WEBVTT 00:00:06.490 --> 00:00:11.859 (item:1:Opening Comments by Chairman Peter Lake) afternoon, glad to see everyone here both here in person 00:00:11.859 --> 00:00:16.539 and joining by phone. As you know, we're here to provide 00:00:16.539 --> 00:00:20.989 an update on grid conditions going into this winter 00:00:21.000 --> 00:00:25.480 Recently, ERCOT released its winter Sarah report. Our 00:00:25.480 --> 00:00:29.260 new Ceo Pablo will discuss the details of that here 00:00:29.260 --> 00:00:34.700 in a minute. But out of the gates, I wanna remind folks 00:00:34.700 --> 00:00:37.649 about all of the reforms that we have put in place 00:00:37.659 --> 00:00:41.880 especially ahead of last winter when we rapidly put 00:00:41.880 --> 00:00:46.130 in new rules to require generators to weatherize. Uh 00:00:46.140 --> 00:00:50.270 we follow that by inspections of generators across 00:00:50.270 --> 00:00:54.119 the archive grid. In addition, we've built out and 00:00:54.119 --> 00:00:59.939 mapped a critical supply chain and critical infrastructure 00:00:59.950 --> 00:01:03.539 network to make sure that the natural gas supply chain 00:01:03.539 --> 00:01:07.420 stays online at all times and ensures the gas continues 00:01:07.420 --> 00:01:12.290 to flow to our generators and most importantly, we 00:01:12.290 --> 00:01:15.890 have dramatically increased and improved communication 00:01:15.890 --> 00:01:20.480 between the Railroad commission text dot t d M T C 00:01:20.480 --> 00:01:25.450 A Q. PUC and archive and we saw the benefits of that 00:01:25.459 --> 00:01:28.510 improved coordination and communication last winter 00:01:28.519 --> 00:01:32.349 at the state operations center when turk worked hand 00:01:32.349 --> 00:01:36.379 in hand across agencies across industries to ensure 00:01:36.390 --> 00:01:42.629 that during the winter blast of february, we had adequate 00:01:42.629 --> 00:01:45.280 gas, we had generators that were online when we needed 00:01:45.280 --> 00:01:48.120 them to be online. Text dot was on standby to make 00:01:48.120 --> 00:01:52.230 sure that roads were cleared to ensure reliable power 00:01:52.230 --> 00:01:56.930 throughout the winter going into this winter, we're 00:01:56.930 --> 00:02:01.420 even better prepared. We've put even stricter weatherization 00:02:01.420 --> 00:02:06.590 standards in place this fall are ERCOT will continue 00:02:06.599 --> 00:02:10.490 to inspect and increase its inspections of generators 00:02:11.599 --> 00:02:15.150 and importantly for the first time ever. ERCOT has 00:02:15.150 --> 00:02:20.270 developed and implemented a new firm fuel product That 00:02:20.270 --> 00:02:25.030 guarantees that we have 3000, almost 3000 MW of firm-fuel 00:02:25.030 --> 00:02:28.879 supplies to bolster and enhance our grid going into 00:02:28.879 --> 00:02:33.050 this winter. We're better prepared than ever and at 00:02:33.050 --> 00:02:35.659 (item:1:Comments on SARA by ERCOT CEO Pablo Vegas) this point I'll hand it over to Pablo to discuss the 00:02:35.659 --> 00:02:39.360 SARA. Thank you Peter and good afternoon everybody 00:02:40.009 --> 00:02:42.460 So I'd like just like to reiterate a key point here 00:02:42.460 --> 00:02:45.169 because of the changes that have been initiated by 00:02:45.169 --> 00:02:47.379 the legislature and the administration and because 00:02:47.379 --> 00:02:51.060 of the actions taken by the PUC T and ERCOT over the 00:02:51.060 --> 00:02:54.099 last year and a half, we are in a position where the 00:02:54.099 --> 00:02:56.800 elements that are within our control related to the 00:02:56.800 --> 00:02:59.330 reliability and the operation of the grid are as strong 00:02:59.330 --> 00:03:02.060 as they've ever been going into this winter season 00:03:02.069 --> 00:03:05.030 And the chairman has mentioned many of those items 00:03:05.030 --> 00:03:07.810 and I'll add to that the scheduling of outages and 00:03:07.810 --> 00:03:09.469 the maintenance periods that we talked about a little 00:03:09.469 --> 00:03:12.469 bit a couple of months ago. Those continue to help 00:03:12.469 --> 00:03:15.330 to ensure that we get the required maintenance on generators 00:03:15.330 --> 00:03:17.039 so that we'll have reliable service throughout this 00:03:17.039 --> 00:03:20.699 winter. We've also implemented some new Ancillary services 00:03:20.699 --> 00:03:23.949 a fast frequency response service that helps to ensure 00:03:23.949 --> 00:03:27.169 reliability and during operating conditions that change 00:03:27.169 --> 00:03:30.280 rapidly. And so when we look at the Sarah report for 00:03:30.280 --> 00:03:32.669 this winter, there's really a lot of similarities in 00:03:32.669 --> 00:03:35.210 the, in the big picture as to what we saw in last 00:03:35.210 --> 00:03:38.449 winter, Sarah report for all of the expected scenarios 00:03:38.460 --> 00:03:41.620 we expect to have adequate supply to meet the needs 00:03:41.629 --> 00:03:44.879 of the grid. And so that continues to be the same situation 00:03:44.889 --> 00:03:47.590 this year as we saw last year. And for the majority 00:03:47.590 --> 00:03:51.159 of the scenarios that are in the more extreme uh condition 00:03:51.169 --> 00:03:54.550 scenarios, we still see adequate supply to meet the 00:03:54.550 --> 00:03:58.430 reliable operation requirements of the grid. The key 00:03:58.430 --> 00:04:01.120 changes between last year's and this year that I would 00:04:01.120 --> 00:04:03.879 call your attention to one of the more significant 00:04:03.879 --> 00:04:07.150 ones. As we see demand having grown, we see demand 00:04:07.150 --> 00:04:11.090 upwards of about five gigawatts of 5000 megawatts more 00:04:11.090 --> 00:04:14.659 than we saw in last year Sarah report and that's a 00:04:14.659 --> 00:04:18.060 result of the incredible growth that Texas is experiencing 00:04:18.069 --> 00:04:21.779 Texas is adding a city the size of corpus Christi every 00:04:21.779 --> 00:04:25.350 single year in population and the associated economic 00:04:25.350 --> 00:04:28.370 growth that comes with that is driving increased usage 00:04:28.379 --> 00:04:30.649 on the grid. And so we see that reflected in the Sarah 00:04:30.649 --> 00:04:35.100 report, we for the first time, I have included battery 00:04:35.100 --> 00:04:38.389 storage as an element of resource that can help to 00:04:38.389 --> 00:04:41.920 provide reliable service during the winter. We saw 00:04:41.920 --> 00:04:44.079 the performance of batteries over the course of this 00:04:44.079 --> 00:04:47.629 last year. So we included a modest amount of batteries 00:04:47.639 --> 00:04:50.589 in the serra resource list that reflected what the 00:04:50.589 --> 00:04:53.329 kind of performance we saw during some very extreme 00:04:53.329 --> 00:04:55.699 weather events over the course of this last year. So 00:04:55.699 --> 00:04:57.899 just under a giggle Water battery storage is included 00:04:57.899 --> 00:05:01.220 on the supply side and then fundamentally the thermal 00:05:01.220 --> 00:05:04.990 resources, thermal generators are relatively flat from 00:05:04.990 --> 00:05:07.319 last year. So in spite of the increased growth on the 00:05:07.319 --> 00:05:10.589 demand side, we're seeing fairly flat amounts on the 00:05:10.589 --> 00:05:13.160 thermal generators. So that takes to the point where 00:05:13.160 --> 00:05:15.779 the elements that are outside of our control, which 00:05:15.779 --> 00:05:19.420 is what generation supplies get built and when those 00:05:19.420 --> 00:05:22.899 elements as well as how fast demand grows in the state 00:05:22.910 --> 00:05:26.149 those elements also outside of our control, those have 00:05:26.160 --> 00:05:29.439 a pretty significant potential impact on the reliability 00:05:29.439 --> 00:05:32.459 of the grid, which is why it's so critically important 00:05:32.470 --> 00:05:34.670 that the work that we are pivoting to right now, which 00:05:34.670 --> 00:05:38.410 is to ensure that the Phase two market redesign work 00:05:38.420 --> 00:05:41.810 proceeds rapidly and clearly with an understanding 00:05:41.810 --> 00:05:43.990 of everyone in the market and all the stakeholders 00:05:44.000 --> 00:05:47.089 that that becomes our focus going forward to mitigate 00:05:47.089 --> 00:05:50.209 the risks that exist in those most extreme of scenarios 00:05:50.220 --> 00:05:52.420 which the CIA report currently shows is one of those 00:05:52.420 --> 00:05:55.079 scenarios that could occur. And so we really want to 00:05:55.079 --> 00:05:57.670 focus on making sure that we get that work proceeding 00:05:57.670 --> 00:06:00.389 quickly and uh and address the benefits from there 00:06:00.389 --> 00:06:02.889 But let me be clear that the actions that we've taken 00:06:02.889 --> 00:06:06.699 over this last year and a half position us as best 00:06:06.699 --> 00:06:09.350 as we have been to operate the grid reliably and we 00:06:09.350 --> 00:06:11.610 expect through the forecast and the likely scenarios 00:06:11.610 --> 00:06:13.680 that we'll see over the course of this winter to be 00:06:13.680 --> 00:06:15.660 able to have enough supply to meet the reliability 00:06:15.660 --> 00:06:21.569 needs across the grid. (item:1:Additional Comments from Chairman Peter Lake) Thank you Pablo as always, we'll 00:06:21.569 --> 00:06:25.879 continue to operate the grid and the most reliable 00:06:25.889 --> 00:06:28.800 manner possible. We will continue reliable operations 00:06:28.800 --> 00:06:32.189 by having an expanded margin of safety with more reserves 00:06:32.199 --> 00:06:35.759 and we continue to bring more generators online sooner 00:06:35.759 --> 00:06:39.910 rather than later In the past 18 months because we've 00:06:39.910 --> 00:06:42.709 had these reforms in place, we have avoided emergency 00:06:42.709 --> 00:06:45.879 conditions or blackouts eight times we know the reforms 00:06:45.879 --> 00:06:48.250 are working, we've seen the results and we're gonna 00:06:48.250 --> 00:06:51.500 continue with those reforms and those and continue 00:06:51.500 --> 00:06:55.769 those reliable operations. As Pablo said, we have always 00:06:55.769 --> 00:06:59.819 known that we need a long-term solution because we 00:06:59.819 --> 00:07:02.500 have more and more people and the same amount of reliable 00:07:02.500 --> 00:07:08.079 dispatchable generation And that's why we're so focused 00:07:08.089 --> 00:07:12.579 on continuing with the Phase two market redesign. Thank 00:07:12.579 --> 00:07:15.660 you. Happy to take some questions. Yes ma'am. (item:2:Erin Douglas, Texas Tribune) 00:07:18.680 --> 00:07:22.959 So there's still one emergency scenario that indicates 00:07:22.959 --> 00:07:26.709 a risk of load shedding under the extreme scenarios 00:07:26.720 --> 00:07:33.170 can you say what planning to do to address uh, that 00:07:33.170 --> 00:07:36.870 particular shortfall. So really the majority of the 00:07:36.870 --> 00:07:38.740 actions that we've taken over the course of this year 00:07:38.740 --> 00:07:41.350 and a half are designed specifically to address any 00:07:41.350 --> 00:07:44.329 risk of Load shed the most impactful of those being 00:07:44.339 --> 00:07:47.319 the weatherization work that's taking place. So a lot 00:07:47.319 --> 00:07:49.269 of the issues that we've talked about over the last 00:07:49.269 --> 00:07:51.449 year and a half about what happened during your E was 00:07:51.449 --> 00:07:54.100 the unavailability of expected resources to provide 00:07:54.100 --> 00:07:56.779 generation during that storm. The weatherization work 00:07:56.779 --> 00:07:59.550 that's going on was done successfully over the course 00:07:59.550 --> 00:08:03.569 of last winter. We expected over 450 generating units 00:08:03.579 --> 00:08:06.230 since that time and are continuing to inspect units 00:08:06.230 --> 00:08:08.709 over the course of this winter, those inspections and 00:08:08.709 --> 00:08:11.100 audits are showing that the work is getting done to 00:08:11.100 --> 00:08:13.430 keep those generators operating during the most extreme 00:08:13.430 --> 00:08:15.470 weather conditions. So we really think that that's 00:08:15.470 --> 00:08:17.810 gonna have the most significant impact to mitigate 00:08:17.819 --> 00:08:20.829 the potential for any kind of a load shed event. So 00:08:20.829 --> 00:08:23.970 that coupled with having the firm fuel supply making 00:08:23.970 --> 00:08:25.660 sure their generators have been able to take their 00:08:25.660 --> 00:08:27.970 maintenance and a sequenced way that don't create new 00:08:27.970 --> 00:08:30.910 risk. And of course the reliable operations that we've 00:08:30.910 --> 00:08:33.779 been operating under on a day to day, week to week 00:08:33.789 --> 00:08:36.539 basis and sharing that before the grid gets too close 00:08:36.549 --> 00:08:39.279 to any kind of a reliability issue that we would bring 00:08:39.279 --> 00:08:42.860 online supplemental resources to help support grid 00:08:42.860 --> 00:08:45.279 reliability. Those actions are things that we're going 00:08:45.279 --> 00:08:47.799 to continue to do to ensure that we don't get into 00:08:47.799 --> 00:08:51.870 a scenario where there could be low chat in the and 00:08:51.879 --> 00:08:54.379 quick follow up to that. How many inspections of those 00:08:54.379 --> 00:08:58.230 generating units are still outstanding. So we are scheduled 00:08:58.230 --> 00:09:01.399 to do for the PUC t rule about one third of the 00:09:01.399 --> 00:09:06.190 generators each year. So we will do a little over 350 00:09:06.190 --> 00:09:08.620 or so roughly each year as part of that inspection 00:09:08.620 --> 00:09:12.960 cycle. So we just launched that cycle a couple of weeks 00:09:12.960 --> 00:09:15.399 ago going into and we start doing, we do a good majority 00:09:15.399 --> 00:09:18.259 of those in december and then we'll wrap up with those 00:09:18.259 --> 00:09:20.279 in the earliest part of next year. We plan to get most 00:09:20.279 --> 00:09:22.269 of those done in the next, in the next 4 to 6 00:09:22.269 --> 00:09:22.759 weeks. (item:2:Question:why is the Reserve Margin lower this year compared to last year?) 00:09:30.220 --> 00:09:31.409 Um so 00:09:33.090 --> 00:09:35.350 I'm looking at it, forgive me if I'm misunderstanding 00:09:35.350 --> 00:09:38.159 this, but it looks like the reserve margin is about 00:09:38.159 --> 00:09:43.370 like 19,800 ISH 893 or something like that. 00:09:45.470 --> 00:09:48.870 This is just overall um this is the number that you 00:09:48.870 --> 00:09:51.399 are impairing, I guess this is a question for your 00:09:51.409 --> 00:09:57.009 cut. Um it looks like the reserve margin is less than 00:09:57.009 --> 00:10:00.259 the reserve margin from last year, which was about 00:10:02.159 --> 00:10:06.950 8 22,060. can you Yeah, like why our reserve margin 00:10:06.960 --> 00:10:12.179 is less when you're saying that this winter? Yeah, 00:10:12.190 --> 00:10:15.100 it actually highlights exactly what really is probably 00:10:15.100 --> 00:10:17.759 the most important issue to focus on today, which is 00:10:17.759 --> 00:10:21.620 how do we sustainably create a market redesign that 00:10:21.620 --> 00:10:24.200 is going to deliver the kind of reliability at the 00:10:24.200 --> 00:10:27.149 kind of cost profile that we all expect. So what's 00:10:27.149 --> 00:10:29.879 happening with this shrinking reserve margin is year 00:10:29.879 --> 00:10:32.889 to year. We are developing more generation resources 00:10:32.899 --> 00:10:35.669 The majority the majority of those resources are being 00:10:35.669 --> 00:10:39.529 added to the ERCOT grid tend to be renewable resources 00:10:39.539 --> 00:10:43.529 like solar and wind. Solar being the largest portion 00:10:43.529 --> 00:10:48.184 of that coming online during the winter. Solar capacity 00:10:48.195 --> 00:10:50.544 doesn't have the ability to deliver to the degree that 00:10:50.544 --> 00:10:52.764 it can in the summer because of the nature of the weather 00:10:52.764 --> 00:10:56.674 and the sun performance. So the amount that gets added 00:10:56.674 --> 00:10:58.835 to the grid is not proportional to the amount that 00:10:58.835 --> 00:11:02.965 gets planned in terms of expected generation supply 00:11:02.965 --> 00:11:05.784 available. So that's one reason why. So the big majority 00:11:05.784 --> 00:11:08.105 of the resources being added or solar, you don't get 00:11:08.105 --> 00:11:11.394 the same value for solar in the winter. However the 00:11:11.394 --> 00:11:14.940 demand is growing a city the size of corpus Christi 00:11:14.950 --> 00:11:17.629 every single year. Economy is growing, businesses are 00:11:17.629 --> 00:11:21.000 growing here which is fantastic but it does create 00:11:21.009 --> 00:11:25.360 more demand on the grid and so that growth and demand 00:11:25.370 --> 00:11:28.340 with not having the same amount of growth of dispatchable 00:11:28.340 --> 00:11:30.889 generation. So that's a generation with an on off switch 00:11:30.899 --> 00:11:33.090 generation that you can call on whenever you need it 00:11:33.090 --> 00:11:35.419 regardless of what the weather conditions are. We're 00:11:35.419 --> 00:11:37.429 not seeing the same amount of growth and that kind 00:11:37.429 --> 00:11:40.480 of generation as we are in renewables. That's the reason 00:11:40.480 --> 00:11:43.009 why that reserve margin is shrinking. That's the reason 00:11:43.009 --> 00:11:45.259 why this phase to market redesign is so critical to 00:11:45.259 --> 00:11:47.899 focus on and to get across the finish line 00:11:51.509 --> 00:11:52.600 anyone else in the room. 00:11:54.200 --> 00:11:58.039 Uh we can go to the phones um moderator, are you there 00:12:00.259 --> 00:12:03.230 Yes I am. If you'd like to ask a question on the 00:12:03.240 --> 00:12:06.039 phone, please press one and zero on your touch tone 00:12:06.039 --> 00:12:08.720 phone, you'll hear an acknowledgement that you've been 00:12:08.730 --> 00:12:11.590 placed into Q. And you can remove yourself from Q. 00:12:11.590 --> 00:12:14.590 At any time by repeating the 10 command. If you're 00:12:14.590 --> 00:12:16.720 on the speakerphone please pick up your handset before 00:12:16.720 --> 00:12:20.480 pressing the numbers once again for any questions please 00:12:20.480 --> 00:12:24.059 press one and then zero at this time. One moment please 00:12:24.070 --> 00:12:26.990 for the first question and let them know to identify 00:12:26.990 --> 00:12:30.169 themselves in the organization they represent. Yes 00:12:30.179 --> 00:12:33.700 thank you. One moment we do have a few people queuing 00:12:33.700 --> 00:12:34.100 up 00:12:37.480 --> 00:12:39.860 and our first question will come from the line of bob 00:12:39.860 --> 00:12:44.259 Seckler, please announce your affiliation. (item:2:Bob Sechler, Austin-American Statesman) Alright 00:12:44.269 --> 00:12:48.710 I'm with the austin american statesman uh Mr lake. 00:12:48.720 --> 00:12:51.330 You know you've expressed a lot of confidence in the 00:12:51.340 --> 00:12:55.370 past that there would not be uh you know, a forced 00:12:55.379 --> 00:12:59.899 power outages and I'm just curious can you, are you 00:12:59.909 --> 00:13:02.889 um as confident for this one or that there will not 00:13:02.899 --> 00:13:06.679 be absolutely I expect that we're going to continue 00:13:06.690 --> 00:13:11.269 to do what we've done the last summer, the last winter 00:13:11.269 --> 00:13:14.029 and the summer before that we've kept the lights on 00:13:14.039 --> 00:13:16.299 in the summer immediately following Uri. We kept the 00:13:16.299 --> 00:13:19.799 lights on last winter in the face of several winter 00:13:19.799 --> 00:13:23.450 blasts and most importantly This summer we kept the 00:13:23.450 --> 00:13:27.279 lights on in a record setting summer. The hottest summer 00:13:27.279 --> 00:13:31.669 in Texas uh in recent memory if not ever. Where are 00:13:31.669 --> 00:13:36.370 ERCOT set dozens and dozens of daily weekly seasonal 00:13:36.370 --> 00:13:41.659 records and 10 plus all time records. Uh, so yes, we 00:13:41.659 --> 00:13:45.179 we know that the reforms are working, we know that 00:13:45.179 --> 00:13:49.110 these changes have had an impact and improve reliability 00:13:49.120 --> 00:13:51.049 We expect they'll continue to do so. 00:13:53.509 --> 00:13:56.740 So even though that one scenario is in there that could 00:13:56.740 --> 00:14:00.830 have power outages, you think people should sort of 00:14:00.830 --> 00:14:03.929 discount that and still be confident that there won't 00:14:03.940 --> 00:14:07.409 be any. I mean that's in there, but you don't think 00:14:07.409 --> 00:14:11.500 it's gonna happen. Remember these these this analysis 00:14:11.500 --> 00:14:15.590 is arithmetic considering various different scenarios 00:14:15.590 --> 00:14:20.019 We always will use every tool available. Uh including 00:14:20.019 --> 00:14:25.149 calls for conservation. In addition, the basic arithmetic 00:14:25.149 --> 00:14:28.389 of adding subtracting numbers doesn't account for the 00:14:28.389 --> 00:14:30.899 many reforms we've put in place like better coordination 00:14:30.899 --> 00:14:33.789 and communication with the Railroad Commission text 00:14:33.789 --> 00:14:37.279 dot TC Q to make sure that roads are open to get 00:14:37.289 --> 00:14:42.509 fuel supplies and workers to generation to better coordination 00:14:42.509 --> 00:14:46.169 on the natural gas supply chain to make sure that the 00:14:46.169 --> 00:14:49.679 key parts of that supply chain are online always. So 00:14:49.679 --> 00:14:53.700 that disruptions in the natural gas system don't lead 00:14:53.710 --> 00:14:56.960 to the outages that are contemplated in in that scenario 00:14:56.970 --> 00:15:02.700 Uh So while the arithmetic is a good exercise and examining 00:15:02.700 --> 00:15:06.080 various scenarios, it doesn't take into account the 00:15:06.080 --> 00:15:09.929 comprehensive reforms we've put in place that will 00:15:09.940 --> 00:15:12.230 make sure that this grid stays reliable 00:15:14.289 --> 00:15:17.559 and the lights will stay on. Absolutely expect the 00:15:17.559 --> 00:15:18.470 lights to stay on 00:15:20.120 --> 00:15:22.059 and I think to add to add to that, I think it's 00:15:22.059 --> 00:15:25.370 an important point that that that scenario is a call 00:15:25.370 --> 00:15:28.440 out for the importance of making meaningful change 00:15:28.450 --> 00:15:31.000 through this next phase in the market redesign. And 00:15:31.000 --> 00:15:33.879 that's that's why I keep coming back to that, because 00:15:33.889 --> 00:15:37.000 while this risk continues to persist and the risk could 00:15:37.000 --> 00:15:40.700 continue to grow over time if we did nothing, I know 00:15:40.700 --> 00:15:42.960 that we're not going to do that. So we need to, we 00:15:42.960 --> 00:15:45.909 need to drive towards that change aggressively and 00:15:45.909 --> 00:15:48.840 with focus and clarity and support across the board 00:15:48.840 --> 00:15:51.259 so that we can make the kinds of changes so that everyone 00:15:51.259 --> 00:15:53.919 can continue to feel confident that the grid will be 00:15:53.919 --> 00:15:55.909 reliable and support their needs regardless of the 00:15:55.909 --> 00:15:56.669 weather. Outside. 00:16:00.000 --> 00:16:04.370 Thank you, we'll go next to the line of on my mat 00:16:05.860 --> 00:16:11.049 of moe's book, please, Bushell, excuse me, please announce 00:16:11.049 --> 00:16:16.610 your affiliation Hey, this is moses kut 90.5. Um, I 00:16:16.610 --> 00:16:19.429 I guess my first question is looking at the three different 00:16:19.429 --> 00:16:25.889 scenarios in the extreme risk scenarios. Um yeah, it 00:16:25.889 --> 00:16:28.419 seems to me that the most extreme, there's like a column 00:16:28.419 --> 00:16:30.889 may be, I'm curious why you don't include a column 00:16:30.889 --> 00:16:37.000 1/4 column to look at extreme uh peak Load extreme 00:16:37.000 --> 00:16:41.210 unplanned outages and extreme wind out, low wind wind 00:16:41.210 --> 00:16:43.639 output. That's to say you look at high peak load, but 00:16:43.639 --> 00:16:46.210 there's no extreme peak Load coupled with the other 00:16:46.220 --> 00:16:49.220 kind of worst case scenarios. Why is that missing from 00:16:49.220 --> 00:16:54.269 the report at some point, you can consider an infinite 00:16:54.279 --> 00:16:58.480 combination of scenarios, but at some point the productivity 00:16:58.480 --> 00:17:02.000 of considering those runs out the column the furthest 00:17:02.000 --> 00:17:05.269 of the rights you're looking at their considers 77,000 00:17:05.269 --> 00:17:10.420 megawatts over 77,000 megawatts of demand. And that's 00:17:10.430 --> 00:17:13.269 what we that's what the demand was expected to be during 00:17:13.269 --> 00:17:19.319 your e so I mean these these are robust scenarios at 00:17:19.329 --> 00:17:23.059 take into account extreme circumstances, but there's 00:17:23.069 --> 00:17:29.039 there's limited usefulness in infinite speculation 00:17:30.480 --> 00:17:32.599 I'm also just kind of curious if this is just kind 00:17:32.599 --> 00:17:35.240 of a question of style, but last year we heard a lot 00:17:35.240 --> 00:17:37.960 about a conservative approach towards grid management 00:17:37.970 --> 00:17:42.390 Um you seem to have dropped that that terminology for 00:17:42.390 --> 00:17:44.539 the approach to in favor of aggressive approach, a 00:17:44.539 --> 00:17:47.700 reliable approach. Does this still, is there some reason 00:17:47.700 --> 00:17:51.190 to stop using the term conservative to to refer to 00:17:51.190 --> 00:17:53.460 the management technique here or is that still, you 00:17:53.460 --> 00:17:56.400 know, the word that you would choose? It's the same 00:17:56.400 --> 00:17:59.299 technique and and and really the shift in the, in the 00:17:59.299 --> 00:18:01.190 word is to try to be more clear about what it is 00:18:01.190 --> 00:18:03.650 we're doing and it's we're making sure that we put 00:18:03.650 --> 00:18:06.329 reliability at the forefront of everything that we 00:18:06.329 --> 00:18:08.099 do and how we operate the grid and that's the main 00:18:08.099 --> 00:18:10.730 reason because conservative could be misconstrued to 00:18:10.730 --> 00:18:13.690 be mean some other driver of why we're doing it, whereas 00:18:13.690 --> 00:18:16.609 reliable operations is is really the focus and but 00:18:16.609 --> 00:18:18.680 it's the same actions and it's the same practices. 00:18:20.099 --> 00:18:20.730 Thank you, 00:18:23.109 --> 00:18:26.069 thank you. (item:2:Jeremy Rogalski, KHOU-TV Houston) And our next question will come from the 00:18:26.069 --> 00:18:30.839 line of jeremy Rogalski, please announce your affiliation 00:18:31.809 --> 00:18:35.400 gentlemen, Good afternoon with kutV CVS in Houston 00:18:35.400 --> 00:18:39.779 This is from mr Vegas. Uh, on page four of the report 00:18:39.779 --> 00:18:43.799 with the three extreme risk scenarios, would you identify 00:18:43.799 --> 00:18:48.680 the third column as a winter storm Uri scenario? 00:18:51.680 --> 00:18:54.710 It would look, so the third column where we have the 00:18:54.720 --> 00:18:57.319 uh, the high peak load and extreme unplanned outages 00:18:57.319 --> 00:19:00.319 extreme low wind output would characterize some of 00:19:00.319 --> 00:19:04.829 the variables on the demand side. Similar to what Uri 00:19:04.829 --> 00:19:07.970 would be. However, what's fundamentally different is 00:19:07.980 --> 00:19:10.930 the amount of outages that would, uh, would be in place 00:19:10.930 --> 00:19:13.890 because of the kind of weatherization efforts that 00:19:13.890 --> 00:19:16.799 have taken place. And so there's some comparability 00:19:16.799 --> 00:19:18.640 to it in terms of the demand side. But the overall 00:19:18.640 --> 00:19:21.250 performance and the impacts of that I think would be 00:19:21.250 --> 00:19:23.470 very different than what we experienced during jury 00:19:24.779 --> 00:19:28.220 So to follow up, is it safe to say or not safe 00:19:28.220 --> 00:19:33.859 to say that a winter storm, Uri type of scenario would 00:19:33.869 --> 00:19:39.519 leave the grid in the red Specifically by 9000 MW and 00:19:39.519 --> 00:19:42.740 changed. No, I don't think that would be a reasonable 00:19:42.740 --> 00:19:46.009 assumption because a winter storm, Uri type of event 00:19:46.009 --> 00:19:50.130 which is a sustained low temperature storm. We could 00:19:50.130 --> 00:19:53.029 see an example of that in the first column where we 00:19:53.029 --> 00:19:57.220 have an extreme even more severe weather demand during 00:19:57.220 --> 00:20:00.779 a storm, which is at 80,000 MW, which if you look at 00:20:00.779 --> 00:20:03.819 that's actually above even our peak in the summer and 00:20:03.819 --> 00:20:06.660 we are a summer peaking state. So you could look at 00:20:06.660 --> 00:20:10.859 that scenario and say okay with a sustained long event 00:20:10.869 --> 00:20:15.259 at a very high level of demand and with expected renewable 00:20:15.259 --> 00:20:19.420 performance um, and typical unplanned outages which 00:20:19.420 --> 00:20:21.859 based on the weatherization work that we've done, we 00:20:21.859 --> 00:20:26.089 would expect typical outages that you would see performance 00:20:26.099 --> 00:20:28.700 continuing to support greater reliability in that scenario 00:20:28.700 --> 00:20:30.470 So I think, I don't think it's fair to say that the 00:20:30.470 --> 00:20:34.099 third column is a is a fury like scenario because all 00:20:34.099 --> 00:20:37.750 three of them have characteristics of the Uri storm 00:20:37.750 --> 00:20:40.400 event and the majority of them show that we would continue 00:20:40.400 --> 00:20:43.819 to be able to keep reliability on throughout. 00:20:58.180 --> 00:20:59.599 Are there any other questions on the phone? 00:21:02.440 --> 00:21:04.480 There are no further questions from the phones. 00:21:07.849 --> 00:21:12.819 We do. I'm sorry. We have a follow up from bob Sechler 00:21:15.589 --> 00:21:19.369 (item:2:Unidentified - Are we prepared for 10 degrees colder than Uri) Okay, thank you. Part of the conversation around Winter 00:21:19.369 --> 00:21:22.450 Storm Uri was that the grid was previously prepared 00:21:22.460 --> 00:21:26.750 for the 2011 standards based on these new categories 00:21:26.750 --> 00:21:29.230 and the work that's been done to the redesign, are 00:21:29.230 --> 00:21:32.329 we prepared for another Uri or we prepared for a storm 00:21:32.329 --> 00:21:36.190 that's gonna be 10° colder than that one. I expect 00:21:36.190 --> 00:21:38.880 to be prepared for both of those because of the comprehensive 00:21:38.880 --> 00:21:42.490 nature of all of these reforms and how they combined 00:21:42.490 --> 00:21:47.329 together to be greater than the sum of the parts. Uh 00:21:47.339 --> 00:21:51.009 not only do we have a winterized generation fleet now 00:21:51.019 --> 00:21:53.920 which is a tremendous difference from both 2011 and 00:21:54.200 --> 00:21:57.019 winter storm, you're in 2021 that's an absolute game 00:21:57.019 --> 00:22:01.460 changer. We now have better coordination and, and mapping 00:22:01.470 --> 00:22:04.160 of the natural gas supply chain. So we expect that 00:22:04.160 --> 00:22:07.119 to work this winter. We now actually have another 3000 00:22:07.119 --> 00:22:10.819 megawatts of, of fuel on site, physically on site of 00:22:10.819 --> 00:22:14.099 the generator. We've got better coordination with text 00:22:14.099 --> 00:22:17.009 dot so that the problems that that previously were 00:22:17.009 --> 00:22:21.069 experienced in winter storms with access to natural 00:22:21.069 --> 00:22:23.970 gas facilities, access to generators, access to coal 00:22:23.980 --> 00:22:29.000 can be mitigated by the turk uh, council working in 00:22:29.000 --> 00:22:32.269 conjunction like we did last winter uh, in in the State 00:22:32.269 --> 00:22:35.589 Operations Center. So we, the comprehensive nature 00:22:35.589 --> 00:22:37.920 of these reforms and the fact that they encompassed 00:22:37.920 --> 00:22:40.380 not just the grid, but other, the natural gas industry 00:22:40.380 --> 00:22:46.730 transportation, water all combined to ensure that were 00:22:46.730 --> 00:22:48.980 more reliable than ever. Going into this winter 00:22:51.519 --> 00:22:55.299 moderator, we can take the question. Okay, then we'll 00:22:55.299 --> 00:22:59.109 go back to the line of bob Sechler. (item:2:Bob Sechler, Austin-American Statesman follow up questions) Hey, thank you 00:22:59.119 --> 00:23:03.039 Uh two quick follow up the first is this, you know 00:23:03.039 --> 00:23:07.980 back in october, the federal agency released the assessment 00:23:07.990 --> 00:23:11.000 that kind of came to the same conclusion that given 00:23:11.009 --> 00:23:14.130 in certain circumstances, severe circumstances, we 00:23:14.140 --> 00:23:19.799 could and would have not have enough power. Uh, so 00:23:19.799 --> 00:23:22.869 I just wanted to see if you, if you thought of that 00:23:22.869 --> 00:23:25.480 is the same way you mentioned this one and sort of 00:23:25.480 --> 00:23:28.509 that's just arithmetic that doesn't take into account 00:23:28.519 --> 00:23:31.930 things like winterization, things like improve communication 00:23:31.940 --> 00:23:34.779 and that type of thing. And the other question is sort 00:23:34.779 --> 00:23:39.240 of related and that is uh, you know, this is, will 00:23:39.240 --> 00:23:41.619 be the second report that says that, that, you know 00:23:41.630 --> 00:23:44.769 we paged through the report and guess what? There's 00:23:44.779 --> 00:23:49.839 there's red indicating not enough power. And you know 00:23:49.849 --> 00:23:52.230 it sounds like, I mean you think that the public should 00:23:52.230 --> 00:23:55.400 sort of just ignore that and just count that. And I'm 00:23:55.400 --> 00:23:58.819 just curious what like that, you know, that that's 00:23:58.819 --> 00:24:00.769 not something they necessarily should be concerned 00:24:00.769 --> 00:24:04.029 about. And I'm just wondering how, how we should look 00:24:04.029 --> 00:24:07.549 at that, given that reports seem to say one thing and 00:24:07.559 --> 00:24:08.960 and you seem to say another. 00:24:10.650 --> 00:24:15.339 I think actually I want that column to highlight for 00:24:15.339 --> 00:24:17.970 everybody the importance of the changes that are needed 00:24:17.980 --> 00:24:21.029 in the market design. That's you're bringing up a point 00:24:21.029 --> 00:24:23.569 that I think we're all very consistently trying to 00:24:23.859 --> 00:24:27.559 reflect as well, which is, it is critically important 00:24:27.559 --> 00:24:30.009 to address the fact that there are scenarios, there 00:24:30.009 --> 00:24:32.849 is a scenario where under the most extreme conditions 00:24:32.849 --> 00:24:35.799 there could be not enough power that's not acceptable 00:24:35.809 --> 00:24:38.150 We don't find that to be an acceptable circumstance 00:24:38.160 --> 00:24:40.549 And that's why change is needed in the market design 00:24:40.549 --> 00:24:43.299 in order to address that. So we're not trying to underplay 00:24:43.299 --> 00:24:46.849 it at all. It does reflect a very low probability scenarios 00:24:46.849 --> 00:24:48.990 So we want to be clear on what it is, it is 00:24:48.990 --> 00:24:51.740 a low probability scenario. And so time back to what 00:24:51.740 --> 00:24:54.470 you said about the Newark report. The report said the 00:24:54.470 --> 00:24:57.210 same thing. It was a low probability scenario and we 00:24:57.210 --> 00:25:00.289 believe that to be true. But the fact that it exists 00:25:00.490 --> 00:25:03.339 calls out an issue that needs to be addressed an issue 00:25:03.339 --> 00:25:05.430 that needs to be addressed Around the overall design 00:25:05.430 --> 00:25:08.569 of the market and being able to continue to build dispatchable 00:25:08.569 --> 00:25:11.619 generation to ensure there will always be enough power 00:25:11.880 --> 00:25:14.779 And so we are emphasizing that we want to call that 00:25:14.779 --> 00:25:18.049 out very clearly and we agree 100% with the point that 00:25:18.049 --> 00:25:21.000 is an important data point for everyone to understand 00:25:21.000 --> 00:25:23.240 And that's why this work that we're embarking on is 00:25:23.240 --> 00:25:26.880 so important. And so back to your first question, the 00:25:26.880 --> 00:25:29.549 differences between the scenarios. The first the report 00:25:29.549 --> 00:25:32.069 is really based on just one scenario. And so the fact 00:25:32.069 --> 00:25:34.279 that it shows a low probability likelihood of some 00:25:34.279 --> 00:25:36.859 kind of a low shed event just like ours does. And there's 00:25:36.859 --> 00:25:38.869 some differences in the numbers really is just a math 00:25:38.869 --> 00:25:42.039 exercise on the basic assumptions but that the main 00:25:42.039 --> 00:25:44.039 points on both the new york as well as our report is 00:25:44.039 --> 00:25:47.069 that under the majority of scenarios we do expect reliable 00:25:47.069 --> 00:25:50.460 operations this winter, but again, not to underscore 00:25:50.460 --> 00:25:52.720 the importance of the fact that change is needed and 00:25:52.720 --> 00:25:55.559 we're here to to let people know that we know how important 00:25:55.559 --> 00:25:57.680 that is. And we're gonna continue to drive that change 00:25:57.680 --> 00:25:59.940 until we see the results we need we get we want 00:26:02.440 --> 00:26:03.339 anyone else on the phone. 00:26:05.390 --> 00:26:09.900 Yes we'll go next to the line of we'll go back to 00:26:09.900 --> 00:26:12.109 the line of Mr Buchele. (item:2:Mose Buchele, KUT Radio) 00:26:13.619 --> 00:26:16.029 Hey thanks so much for taking the follow up. You know 00:26:16.039 --> 00:26:19.700 obviously everyone's most concerned about the possibility 00:26:19.700 --> 00:26:24.180 of blackouts but I was curious to to to get um some 00:26:24.180 --> 00:26:27.829 more information on the potential likelihood of you 00:26:27.829 --> 00:26:31.430 know uh conservation calls or energy emergency alerts 00:26:31.440 --> 00:26:35.859 It looks like under most scenarios in the extreme assumptions 00:26:35.859 --> 00:26:40.420 category that would be on the table. Um And you know 00:26:40.430 --> 00:26:42.970 I just I guess I just like to get comments about that 00:26:42.980 --> 00:26:46.240 given given extreme weather and some other sets of 00:26:46.240 --> 00:26:49.670 circumstances we may expect um that that type of reaction 00:26:49.670 --> 00:26:52.539 which is you know part of great operations. I assume 00:26:53.099 --> 00:26:56.849 we'll continue to use every tool available to keep 00:26:56.849 --> 00:27:01.190 the lights on including conservation alerts uh and 00:27:01.700 --> 00:27:05.779 the industrial demand response and our voltage support 00:27:05.789 --> 00:27:09.230 and every other resource we have to keep the lights 00:27:09.230 --> 00:27:13.990 on. And while this math exercise does show some scenarios 00:27:14.000 --> 00:27:19.829 uh that put us into emergency conditions we have reforms 00:27:19.829 --> 00:27:25.869 and tools to mitigate the problems that are the that 00:27:25.869 --> 00:27:29.839 would be outlined here. So we we expect we'll use the 00:27:29.839 --> 00:27:34.059 tools we need to including conservation notices. if 00:27:34.059 --> 00:27:35.920 either of you could also just explain a little bit 00:27:35.920 --> 00:27:40.609 more why the the assessment chooses to not include 00:27:40.619 --> 00:27:44.869 unplanned outages during your e in the in the thermal 00:27:44.880 --> 00:27:48.839 generating outage assumption and maybe this, I mean 00:27:48.849 --> 00:27:51.769 that was obviously a kind of super extreme event of 00:27:51.769 --> 00:27:54.359 outages but there was a decision made to not include 00:27:54.359 --> 00:27:57.150 that in the assumptions about where power plants might 00:27:57.160 --> 00:28:01.880 go dark. Uh In the course of this winter our power 00:28:01.880 --> 00:28:06.190 plants are, They have coordination with natural gas 00:28:06.190 --> 00:28:09.140 so disruption of natural gas and freezing the generators 00:28:09.150 --> 00:28:13.049 that was experienced during Uri and 2011 has been mitigated 00:28:13.059 --> 00:28:15.450 and we saw the results of that last winter. 00:28:18.390 --> 00:28:19.569 Thank you. 00:28:23.339 --> 00:28:28.410 There are no further questions from the phones uh maybe (item:2:unidentified question on Reliability Standard) 00:28:28.420 --> 00:28:31.789 is there a target amount of total resources you'd like 00:28:31.799 --> 00:28:34.019 to see your target amount of thermal resources you'd 00:28:34.019 --> 00:28:38.579 like to see on the grid available by max winter? The 00:28:38.589 --> 00:28:41.390 way we think about it more is is really looking at 00:28:41.400 --> 00:28:45.200 um overall loss of Load events is the term that we 00:28:45.200 --> 00:28:48.230 use. And so we want to try to drive towards like a 00:28:48.240 --> 00:28:51.039 very low likelihood of losing Load at any point in 00:28:51.039 --> 00:28:54.039 time, whether it be winter summer or in between. And 00:28:54.039 --> 00:28:56.789 so that's really more the metric that was the basis 00:28:56.789 --> 00:29:00.230 for the E three study that was done uh in the last 00:29:00.230 --> 00:29:02.579 couple of months was defining and they used a kind 00:29:02.579 --> 00:29:05.099 of an industry standard loss of load, which was one 00:29:05.279 --> 00:29:08.500 Every 10 years is something that has been used in other 00:29:08.500 --> 00:29:11.589 markets around the world. And so they use that to come 00:29:11.589 --> 00:29:14.099 up with the overall modeling that we saw in that that 00:29:14.099 --> 00:29:17.009 assumption. And so we're really looking at it more 00:29:17.009 --> 00:29:19.509 through that lens and saying a particular number of 00:29:19.519 --> 00:29:22.140 megawatts from this source or from that source because 00:29:22.140 --> 00:29:24.259 we really want to be more technology agnostic and how 00:29:24.259 --> 00:29:26.829 this market evolves and allow them market to evolve 00:29:26.829 --> 00:29:28.950 in a way that delivers the reliability outcomes that 00:29:28.950 --> 00:29:31.650 we're looking for and those kinds of metrics drive 00:29:31.650 --> 00:29:33.009 to those reliability outcomes. 00:29:38.410 --> 00:29:41.519 That's an important point. We don't have a reliability 00:29:41.519 --> 00:29:44.690 standard now that would dictate a goal of how much 00:29:44.789 --> 00:29:49.059 reliable dispatchable generation we need and we fully 00:29:49.059 --> 00:29:51.930 expect to keep the lights on like we have this winter 00:29:51.930 --> 00:29:53.900 like we have in the past, but it's getting harder. 00:29:53.900 --> 00:29:56.369 We have more people a new corpus Christi every year 00:29:56.369 --> 00:29:59.670 and we have the same amount of reliable dispatchable 00:29:59.670 --> 00:30:03.750 resources uh, with no target, no reliability standard 00:30:03.759 --> 00:30:06.990 which is a key part of the Phase two reforms that this 00:30:06.990 --> 00:30:10.400 commission is evaluated and discussed and is taking 00:30:10.400 --> 00:30:15.019 public comment on now and that's a goal we need to 00:30:15.019 --> 00:30:17.650 work towards and because it's getting harder and harder 00:30:17.650 --> 00:30:20.190 to do this because we have more people, the same amount 00:30:20.190 --> 00:30:23.519 of reliable resources is why this Phase two market 00:30:23.519 --> 00:30:28.349 redesign is so important. Uh this is a long term problem 00:30:28.359 --> 00:30:32.099 of lack of a reliable reliability standard but the 00:30:32.099 --> 00:30:32.890 future is coming. 00:30:35.029 --> 00:30:37.180 Thank you. Thank you. 00:30:39.099 --> 00:30:41.269 We do have another follow up from the phone. If you'd 00:30:41.269 --> 00:30:46.359 like to take it, that's fine. Back to the lineup. Mr 00:30:46.359 --> 00:30:49.500 Buchele. (item:2:Mose Buchele, KUT Radio, follow up question) Hey there, sorry to keep popping back and 00:30:49.500 --> 00:30:51.740 I, you know I just had a question for Chairman Lake 00:30:51.740 --> 00:30:57.599 just about about PUC operations. Uh you mentioned um 00:30:57.609 --> 00:31:00.759 not having a clear reliability standard. That was one 00:31:00.759 --> 00:31:03.549 thing that was highlighted in the sunset staff report 00:31:03.549 --> 00:31:07.009 last week. Another thing that that came up was just 00:31:07.019 --> 00:31:12.000 uh the number of staff at PUC um it's recommended that 00:31:12.000 --> 00:31:15.390 you have had to greatly increase your staff side. You 00:31:15.390 --> 00:31:18.009 know what are you thinking about in terms of preparing 00:31:18.009 --> 00:31:20.660 for winter and the staff side you have now and how 00:31:20.660 --> 00:31:24.680 the agency might benefit from having more like other 00:31:24.680 --> 00:31:27.390 resources. I guess you could say this staff has done 00:31:27.400 --> 00:31:32.380 an incredible job in fulfilling the tasks they were 00:31:32.380 --> 00:31:35.390 assigned with after winter storm Uri by the Legislature 00:31:35.400 --> 00:31:39.150 It's a tremendous group of people but we've been given 00:31:39.160 --> 00:31:41.579 a heavy burden and yes we need more staff. We need 00:31:41.579 --> 00:31:45.279 more resources. We still have a lot of work to do and 00:31:45.289 --> 00:31:49.220 so I wholeheartedly agree we need we need more great 00:31:49.220 --> 00:31:50.680 folks like the people we have here. 00:31:52.750 --> 00:31:55.289 Thank you. Thank you. Thank you. Thanks 00:31:57.509 --> 00:31:58.710 no further questions