicide
in the right of way.
But the plan was to cut the tree down next year.
Well, we've gotta do better than that is what I'm saying.
We can't let 20 foot trees go in our rights of away.
It doesn't matter when we plan,
we gotta use technology.
We gotta find ways to make sure
that these rights of ways that we've granted,
that these utilities manage for the good of consumers
are kept clean and that, you know,
trees that are growing like that,
especially in wet weather years or the year after.
These aren't hard issues to resolve.
They're time-consuming, they're costly.
But in my opinion, we have to see better on this space.
-: Especially if you know the problem's there.
-: That's right.
-: This year, not next year.
I agree with everything you said.
I know this is an issue you've also (indistinct)
and I appreciate that focus and support the direction
both of y'all are taking.
It's often overlooked,
but absolutely critical part of day-to-day reliability.
Any other thoughts or comments?
-: No.
I was comfortable with the revised proposed order
and would make a motion to approve the revised order.
So moved.
-: Second.
-: All in favor, say aye.
-: [Commissioners together] Aye.
-: Motion passes.
Next item, please.
Number 18, I believe.
-: Yes, sir.
Item 18 is docket 52282.
It's a complainant BHC property management
that gets NG Resources.
Drop preliminary orders filed on October 19th.
Commissioner McAdams has a memo in this matter.
-: Would you like to lay out your memo?
-: Well, I was excited to see this case
show up on the agenda.
And it was because this is sort of our first opportunity
to take a bite out of an apple or an issue
that we have been talking about
since I came into the Commission and you Mr. Chairman,
and so on.
Form contracts, mean form contracts.
And we had this whole conversation
after Winter Storm Uri
as the human cry from the public on their charges
that they were experiencing was starting to flare up.
Well, now we have taken action.
This Commission has adopted with legislative guidance
and legislative tools.
We have adopted a securitization framework
and that's moving forward.
My memo was designed to make sure that that is captured
in the questions that should absolutely be addressed
in these preliminary orders and for ALJ consideration
as these topics move through the process.
And that way we can get a good sightline
on how these tools will be used for the benefit
of the consumers that they were expressly designed
to affect.
-: Commissioner McAdams.
Thank you so much for your leadership on this issue.
This is an important issue.
I think not just now, while I'm currently serving
as a Commissioner here.
These are issues I experienced
when I was serving as public counsel at (indistinct).
And we received many consumer calls
from sort of larger commercial customers.
Not really the smaller commercial,
but just bigger than smaller commercial customers
throughout the state that were getting ancillary
service charges passed on to them.
And in many times they were just huge, huge amounts.
And it was really tough, you know,
hearing those concerns.
These were mom and pop businesses,
that were getting $100,000 bill that no one can file
for those types of bills.
And while I recognize that many of the companies,
and it was a handful of them that passed down these costs,
or at least those are the calls we got,
per their contract could pass these costs along.
We've got to close the loopholes.
And I think, you know,
4492, house bill 4492 specifically provided
a pathway for those customers to get a refund
and a credit in our debt obligation order
in Docket number 52322,
an approval of a settlement agreement
that requires the companies that get securitization
financing to credit and refund the customers
is extremely important.
We've gotta provide that relief to those customers
that got those causes passed on to them.
And so I commend you for highlighting this issue
since we might get more of these cases come before us.
'Cause I know we encourage customers to file complaints
just so they can get on the record.
And at some point we can come up with some framework
to address these issues.
And here they are.
Here's the first one with the complaint by BHC property
management versus NG Resources.
And so I would, if you will,
ask even more specific questions
so we can ensure that we get all of the information
we need in the record.
And I think your broader question is definitely important.
If you will just kind of, you know,
bear with me a little bit.
-: Have at it.
-: I would say that I think the first question
should be what effect does the Commission's
debt obligation order in docket number 52322
have on this case?
So, very similar to your broad question.
'Cause I wanna tie it to the debt obligation order.
'Cause that's where the requirements to refund
and credit are specifically prescribed by the Commission
and per HB 442.
Second question I would ask is,
is NG Resources LLC receiving securitization proceeds
pursuant to the debt obligation order
in docket number 52322.
Third question is if so, is NG Resources LLC
required to provide a refund or credit
to its customers for ancillary service costs
in excess of the system-wide offer cap
and for reliability deployment price at our charges.
And what is the amount of the refunded credit?
So I wanna make sure that we get all this information
in the record and as we get other cases,
potentially other cases that involve reps
that pass these costs down,
and we just, you know,
plug in the other company's name
and we have these specific questions
laid out in our preliminary order going forward
so that we get the facts in the record that, you know,
this rep hasn't opted out of 52322,
and that they recognize the requirement to refund
and credit their customer
and how much they planned to do so.
-: Can we edit your last question to include refund
and/or provide long-term financing for any
remaining obligations.
If they put them up on a payment plan.
-: Sure, however we wanna capture that.
So, what is the amount of the refund or credit or...
-: Any long-term financing or payment plan made available.
Does that work?
-: Yeah, I think so.
So I would say just to help Steven a little bit is,
what is the amount of the refund or credit,
and also provide us with information
on whether they are entering into payment plans
with their customers that are owed a refund
or credit as well.
Or something along those lines.
We can work with you offline.
-: So I think we would ask are they required
to provide a refund or a credit,
that's the statutory directive.
And then we could say, if so, what is this amount?
And are you using a long-term financing
or payment plan to recoup these amounts?
Something like that?
-: Making a long-term financing plan available to customers,
or the customer.
-: We may have to just make that a separate question.
A sub-question.
-: Sure.
-: Yeah, that'd be good information.
-: Yeah, both of y'all are asking important questions.
Are you comfortable adding the association to the dead order
to our question with her question?
Tighten that up.
-: Yep.
-: And thank you for your consideration,
Commissioner McAdams.
Again, I really do thank you for raising this issue.
It is a very important issue and for being open
to my additional specific questions and Chairman Lake
for your additional question.
-: Thanks, Commissioner.
-: All right.
Is there a motion to approve the preliminary order
with the addition of the questions outlined
from the dias today?
-: So moved.
-: Second.
-: All in favor, say aye.
-: [Commissioners together] Aye.
-: Motion passes.
That brings us to item 19.
I believe Commissioner Glotfelty,
you've got a few things to discuss on this one.
-: Thank you, Mr. Chairman.
I did request that project number 46304
be added to the docket today.
As a little background,
one of my first meetings a few months ago.
So Commissioner Cobos was talking about the expansion
of transmission.
One of the issues that what was brought up
that we discussed during that open meeting was
the Southern cross-transmission line.
The chairman suggested that I do a little bit
of research into this and try to figure something out.
And I'm happy to report that I've kind of figured
a little bit of it out, but not the entire thing.
Thus, I have a path forward.
So this project has been in regulatory review
for seven years, which is a long time.
I'm not saying that we have all of the information
to make decisions yet.
ERCOT hasn't completed
their review of all of the directives that we gave them
in the original order.
There are four remaining.
I think two of those can be done now
and two of them have to be done at a later time.
And I think there are other areas that parties
have suggested that need some attention from us,
including a revision or a look at the export tariff
and the cost of that as well as more in general,
the transmission planning for DC ties.
What I propose is that we ask parties
that are in this docket to come and tell us
what the path forward is.
There are a lot of things
that are actually going on on this.
ERCOT has given us their ninth status report
a few weeks ago.
The committees at ERCOT are working through the issues.
But I don't yet have a path forward that I can say,
this is what we need to do, A, B and C.
I think we need to do that together.
But I think if we can get the parties to file
what they think the next steps are,
it will let us narrow down that funnel of the issues
that we absolutely have to address.
Projects like this that are not rate-based projects,
kind of live and die in regulatory limbo.
It's private capital that's being spent.
And it's my view that,
if it's in the public interest,
we should ensure that we resolve our issues
so that the private capital can be spent
or the private capital will go somewhere else.
And either one of those is okay.
That's the market, that's supposed to decide that,
but the regulatory responsibility and the ERCOT review
are things that we can speed up finalize, and be done with.
And so it's my recommendation, again,
that we ask parties to come forth,
tell us what the steps are that have to be done
to be completed.
And then we can not take action on those,
whatever's proposed.
-: Makes sense to me.
-: Yeah, no, thank you, Mr. Chairman.
If I may ask a question just to crystallize that.
And frankly, on his face,
I think this is gonna be helpful.
So the update, you know,
and we've all received updates
and we've received updates officially, but again,
I think we are very close to ERCOT finalizing
their portion of the review.
And there's an ERCOT responsibility portion
as per the directives that the Commission adopt,
a statutorily authorized.
And then there's sort of also a non-ERCOT,
the other side of the border portion.
So your intent is that the update could help clarify
what is remaining on our side of the border,
and then what is up to those counterparties
on the other side?
-: Absolutely.
So, what I want to do is make sure
that it's crystal clear what ERCOT has to do,
what the applicant has to do,
and what we have to do.
-: I'm all for that.
-: Sure, yeah.
-: And timeframes to get them resolved.
-: No, I just, you know, thank you for the update
and your diligence on this issue.
I think it's important.
I mean, it has been several years
and to maybe level set to see where we're at
and, you know, have a roadmap of anything
that ERCOT or the Commission could do to, you know,
at least do our end of doing the due diligence on this tie.
-: What form would this take in practice?
-: The form would be for them to file
within the existing docket, which is 46304.
They would file information within that docket.
And since it's already open--
-: Do you want to file a list of specific questions
or scope of questions, or you wanna just have them
respond to your--
-: I think the record is clear.
They know what needs to happen between now
and when they're finally approved.
Just let us know that.
Again, all three parties.
-: Keep it simple.
All right.
-: So you just wanna leave it this informal
then file when they want to,
or do you wanna issue an order of this got timelines
and requirements?
-: I'd rather--
-: Strong guidance from the dais.
-: I'd like it before the end of the year.
I mean, this all plays into market redesign as well.
-: I would like it sooner than the end of the year.
I'd like it within 30 days, if we can get it.
I think a lot of the stuff they're working on now,
so having something filed with the Commission
shouldn't be a huge lift.
Does that require an order or does that require a...
-: Take an order might be useful.
-: 'Cause it'd be nice to know 3000 megawatts
of DC capability we're gonna play in this whole market
as we start moving forward.
-: So, how would I propose an order to do that?
We order what we just discussed?
-: Yes, tell me to go draft you in order and make a motion
to so do so and then vote on it.
And we'll go do so.
-: I would suggest that you draft a memo.
-: Can you make a motion?
-: I make a motion that Stephen drafts a memo,
the staff drafts a memo, an order, excuse me,
an order outlining the issues that we just discussed here
and that parties file comments back, answering the issues
we discussed within 30 days.
-: And I would second.
-: 30 days of today.
So we've got a motion and a second.
-: 30 days of the date the order goes out.
-: 30 days from the date the order goes out.
-: Okay, you got a motion and a second.
All in favor, say aye.
-: [Commissioners together] Aye.
-: Motion passes.
There we go.
Next item 20 and 21.
I don't have anything on those items.
Do y'all? -: I don't think so.
-: It brings us to item 22.
We've got a staff memo.
-: So 22 is project 52307.
It's a review of the rules of ERCOT.
Staff filed up a memo
discussing some actions of ERCOT
with a proposed order for the Commission
to approve those actions of the ERCOT board.
-: And for background for those folks watching at home,
these are the items that were approved
with the most recent ERCOT board meeting.
I think it's pretty straight forward
and it's been well vetted.
At this point, the only thing I would mention
is that in addition to NPR 1093 and OBDER,
sorry, NPR 1093.
In addition to that bringing more load into play
for our non spend resources
would emphasize the importance of NPR 1101
as a follow-up on that
to ensure that those resources are deployed
in a resource agnostic way
as soon as possible after implementation
of that new load resource.
So we will be enhancing our margin of safety
and doing it in a resource neutral way,
encouraged stakeholders to continue moving NPR 1101
through the process with all alacrity.
Is there a motion to, or any other thoughts or questions
or a motion to approve the proposed order?
-: So moved.
-: Second.
-: All in favor, say aye.
-: [Commissioner together] Aye.
-: None opposed.
Motion passes.
Item 23 regarding statutory definitions.
Would Mr. Smelser please approach?
-: Chairman, Commissioners,
David Smelser, Commission staff.
Today we have a simple PFP.
This is just a box-checking rulemaking
where there's a number of statutes
that were passed that can be implemented by us
just updating our definitions to match the definitions
and statute.
An example of the sorts of things that are involved
is for instance, if you're a electric vehicle
charging station, you no longer gotta have a rep certificate
or electric utility.
It's stuff like that.
And then there's some code cleanup items
that we just do whenever we open these roles.
So it's a pretty simple, generally non-substantive
rulemaking just to move forward on some of this legislation.
-: Appreciate your diligence on it.
Any questions, comments?
-: Well done, copy and pasting from the statute.
-: Happy to do it.
-: You're very diligent and thorough copying and pasting.
-: I actually made Christine do it before she left.
I needed a little help on the copy-paste.
-: There you go.
Is there a motion to approve the proposal for publications.
-: So moved.
-: Second.
-: All in favor, say aye.
-: [Commissioners together] Aye.
-: Mr. Chairman.
-: Yes.
-: This is an item that we didn't include
in our list of issues to deal with the Consent Agenda.
Is this the type of item you'd like us to add to that?
I can do a revision to that, bring it back to y'all.
-: I certainly wouldn't be opposed to that.
-: Would not be opposed.
Did I lose money?
I had a bet going on with Steven on this.
-: Not a bet about me asking y'all if y'all wanted to do it,
but...
-: I'm sure we can take that offline.
I appreciate a revision as described to that.
-: I will bring it to you as time allows.
-: Appreciate it.
All right.
That will bring us to item number 24.
We have a couple items Commissioner McAdams filed in memos.
So I'll ask him to lay that out fo us.
-: Yes, sir.
And welcome feedback.
This memo is again,
I'm very proud of my staff.
They keep it concise,
and that's intentional.
This memo is the product of stakeholder conversations,
conversations from this dais in previous workgroups
about the concept of prioritizing dispatchable resources
within the transmission interconnection queue.
I will highlight a couple of concepts here
and note that it is...
And my memo can speak for itself,
but it is my belief that this prioritization
does not necessarily push any resource to a back of a line
or cause them to restart a process.
This is policy is designed frankly,
to provide guidance to transmission service providers
in the event of a real land rush,
for lack of better words,
in resource interconnection interests.
Scenarios, like when Chris was built,
always present themselves.
Whenever new transmission lines are built that open up
vast territories that offer good resources
for Texas consumers and ERCOT
to gain new resources for the system.
There's always a surge of interest in interconnection.
To be ahead of that,
as in case and point, we've discussed before
the lower Rio Grande valley,
whenever that area becomes available
to developers, resource developers, generators.
There's gonna be strong interest in that area
to deploy quickly.
And our transmission service providers
need to have some type of guidance from this Commission
on what is important to take up first.
And that's the overarching policy of the memo.
It prioritizes in steps what you should look at first,
second, and then third.
It also allows flexibility for ERCOT.
Again, I'm trying to keep this policy high level
so that we don't have any unintended consequences
of being too specific in our instruction,
but I would like the experts at ERCOT
to have the flexibility to determine
how a battery within that two-hour dispatchability parameter
can play into that.
As you've said, Mr. Chairman, you can tie them together.
You can scale them up.
You can use them in a modular way.
-: Physically or financially.
-: That's right.
I do not wanna discourage battery deployment
to not request the full extent
of their technical capabilities in their interconnection.
We want the full megawatts.
But ultimately we also want them to be able to cover,
which is in our interest over the next several years
to cover a full two-hour period,
because that's what ERCOT is telling us
that we're desperately going to need in the near future.
And so from a standpoint of giving the engineers
at ERCOT the ability to say,
"All right two hour capability."
But and your applying for 100 megawatt
battery interconnection,
'cause that's what you think you're gonna need
on this project,
but we're talking about a two hour discharge capability
of 50 megawatts for two hours.
Then I want them to have the flexibility to front-load that
'cause 50 megawatts for two hours is gonna come in
real handy in 2023, I'm sure.
Hopefully or 2024.
So again, I wanna allow that flexibility,
but still prioritize on a reasonable basis
in the event that we have a panacea
of generators wanting to get into the ERCOT market
after our market reforms go into effect.
I realized there's been some discussion
about TAC and our governing rules.
I still having reviewed TAC Chapter 25, 196 and so on.
I believe that we have the flexibility to prioritize still
in interconnection and I'll leave it at that,
but I welcome any conversation on this topic.
-: Sure, I've got a couple questions on there.
I'm sure colleagues do as well.
So I'll open it up for questions or comments.
-: Go ahead, Mr. Chair.
-: I like what you laid out here and I'm very grateful
for you grabbing this bull by the horns.
It's something that needs to be addressed
and is an important step forward.
More on the more logistical side.
-: Yes, sir.
-: On your second bullet point
and I agree philosophically with your sequencing
of everybody's resources and projects,
co-located with inverter based resources
that maybe dispatch for two or more hours.
Is the entire project gonna be included
in that second traunch of prioritization
or just the capacity that is associated
with dispatchability?
-: No, sir, the entire project.
Again, we want, in my view
and this is where we need to iron out the logistics of that.
The intent is to give a market signal of desirability
of performance.
And again, a market signal that those resources
that are in queue should have every reason to go out
and procure a dispatchable component to their project,
either a wind farm or a solar farm.
And so in my view, it's in our interest to insent
every bit that we can get.
And so it should be able to qualify that entire project
under the dispatchability of that battery.
-: In anticipation of gamesmanship.
-: Yes, sir.
-: Along the lines of a one megawatt two hour
dispatchable battery attached to 100 megawatt
or 1,000 megawatt wind farm.
-: Yes, sir.
-: Doesn't really solve what we're aiming for.
Would you consider some sort of minimum hurdle
of associated two hour or more storage, like 30, 50,
60% thing to say that you can't just
put a battery in the corner and qualify.
So it's gotta be real, real numbers.
It's gotta be real dispatchability.
-: Yeah, if we were to consider that the ITC,
the investment tax credit has a threshold for solar
and it's 75% of the energy produced from that,
I believe that might be the recoupment threshold.
They take at least 75% of the energy
that's gonna be discharged from that battery
from that project that it's co located with.
-: I don't know off the top of my head.
-: Yeah, my understanding of the ITC is just basically,
it's a tax credit and the last time I looked at it,
which has been a little while it was 30% out of the project.
So like if you had a $100,000 project,
30% tax credit so that you wouldn't be giving
to the federal government.
-: Offsetting other income.
-: But my point is that the federal government
will pay for the battery if they take up to 75%
of the energy that's dispatched from that battery
from the co-located solar farm.
So it gets bundled in.
And so in order to have a consistent policy approach
and thus get more.
Yes, sir.
-: Very good.
So you qualifies for bullet point to the second level
of prioritization if...
It's not working well.
-: The batteries total capacity equals 75% of the project
or more of the project that is co-located.
-: Okay.
That makes a lot of sense and appreciate your consistency
with federal policy.
-: I'm trying to line this up somehow.
-: The second question is both a question and a comment
about the two hour or more dispatchability requirement.
If you're comfortable and the operations team
at ERCOT is comfortable with that,
there's been a debate about that.
Then I'll defer to the operational experts on that,
but I wanna make sure that we are putting
the operational need first and we're not letting
the current available technology just because we've got it,
let's make that fit into a wag the dog or operational need,
because first and foremost,
we can't sacrifice operational reliability
just so we can fit a round peg into a square hole.
And secondly and just as importantly,
is that the way to incentive...
I mean, the way to incentivize continued
and more aggressive development of these technologies
is to set the higher standard and put the incentives there
so the technology needs to match our operational needs,
not matching the incentive
to what the market already provides.
I'll defer to you in the operational team at ERCOT
on what that hour requirement, minimum hour requirement is.
But I certainly do not want in a year or two
to be hearing about how we don't our dispatchability
doesn't cover the full duck curve.
And that's not a comment to you,
that's a comment that the battery industry.
I don't think any of us wanna be getting those calls
saying we're dangerously tight in our grid conditions today
because two hours turns out not to be long enough.
So let's maintain that operational reliability
principle first and work backwards from there.
We don't need to solve it today, but like I said,
I just wanna...
-: Philosophically, if you're looking for another vote
on any type of concept, I would vote for that.
I support that.
That is the basis for this entire prioritization.
Again, we're trying to give a market signal
that supports our operational reliability on the system.
So at this time anecdote,
I mean, that's what we've heard we need,
but again, that's not a statement
that this isn't gonna evolve.
I mean, it needs to be able to evolve
and we have to be able to adapt with that.
-: And Commissioner McAdams,
thank you for your update on the memo.
We had several discussions about this topic
at our work session and over the course
of the last couple of work sessions and now today,
I think your updated memo is really trying
to move in a direction that that does send
the appropriate market signal and is more tailored
to what, just setting that bar just a little bit higher
so that we can drive that on to our batteries.
My understanding is that most of the batteries
that are in are ERCOT right now in the queue
are one hour, one and a half hour.
The duck curve that we're gonna be experiencing
in the next one or two years, at least initially,
maybe about two hours.
So I'm taking all of those issues into consideration
and certainly appreciate,
I'm not as well versed on the storage ITC portion,
but staying consistent with federal policy,
I think makes sense so that you can drive that innovation
and send the right price signal.
And we're getting those technologies in there.
But Chairman Lake, I see what you're saying as well
on the operational end of it.
My thought process has been,
we're gonna get these resources, solar resources in Texas.
Let's try to figure out a way to encourage them to show up
with storage as best as we can.
And I understand your comments about,
well, let's just not like, you know, get everything
sort of custom tailored to provide...
To fit that need for the solar plus storage.
I certainly understand that.
My understanding my discussions with ERCOT
is that they'll have a set of tools
to address the duct curve,
whether it be online generation resources,
potentially some modification to non spin
or just non spin period, and then eventually ECRs.
So I think your updated memo moves it closer
to the line of trying to drive that innovation
and that drive that innovation to provide
some of the reliability/operational benefits
that we're looking for as we have a significant increase
in solar in the next few years.
I, myself looked at (indistinct), looked at the roles.
And I think the fact that you're not stopping
any resources from interconnecting, if they're ready to go.
They won't be stopped from being interconnected.
But if there is a situation where prioritization
needs to take place, then ERCOT will prioritize
based on what resources would be available
to provide the dispatchable reliability need
or service that we need.
My understanding is that perhaps ERCOT
already does some of this already.
And if that is the case, I mean, I would love to hear
from you know, if Woody,
is this something y'all normally do already
with respect to like when you have a mass amount
of say projects, so that are looking to be interconnected
and you have to do some kind of prioritization.
Is this something you look at today?
-: Woody Rickerson with ERCOT.
So today through the screening process,
we do not take into consideration multiple units
connecting the same place.
We know we don't tell the other people
there's other competitors there.
Is that what you were asking?
-: Well, like If you already had projects ready to go,
and do you do any prioritization right now?
-: Oh, I'm sorry.
So on the interconnection process.
So a month ago we've made a change in the way we,
within the protocol guidelines that we currently have,
we moved dispatchable generator to the top.
So if we had a dispatchable generator
and a non dispatchable generator,
our part of the interconnection process,
we already moved that dispatchable one to the top
while at the same time,
maintaining all the required protocol.
So everyone in the queue will still meet
all the protocol timelines,
but we're getting to prioritize the dispatchable unit.
-: So in other words, Woody,
nobody slides to the bottom or anything like that.
It's a question of when you have five projects
in a given area and you're trying to sort bandwidth
and get the necessary studies complete,
all those phases of studies,
concurrent with transmission service providers
who are doing their studies,
their portions of the studies as well.
This concept that you've heard from the dais
simply provides some sort of order of merit
in terms of prioritizing manpower
when you have five projects.
You take that dispatchable first
and then you get to the intermittent.
-: Yeah, we're not compromising any of the timelines
that we're mandated to meet for anyone.
Anyone that has a generation interconnection project,
we're meeting all the protocol timelines for everyone.
The only difference is now we have prioritized
the dispatchable.
And I think it's important to keep in mind--
-: And what was the discussion about that?
I mean, it internally about why you did it
about how you did it.
Was there broad discussion amongst the stakeholders
at ERCOT or was that...
Can you fill me in on that?
-: Well, I think the context there is that ERCOT
is just one piece, one link in that chain.
So if you think about this chain of events that has to occur
for a generator to be interconnected,
ERCOT has a piece here and a piece here and a piece here.
So when we get to our piece,
we're moving the dispatchable stuff to the top.
Now there may be a way that we can decrease
the length of the chain also,
but for the guidelines that we currently have
and the protocol requirements we currently have,
we're just prioritizing the dispatchable.
Now, all these other links in the chain
that occur with TSPs,
I mean, that's a lot of what the discussion has been about.
-: I'm still a little unclear on it.
I mean, it's my understanding that when a generator files
in the interconnection cube,
they go to the transmission provider first.
They pay an application fee.
And in fact, there's a process right there
where they can expedite
with many of the transmission providers
where they can expedite using something
called a discretionary spending account,
where if they pre-fund the discretionary spending account,
then the transmission service provider
can not only do the studies, but they can also do
engineering work perhaps on a substation
or an interconnecting substation.
And that is allowed by every resource.
And if that's the case, do we even need to do this?
Because, I mean, again, my view,
I'm worried about those that are in the queue today,
Queue in ERCOT is different from the queue
in every other region because of the cost allocation
component of transmission upgrades,
which a lot easier here in ERCOT, obviously.
But I'm worried about those projects that have site control,
that have PPAs associated with their projects.
They have contractual delivery timeframes,
they have ordered equipment,
all of these things that bind them.
And most of those in this day and age are renewables.
-: Sure, does the grandfathering clause address
in (indistinct) address that concern?
-: Well, I don't think we've explored that.
And I mean, that's where I would say
I would wanna have a deeper discussion about how we...
Because this is substantial capital.
This is not 45 grand or 50 grand.
These are millions and millions and millions of dollars
that are being tied up in these capital projects.
And that if we just arbitrarily jigger them around,
because we want to, that's not a good signal to the market.
It doesn't incent.
-: Sure.
-: It does not insent dispatchable either
because we could change the rules again
and just go back and prioritize renewables
and then dispatchables fall.
So we have to be careful about what we do
and that we need to make sure that it is fair.
And those that are existing in the process...
-: Absolutely.
-: Have a method to stay in the process.
I know also if I...
Actually, I don't know, here in ERCOT,
if I submitted an interconnection for 100 megawatt project
and then have the ability to come back and add
75 megawatt battery storage,
I suspect I would fall out of the queue
and I'd have to re enter the queue.
Is that correct?
-: Depending on where you were in the process, yes.
-: Well, what technology you're talking about?
-: Well, any change...
If the change in a turbine type,
it will require different studies,
different stability studies--
-: Sure, absolutely. -: Different SSR study.
So the purpose of the generation interconnection process
is to safely and reliably interconnect new generation.
-: Absolutely.
-: I don't think there's anything in the process
that isn't needed.
We can't just go in and cut some fat out.
There's not any fat there.
Everything that's there is for purpose,
whether it's the TSP doing it, whether it's ERCOT doing it
or the review that you guys do,
it's all there for a reason so that when we do interconnect
that generation it's reliably interconnected
and we don't have to worry about it
causing a stability problem
or an SSR problem or overload of line
or something like that.
So that's the...
I think the background for all this is that all these things
are needed.
Maybe there's a way of lining them up
so that we can decrease the interconnection time
essentially.
Maybe there's something we can do,
but these engineering studies are needed
and they do take time.
-: And the timeframe now is about two years
to go from start to finish.
So if you were put in a year and a half ago
and then we've rejiggered this,
'cause you're just a wind farm with nothing else.
I mean, that's where I'm concerned.
And what I would say Commissioner McAdams
is I would, if you wanna, I guess,
let me just say it this way.
I'd be happy to work with you
on what these grandfathers are.
I would be happy to have that discussion
about real examples,
not just talking with the transmission owners
and what their interconnection process is,
but understanding some of the real life PPAs associated
with some of these farms with some of these projects,
wind farms and solar farms and such.
-: Yeah, no, I'm fully sensitive to that.
And I'd welcome working through it, but I'll say this,
there is 100,000 megawatts of solar in queue
ballpark right now.
And power is no different than any other market.
The costs are no different.
If I go out and buy a lot down the street from my house
on a speculative basis and just hold the lot,
and then I get into some type of weird permit process
on like, but again, it's just a matter of fact case
in point, I know I'll get a call from an HEB lobbyist.
HEB in my neighborhood
has been talking about putting in a grocery store
for 10 years.
And they've got preferential treatment from the developer
or from the city in that neighbor
to get that thing permitted and put in that grocery store.
And they're holding this property, which is quite valuable
to possibly put in that store.
But at the end they might flip that to somebody else.
So they put in the bare minimum of capital
and they're holding their place in a permit line
to get fast tracked through.
And at the end of the day,
we've gotta overcome those barriers.
And I get they've got capital invested
somewhere in their model.
But for our view again,
when we look at what only we can see,
and again, I can't see what arrangements they've made
so far in advance to hold that speculative position in line,
but I can see when they collateralize with ERCOT
and the TSPs and then they pay those interconnection amounts
so that the studies can proceed
and they're paying their way.
We see that and we see that point in the line
where they progress enough to where it's a financially
and technically viable project.
So that's, again, the--
-: Agreed.
There are a lot of projects in the queue
that do not wanna be studied
in the interconnection process today.
-: Yes, sir.
-: Because there are companies that have limited resources.
Their turbines may not come for 24 months or for four years.
And you wouldn't want to spend your capital
on the interconnection process today
on a project that you know is so far off
because of some of the examples,
they may sell it to somebody else,
let somebody else take the capital risk.
-: So with that...
-: But the question, you know,
so that's not the issue that I'm trying to solve.
I'm just trying to say that we have to figure out.
Well, first of all, the problem that we're solving
is not that I'm aware of that dispatchable plants
aren't getting their interconnection studies.
I have never heard a single company
that has a dispatchable plant come in and say,
"My interconnection cost is way too long.
"I'm sorry, timeframe is way too long.
"Please help me get through it."
-: So, yes, sir.
And I agree and that's why I don't believe
this is gonna be an issue for those
who have committed capital to buy equipment
that are gonna deploy over the next two years.
Nobody has told me that this is gonna be an issue.
They worry about the signal that this sends
to their financiers.
And frankly, if their financiers have already given them
money, they're kind of in bed with,
I mean, they're committed.
And so what I would say is that this doesn't put them
to the bottom of any list, it does create an opportunity
that if somebody goes out and gets a two hour
megawatt battery, that a nameplate is 75% of the project
that they're co locating with,
they might get jumped in line
in terms of that engineer focusing on that project next
and getting it done, which is in the system's interest.
-: I hear what you're saying,
but I think a megawatt is a megawatt
and that if you're telling people that they have to go buy
put a 75 megawatt battery on a wind farm
in order to get through the interconnection queue,
this is a very massive transformation
of what we're asking for in ERCOT.
And economics may not work.
-: But the federal government has said that a megawatt
is not a megawatt on the basis that you're talking about.
It funds it to a degree that it's different.
It's fully funded by the federal government.
-: You believe everything they say?
-: Oh, no, I've seen it and I'm impressed.
-: I'll say a megawatts is a megawatt,
but every source of megawatt is not equal.
And I think we all wanna welcome all generating resources
to ERCOT given the strained situation we're in.
But I will say that we've got that a firm dispatchable
source of megawatts provides more value tomorrow
than the 40th fourth out,
you know, the 357th in plus one intermittent resource.
We like all of them, but the value of dispatchability now,
right now is greater than the value of an intermittent.
-: Yeah, I think I agree with 80% of that.
Not 20, but I think the price difference,
you know, I think a great dispatchable resource
at $12 gas is not as valuable as a zero cost wind resource.
-: Sure.
-: Sure, but when we've got 110, 120,000 megawatts
of installed capacity, we're not short on generation,
installed capacity generation in Texas.
The problem is a third of that can vanish.
-: I understand.
-: Like last week and so that's the value of dispatchability.
-: But I still go back to this question and that is,
if there are opportunities for discretionary spending
agreements already,
can't we just encourage the dispatchable to go use those
and get them done and go through the process,
like they're already going through the process.
-: They gotta come up with more money
at a time when they're already on economic
to get them to pay to play to fast track...
I'm sorry, I'm dropping all kinds of things
you shouldn't say, to get them fast track through a process
at a time when the federal government
is paying the other guy to play.
And so anyway, it's convoluted.
-: Everybody can use a discretionary spending agreement.
Everybody can put money in to fast track the process
and it doesn't take money out of your pocket,
it accelerates right the time of what you're spending it
because these are not dollars that you wouldn't have
otherwise spent.
It's fast-tracking engineering, contractor work,
other things that are required
for you to interconnect anyway.
-: Apparently the economic signals aren't there
'cause it's not being used.
-: Well, I don't know if they're not being used.
I haven't been told one way or the other.
-: The one that goes to our market design, right.
-: Partially, yeah.
-: And so I think in the meantime,
until that is decided upon and implemented,
anything we can do to clear the way
for dispatchable sources,
I think is valuable enhancing our reliability.
I am very, very, not 100% in agreement with you.
I'll go 110% agreement with you on regulatory certainty.
-: Yes.
-: And ensuring that we do not pull the rug out
from under folks who put real money to work.
That's not the way this Commission should work,
it's not the way ERCOT should work,
it's not the way the state of Texas works.
But I'm 110% with you on making sure
that people that put money to work
don't get cut off at the knees midstream.
-: What if a solar farm that is number four in the queue
is a 200 megawatt solar farm,
and they don't have storage associated with it.
-: Then the solar farm that does have storage
associated with it, I'd rather have a number three
in the queue.
-: I might be in the wrong place on the system.
I mean, that's (indistinct)
-: Segment by segment.
-: Well, I think my point is,
I hope what I'm getting across is that
there's not just one issue here,
there are a lot of issues that I think
if we wanna grandfather things,
we ought to have a bigger discussion than just one memo
and two discussions, is what I'm hoping.
That would be my plea is that we could hear
from all parties, have a bigger discussion about this
and see if it doesn't mean a hill of beans,
then we'll do it.
And we need dispatchable resources, I know that.
But I'm cognizant of a guy
who's been in the interconnection queue before.
And not fun sitting there deploying capital,
never knowing when you're gonna get something
and then to have something be modified
to say that it's gonna be delayed even more,
what happens then, your investors leave
and your project goes away.
And that's not a good cycle,
it's not a good signal to send to the capital markets.
-: Sure, but...
Agreed and on the other side of that coin though,
we need to have some signal or some mechanism
so that the investor that's willing to associate
their intermittent resource with storage and dispatchability
is rewarded for that additional investment
outside of crisis pricing.
-: The question that I don't know is,
could they say to a transmission service provider,
look, "I'll fully fund my discretionary
"spending account now."
And then they go and do it under existing rules today.
-: Very fair question.
And per your earlier suggestion,
would you to be willing to work on ironing out
those details, but on the grandfather,
grandfathering provision and clarifying
what exactly that looks like?
So we can ensure investment capital
that has been deployed is, that it's mandate
is respected and it's initial course
that was charted can be implemented
while also building off of Commissioner McAdams memo
a framework to signal and incentivize
and enable folks, investors who are willing
to invest in dispatchable storage.
Build on the principles he's laid out here
to find a way to do that.
These to be the interconnect here.
-: If Commissioner McAdams is willing to do that,
I would be glad to do that, absolutely.
-: I am absolutely happy to do it
and we'll continue to work on it.
I will say there has to be a line in the sand
and we have gigawatts of power
that are bearing down on our system in the next two years
that will have real reliability consequences.
And this Commission again,
and this is good, I enjoy this.
I mean, this is good debate, good discussion
and we will work out the details.
And it'll be for the best of our resources
one way or another.
But, if there's no give,
from the intermittent only community on this.
If there has to be a fight, let it begin here.
And because we've got to get some dispatchability
co-located with these projects,
and they must understand that,
and their economics have to start working out.
Because there's just too much anecdotal evidence
to the contrary that it does.
But I look forward to working with you on it.
We'll find a good place.
-: Thank you.
-: Yes, sir.
-: Alright, thank you, Woody.
We also on this item,
have a motion filed by staff regarding ERS.
The motion is seeking good cause exception
allowing ERCOT to deploy ERS before the EA declaration,
rather than waiting until we are in the emergency situation
to utilize the load resources that we have paid for.
I'm sure staff is available for comments if needed,
but at this point I'll open up for thoughts.
And this is a topic we've discussed
extensively in our various work sessions
and open meetings that open up their thoughts
and comments.
(speakers talking over each other)
-: It says a lot.
Good thought.
-: Well, first of all, thank you for laying that out.
This is a concept and I have to give some credit
to Commissioner McAdams.
He's been putting ERS on the table for a few months now.
And so in various memos,
but after our market design workshop session that we had,
not the last one, but the prior one,
ERCOT highlighted that there is some (indistinct)
with the emergency response service program
that they run.
And so as I was looking for additional near term
and short term, mid-term and long-term solutions,
I zoomed in on what can we do with the ERS right now
to help add it as an additional tool to our toolbox
or arsenal of actions that we can have
in place and can take, rather,
for this upcoming winter season.
And so I had conversations with ERCOT,
and really just for the public,
just to explain once again,
'cause I think this is important.
ERCOT emergency response service program pays load
and generation resources to reduce demand on the system
during emergency events.
So, in a continued effort to move away
from a crisis based operation of the market,
I had recommended or brought up as a point of discussion
last week's work session that the Commission
considered directing ERCOT to add more money
to the upcoming winter contract period.
which covers December, January and February.
And also consider granting a good cause waiver,
a good cause exception to our rules.
To allow ERCOT, to deploy ERS
earlier than an emergency event
to help ensure reliability
during this upcoming winter season.
And so the feedback that we got from ERCOT,
was that they would need to modify their RFP
before November eighth, to:
One, add more money and two,
to allow to basically use ERS
outside of emergency event earlier.
So with that being said,
and thank you staff for drafting
the good cause exception order.
Kenan Ogelman is here with ERCOT.
And I think there's one sort of clarification
that I would like to give ERCOT and Kenan
about their deployment of ERS.
I think there was a question,
I think their good cause order says,
may deploy before emergency event.
And I think Kenan or ERCOT's intention
would be to add will deploy to their RFP,
the ERS contracts into the technical documents.
And so, I wanna make sure we give that clarification now
to Kenan and ERCOT so that they can use
our desired approach in those three, I guess, documents.
-: Yep.
Well-put.
-: What's your name?
-: Kenan Ogelman with ERCOT,
We don't, I mean, we think that the proposed order,
or good cause exception would work,
but I did wanna clarify with y'all
how we would implement that.
Which would be that we would implement
deployment of ERS prior to EEA1
in order to not enter EEA1 hopefully.
That was my takeaway from what y'all had discussed.
Nothing in the proposed good cause exception
prohibits us from doing that.
But, as we work some protocol changes through,
I just wanted to make sure I read the room correctly.
And then there was one other point I did wanna make.
There was also discussion around in an increase in budget.
And I'm curious if there might need to be some way
to get the Commission's feedback
on how much that increase should be.
Because, if for example,
I were to increase the winter budget by 20 million,
but you only ultimately wanted to increase
the overall budget by five.
I would be shorting the summer and so forth.
And then the last point that Woody will beat me up
if I don't make this is, we can, I think,
get everything done in a pretty judicious manner
in terms of the RFP and issuing other binding documents.
But there is an operator training element to this
that we would also have to incorporate.
And that might take a little bit of time.
-: We can help you get that all laid out
and moving down the tracks as expeditiously as possible.
One high-level point of clarification I wanna make
is that I think that while the good cause exception
is the language is relatively broad,
in no way do I think are we intending to adjust
existing ERS contracts?
We're gonna honor the existing contracts.
-: That's correct.
-: They're in place.
This would be a going forward effort
for the new contracts for the next season of ERS.
So just want to clarify that we're not trying
to retrade contracts.
On your question of when it would be deployed
before EEA is like what you said,
I'd move that,
I welcome the comments from others.
I'd move that up even more
because I certainly don't want to be asking Texans
to turn down the lights in their homes
and businesses and throttle down their lives
before we've deployed the demand response
that's already been paid for.
That seems very straightforward to me, but...
-: Absolutely
-: To meet the non-negotiable policy
that the Commissioners,
has seemed to establish consensus on
is EEA needs to be deployed before EEA1.
-: ERS
-: I'm sorry.
ERS needs to be deployed before EEA1.
What did I just say?
I don't know, it's been a long day.
-: It's before the EEA.
-: No, before EEA1.
Thus with the stated objective of preventing
having to go into a conservation.
Now, should ERCOT be granted the flexibility to do that
and the MCL thing that which is kind of tied
is still kind of moving pending the studies.
So at this time I would suggest allowing them
the flexibility to deploy before EEA1
and use the technical and administrative
discretion to deploy that, and just give them guidance.
With the stated goal of do not go into conservation.
-: Sure, absolutely.
-: And that's what they're trying to solve for with ERS.
-: I'm happy to defer operational decision-making
to the operators on the ground,
but in no uncertain terms do I wanna hear
that we need to ask regular Texans to turn down their homes
and businesses before we fully deployed that resource.
Where are you, actually...
What number PRC is deployed, I'll leave it to y'all,
but I wanna make that clear.
We need to use the demand response load resources
we've already paid for before we start asking
25 million people to change the way they run
their daily lives.
Does that work?
-: Absolutely. -: Yes.
-: Absolutely.
And with respect to the amount,
the additional amount that we would add
to the winter contract period, if I may,
I would suggest that maybe ERCOT come back
to Commission staff with three options
and dollar figures that we can assess
and then work with ERCOT off line to determine
what is that right balance of additional money
we wanna add to the winter contract period
to try to get more resources and or pay for the resources
that we're gonna be asking to deploy a little bit earlier,
that might cost a little bit more money
and in balance with the rest of the contract periods
in 2022, especially the summer.
So I wanna strike that balance.
And I think if you can bring back at least three options
for staff to review, we can give you feedback offline
as to what that appropriate amount would be.
that appropriate amount would be.
-: Or perhaps we could include it in the conversation
for a work session next week.
next week.
-: Sure.
-: I believe we can meet that as well.
I think we can turn something around
-: By next Thursday, okay.
-: Yeah, sounds good.
Yea, sounds good.
-: All right, is there anything else,
any other questions you need answered from us?
-: No, I think I'm just wanted to...
I didn't wanna take you by surprise
when we were going to clearly in the RFP state
that it was gonna happen at a PRC level
in advance of the EEA1.
That was definitely what my takeaway was,
but just wanted to make that confirmed.
-: Absolutely.
And as always, we will continue to utilize all of the tools
available to us, including a conservation notice,
hopefully not,
but it's this standard reminder that we'll use
all tools available to us,
ERS being one that we would prefer to use
before conservation notice.
-: Understood.
-: One just question something to consider,
given the fact that ERCOT is gonna insert
that they will deploy ERS before EEA1
in their RFP contracts for the winter period
and technical documents.
Is it makes sense to modify our order
to change it from may to will.
-: I don't know that it makes a difference.
I'll defer to Commission council on...
-: So I take our order off of this motion
is simply waiving the requirement of the rule
that requires you to wait until EEA1 has been declared.
We're not giving you any further guidance,
-: We're removing a restriction not providing direction.
-: We are removing a restriction
and that's the good cause waiver that this motion is.
-: Which grants maximum flexibility.
-: Yes, the direction you just given to ERCOT they've heard
and it sounds like that's their intended plan
moving forward.
-: Okay, I just wanted to ask to see
if there was any appetite for doing that
and what the bounds were.
worked.
-: Commissioners, the language of staff's motion
includes the word may specifically
for the reason that you just discussed with Mr. Junae.
that you just discussed with Mr. Journey.
That we believe it would be your intention
and expert discretion regarding when exactly to employ.
exactly to employ.
So you're removing the, excuse me,
you're removing the restriction.
It works for me, works for y'all.
-: Yes. -: Great.
-: Yes.
In that case, the...
In that case, the..
-: I will move to grant the good cause exception.
-: Second. -: Second
-: Two seconds, outstanding.
(Laughing)
All in favor.
-: [Commissioners Together] Aye.
-: None opposed, the motion passes.
I don't have anything on item 25.
Do y'all?
-: No, but I did have something on 26, just a brief update.
Tiny brief update.
-: Lets go to 26 then.
(Laughing)
-: Oh, I'm sorry, did I do...
Did I jump around?
I'm sorry.
-: We're all down moving the train down the trucks.
-: Oh, I'm sorry.
Yes, I skipped a few.
Sorry.
Okay, so a few open meetings ago,
I brought up some MISO related matters,
and that was that MISO's currently looking
at long range transmission planning.
And in that analysis,
they are looking to have cost allocation,
separate cost allocation for MISO North Central
region and a MISO South region.
So the cost allocation they're looking at right now
is separate for the two pods, the two regions.
But recently MISO has stated
that there could be situations that would trigger
footprint wide transmission cost allocation
and with our Southeast Texas rate payers.
And introduce, (indistinct) Texas service territory,
or a tiny pod of that big MISO footprint.
So to use a phrase that Commissioner McAdams likes to use,
I started setting the table with MISO,
and letting them know that sending them the message
that Texas would be strongly opposed
to the use of a MISO footprint wide posted stamp
cost allocation for transmission.
Texas will not pay for transmission build
out in MISO North Central region,
if Texas rate payers do not receive a direct benefit
from that transmission build out.
And so I think it would be a very high hurdle.
And what I'm saying and what I mean by this
is that, as I said, you know,
very small swath of Texas is in MISO.
And if MISO ultimately decides
to integrate the entire footprint and use
one cost allocation methodology,
transmission, postage stamp costs allocation
as is currently done in ERCOT for the entire footprint,
that we're gonna have a high hurdle
for Texas rate payers in Southeast Texas
to be paying for transmission up north.
So I just started setting the table.
I know that some of our peer in the Southeast
have said even stronger words.
But, about...
-: There are other folks who aren't happy about it either.
-: Yes, like Louisiana and Mississippi.
And so, I just wanna start kind of laying,
I want, one, to notify y'all of kind of this issue
that came up and you might've seen it in SBP2 as well.
Commissioner McAdams,
but just to notify you and to let you know
that I'm being mindful of the Texas rate payers
in Southeast Texas at this time.
I'm taking them into consideration
and keeping them in mind is if MISO
starts moving in that direction.
-: Yeah.
And to echo Commissioner Cobos comments on MISO.
SBP has the issues faced in both regions are very similar.
The electoral dynamic on decision-making
is somewhat less volatile in terms of making a decision
on the topic.
It's more entrenched at the moment,
but it's certainly similar in terms of those Southern
more load sensitive states versus the resource states
in the Western regions.
-: I appreciate you bringing that to our attention
and certainly share your concern.
Please keep us updated as that develops.
And I suspect since we're talking
about Southeast Texas and another ISO,
I suspect Commissioner Glotfelty
has got a few thoughts on that.
-: Well, I appreciate the efforts in these other regions.
We still represent those Texans as well.
So I think it's important.
To that end again,
a few meetings ago when we discussed
a transitioned to competition payment for energy.
I had brought up that maybe we should have looked at,
if there's a need for competition down there,
we oughta hear from folks who want competition
down there.
So to that end,
I just want to announce that we've opened
a project number 52760 for interested stakeholders
to file comments based on the discussion
that we had October 7th
relating to competition and entered the service territory,
as well as all other non-ERCOT areas.
So we'll have that docket opened and--
-: Except for the far west.
-: Except for the far west, correct.
And we'll be able to get input
and help guide us as we look
to see if there's is something we need to do.
-: Commissioner, what was the thinking
on leaving out the far west on that?
What was the policy kind of a lining the sand on that?
-: Well, I would put them all in there the far west.
I dunno, Mr. Junae, what I agreed with you
pretty quickly, but I didn't really think about it.
-: I thought I was following directions, sir.
(laughing)
-: How about we say this?
How about we redo this?
In any of the regions
let's have folks file,
and if we end up getting many comments
into specific areas
we can bifurcate those into separate regions
and have separate proceedings on those.
But we could think about all of them.
So thank you for bringing that up.
-: Absolutely, sir.
And so just to recap your vision for this proceeding
is to simply act as a repository for public petition
and interest, and to make their interests known
that competition may be good for their region,
but with no preordained...
And again, just to clarify, we're not reinitiating
with the proceeding like any studies or again,
not another $200 million project to study integration
or anything like that.
-: To answer your question.
I think the chairman on October 7th said it right,
which is if you want it, we should hear from you.
And this is a method to hear from them.
-: And thank you for asking that question,
Commissioner McAdams.
That was gonna be my question
just in process, what the project was about.
Certainly we have four utilities in the edges of Texas
that are thriving and serving important customers
out there as well.
The only thing I wanna say that, you know,
and I think Commissioner McAdams'
kind of clarifying questions
might help alleviate those concerns out there
with respect to what is the goal of this project.
Are there any next steps?
So we have the non-ERCOT utilities that come in here
from time to time and file CCNs for generation plans
and other infrastructure.
I wanna be mindful and really stress.
This is an opportunity for stakeholders out there
to voice concerns.
But I also am mindful of the investment community
that may be hearing this,
that is putting up investment dollars for big plants
on the edges of Texas that are expensive.
And they may be thinking, "Well, goodness,
"is our investment gonna still hold
"with a regulated rate of return and these
"vertically integrated utilities?
"Or will these utilities ultimately be put in ERCOT?"
You know, it's survival of the fittest at that point.
And so that's the only sort of cautionary footnote
I wanna add on this is that, you know,
we wanna make sure that those areas
out in El Paso and Amarillo and, you know,
Texarkana and Beaumont,
that all those corners and rate payers
in those edges of Texas still get reliable service,
still get access to all the services and infrastructure
these companies are providing.
And I know that they're diligent
in making sure all that happens.
And I just don't want for us to send regulatory uncertainty,
shockwaves that ultimately get in the way of financing
some of these big infrastructure projects
as a result of this forum.
But that's just the only thing I wanted to add.
-: An important consideration.
And I'm sure Commissioner Glotfelty,
like the rest of us, will welcome commentary from them.
Those who are investing.
-: Absolutely.
-: I'm sure they won't be shy.
-: I'm sure they won't.
But I echo Commissioner Cobos' concerned there.
And just from my perspective
for that financial community out there
who invests in our non-ERCOT areas of Texas.
You still have a framework.
You still have a system to invest in
that provides reliable, essential service,
and that's gonna be there in the future regardless.
But again, that's why we capture this as a repository,
just for public petition,
in the interest of assessing the virtues of competition
in those unique areas of Texas.
And as I said before, and as you know, and we all do,
the legislature has spoken to this several times
over the past two decades
and they certainly have a voice here.
So before any letters start rolling in,
we respect that.
-: Well put.
All right.
That concludes business on item 26.
I don't have anything on 27.
That'll bring us to 28.
Commissioner Glotfelty filed a memo on this docket.
Would you lay that out for us?
-: I'm sorry, I'm talking so much today.
-: No, we're glad you--
-: I don't like talking this much.
-: We can put a three minute limit on you.
(laughing)
-: That would be great.
Steven.
I think again, on October 7th,
when Commissioner Cobos was talking about transmission,
one of the issues that I brought up
was the use of new technologies that are out there
and have been utilized across the system,
across the United States and across the world.
(beeping)
(laughing)
-: Three seconds or three minutes?
I'm sorry.
-: Thank you, Commissioner Glotfelty.
Well put.
-: Do I hear a motion?
These technologies dynamic line rating technologies
are proven in the market.
They're on many transmission lines around the state.
What they do is instead of a static writing
for a transmission line on throughput,
how many megawatts can go through a line?
They use components that are actually added to the system,
which measure temperature, wind speed,
other things that give a real-time value
for the amount of megawatts
that can be put through those lines.
I know Encore and others in Texas do use it
on some areas.
And other transmission owners around the state use it less.
And my point in this project is to really see,
is there more need for this?
Is there an opportunity to utilize this
as a lower-cost way to get more megawatts to load centers?
And it's not an expensive technology.
It is a proven technology.
So what I would suggest in the memo
is that we direct staff to open a new project
that deals with dynamic line writing,
specifically as that technology and that we direct
the TDUs in ERCOT to answer a series of questions
about their use, not only the positives,
but the negatives of these technologies as well.
I think we need to have a fair understanding
of if there are pros to this and if there are cons to this.
But it is a technology that's utilized across the U.S.
and across the world
and could have some value here in ERCOT.
-: A little more than three minutes.
But that's okay.
-: However, my three minutes.
-: Nicely put, certainly, if we know anything,
we know there's room for improvement in this realm
and an opportunity to enhance the resources we've got.
Certainly, support the notion of opening a project
and directing that segment of our stakeholders
to provide pros, cons,
and any more specific questions you'd want,
or any of us would wanna include.
-: Yeah, I would say that in my...
I've listed 10 questions,
but I would surely be open to other questions
that other Commissioners would have
if we want to add other things to that,
I'd be absolutely open to that.
-: Thoughts and comments.
-: Thank you for your leadership on this issue.
Commissioner Glotfelty.
I think your questions are very robust and holistic,
and I thought they were great questions.
So I don't have anything to add.
-: Yeah and on that Commissioner,
so given that this would be an enhancement
to our transmission systems.
Do you envision long-term and should a question
be posed in this direction that evaluates it?
Should there be a cost benefit?
And they do this already, a cost-benefit test
on those enhancements.
Again, what value do you add?
And for the system reliability,
what kind of transmission level threat mitigation
performances offset those costs?
-: I would be happy to add a question about how would you see
a cost-benefit analysis of this technology...
-: Being incorporated into your infrastructure analysis?
-: I think that would be great.
-: Okay, I'd like to add that.
-: Absolutely.
-: That sounds good to me.
-: Works for me.
Do you want to provide a timeline for those responses?
I'm just gonna get in front of this.
-: Why don't we just...
I mean, I think it should be...
I mean, is there a normal timeline?
60 days?
We've got a lot going on, so I don't wanna burden.
-: I mean, I was thinking of talking to Connie
about finding out how best to distribute these questions.
Who do we wanna target them to?
I'm not seeing necessarily an order here,
but maybe a bit more of like we did in workshops,
or just proposing questions to parties.
Typically that would be more of a 30 to 60 day timeline.
-: Yes, I agree.
And I think this discussion will go a long way
towards figuring out who might be
the best folks to respond to that.
Who would be the most interested?
-: And I think 60 days is fine.
You know, again, we've got really big fish to fry early
in November and December.
So this is a longer-term issue that I think we can
get to a better discussion launch next year.
So 60 days would be great.
-: All right, do you have everything you need?
Or I guess we've taken instruction from the dais
when we opened the project
and consider the guidance from the dais
of direction to our relevant stakeholders?
-: Correct.
-: And some further guidance about the question
on benefit costs.
-: Yeah, yeah (indistinct). -: Yes.
-: Okay.
Would you like to update your memo with that question?
Filed under this project?
-: There was another question.
If we open up a project number,
I would like this memo to be added to that project number.
Is it appropriate for me to...
Why don't I do that?
I'll update the memo
with Commissioner McAdam's question
and re-circulated it.
Do we have a docket number or a project number?
-: We need to look to see whether we got something
existent or we need to create another one.
And then if this is sort of like,
staff's gonna put out questions,
I don't know that you need to redo your memo.
We just need to perform the question.
-: Can you work with staff to figure out...
-: Absolutely.
-: The best way to move forward with this
and staff can update her individual offices separately?
-: Yes.
-: All right, there we go.
I don't have anything on 29, 30, 31.
Hearing no other topics on those items,
that brings us to agenda item number 32.
I think our executive director has an update.
-: Thank you, Mr. Chairman, Commissioners
for my two minutes today that I will take.
It's not three.
If you gave Commissioner Glotfelty three,
I'll just take two, thank you, chairman.
Chairman: I appreciate the self muzzling.
-: Absolutely.
Yeah, restraint, thank you.
Just a quick update on our continued work
with the railroad Commission and the oil and gas
and electric industries to ensure
that everyone is prepared for this upcoming winter.
At the request of Commissioner McAdams,
we held a meeting last Wednesday
up in the railroad Commission's offices
with more than 70 members, representatives
from the oil and gas industry,
as well as the electric industry, railroad Commission staff,
and our staff to lay out any issues that are still existing
going into this winter that remain needing to be addressed.
That meeting lasted roughly three hours.
We had a very robust discussion.
Coming out of that,
we have I'd say a handful of action items
that PUC staff sent to the railroad Commission.
I'm meeting with railroad Commission,
executive director Wei Wang tomorrow
to go over that action item list with the goal
of getting everything on that list completed by January one,
to ensure that we have done everything we can
to be prepared for this upcoming winter.
And once that action item list is finalized,
I've already talked to each of your chiefs of staff,
will come by and brief you on those action items.
-: Thank you, sir.
Will, I know you've been carrying a heavy load on this one.
It's hard to understate the importance of this issue
heading into winter.
-: Yes, sir.
I can affirm what Thomas briefed you on.
It was a robust discussion.
It was collaborative.
I would say that from the...
The takeaway perspective is that the analysis and evaluation
by our transmission service providers
for the upcoming winter is absolutely essential.
It is the guiding star by which both the Commission,
the public utility Commission
and railroad Commission's efforts
are fully underway and designed to address.
We're not there yet, but we're gonna get there.
And I appreciate Thomas and staff's work on this.
-: Thank you.
-: And I would just add that the most of the discussion
centered around different tiers of criticality
for different facilities, communication plans,
as well as language around force measure
and from fuel contracting.
-: All very, very important.
Thank you, Thomas.
-: And then the second item is some sad news
for those who haven't heard,
our communications director,
Andrew Barlow will be leaving us next Friday.
So I just wanted to publicly thank him for his service here,
especially during the winter storm and thereafter.
You know, we have a one-person communications team
and the amount of work that he had to do,
including the number of interviews he gave
to different media outlets during that the week
of Winter Storm Uri and after that,
was just incredible and we're gonna miss him.
And I wish him all the best.
I know everyone on staff does.
And it will be very difficult to replace him on staff.
-: Very, very sorry to see you go.
We wish you all the best in your future endeavors.
And to echo Thomas's sentiment,
it's incredible how much energy, talent,
and fun can fit into a one-person communications team.
-: And if you can find the interview of hidden
giving us an interview in Spanish, it's gold.
-: Is that one of the auction items for us?
(laughter)
-: We may have to augment and add that after he leaves.
-: Yeah.
Certainly bid on that.
We'll miss you Barlow.
-: Thank you.
-: We sure are, yeah.
I mean, I'll never forget joining this Commission
almost of six months ago and spent a long six months.
But Andrew was what was living this before that.
And I think we're gonna get together years from now.
It's like this PUC reunion about everybody
who either lived through that event or came in afterwards.
And Andrew, you're sure gonna be welcomed.
And you did good service for the state.
Thanks for everything you did.
-: Thank you, Andrew, for your service.
-: You barely even know him, you just got here.
-: He took my picture though and it's on the website.
So, thank you.
-: That was a good one.
-: Oh yes, before you leave, your last assignment
is to put our pictures on the wall.
-: Oh yeah.
-: All right, that brings us to agenda item number 33.
I know Ms. Corona has a few comments
on customer service.
-: Thank you, Commissioners.
I know it's been a long day,
but this is a very important topic that I wanna be sure
to bring to your attention.
I'd like to give you an update on customer complaints.
As you might imagine, our complaint investigation workload
since winter storm Uri is heavier than it's been
in quite some time.
As a point of reference, we passed our 2020
total complaint number in August.
We have a relatively small team of staff members
that investigate and respond to each and every one
of those complaints and that small team
is doing a fantastic job.
However, we do need some help from our regulated community
so that our investigators can work as efficiently
as possible to help those customers.
In serving the investigators,
we found several opportunities for improvement,
and we found a couple gold stars.
So when the regulated community
is responding to customer complaints
filed as a Commission, there are a few things
that make a timely resolution for the customer
particularly challenging.
I'd like to give you and the folks in the audience
and online some examples.
The top three challenges for our investigators
were late responses, late responses
and late responses.
Please, please respond on time.
The investigators waiting, the customers' waiting.
That one is followed up pretty quickly
by not responding at all.
And that will earn you a visit from Mr. English,
our director of enforcement.
Not a personal visit, but an email.
Chairman: He'll do real games, I'm sure.
-: A couple of other things though were of note,
missing or incomplete documentation.
So this includes when improvisor
sends us a generic template of correspondence
that says, "Dear blank, here's what's happening
"with your account."
Now we want to see dear Mr. Gleason
and the exact letter that the customer received.
The generic template out of your files
is not helpful in the investigation.
Responding to only one issue
when the customer actually sites
multiple problems with their account.
We'd like to get all of the issues rounded up
and dealt with in one fell swoop.
Here's something that you might not realize
is a problem, but is with the way we process complaints,
responding in the body of an email
instead of an attachment that automatically is fed
into our database causes problems and delays for us.
Staff has to go pull that out of an email,
put it in a document and then load it to the database.
It's just extra step for them.
And then the final one that causes us problems
is when a provider gives our investigator
general company contact information
like a 1800 number, rather than providing
a specific point of contact for our investigator
to follow up with on a given complaint.
So these problems are not specific
to any particular industry, but apply across the board.
I would say in general that the large providers
do a good job.
Many smaller companies that don't often have
the occasion to interact with the Commission
have more difficulties.
They just need more practice.
For that, I'd recommend that the associations
that represent these smaller providers
reach out to them periodically
with reminders of best practices.
I'd like to wrap up though with some good news
and share a couple of tips for excellent responses.
First, reaching out to the customer promptly
after a complaint is received is a great way to start.
And secondly, when responding to our investigators,
the best responses address the issue or issues
raised by the customer and also provide
additional context about the customer's account
so that the investigator can understand
the full resolution and see it
from the customer's perspective,
everything that's happening with their account.
So thank you for your time.
We will be reaching out to the regulated community
and providing them with some of these tips,
but I wanted to bring you all up-to-date as well.
-: Thank you, Connie.
I think it goes without saying that you and our staff
have the full support of this Commission.
A number of the failures that you mentioned
are I think would categorize a good chunk of those
as completely unacceptable,
and a few of those as dramatically need improvement,
but the emphasis on completely unacceptable
is not something that I think any of us wanna tolerate.
Thank you for the update.
-: Yeah and Connie, I think it's safe to say
from all of our perspectives, the competitive system
is predicated upon our retail community
and our market participants doing the right thing
as a default setting.
So all of the stipulations you laid out
in terms of our complaint resolution system,
that's predicated around them doing the right thing
and complying in the right way.
So this Commission is dedicated
to keeping the competitive marketplace healthy,
but that means our marketplace
has to do the right thing
and serve the consumer as well.
So please know that you have our full support.
-: Thank you for support Commissioners.
And if any member of the regulated community
has a question about how to respond
or the best way to respond to a complaint,
they can reach out to their assigned investigator
or directly to our customer protection director,
Chris Burch.
-: Thank you for this update, Connie.
And I just wanna echo the chairman's comments
and Commissioner McAdams' comments.
It is critically important for these companies
to serve the customers and to be responsive.
These customers are waiting to resolve their issues.
And it's unacceptable that they're just kind of left
to wonder when their complaints and resolutions
and investigations will come to completion.
So like my Commissioner McAdams has just said,
we want a healthy, competitive retail electricity market.
But a good component of that
is to ensure effective service for the consumers.
Thank you.
-: Well put.
All right, that brings us to item 34.
I don't have anything on this item.
Mr. Glotfelty, any thoughts?
-: Just one more thing, sorry y'all.
-: Three minutes.
-: No, less than that.
This deals with cybersecurity,
obviously it's issue that every utility is dealing with,
every generator, every participant ERCOT deals with.
I just wanted to make the reminder or the encouragement
that NERC is having one of their major cybersecurity events
that's coming up called GridEx.
It's November 16th and 17th.
It is a distributed play exercise.
And I think it is valuable for all of our utilities
to participate in as many exercises as they can.
And that the more we learn about these,
not only cyber attacks, but physical attacks,
we will be prepared if something, God forbid,
ever does happen to the ERCOT system.
So I just wanna bring this up
that we encourage everybody to participate
if they can.
-: Absolutely, I'll second that.
Cyber security is something
that is an ever expanding threat
that requires constant diligence.
Thank you for highlighting that for us.
All right, it's 3:09 p.m.
There being no further business to come
before the Commission,
this meeting of the Public Utility Commission of Texas
is hereby adjourned.