(item:0.1:Chairwoman Jackson calls meeting to order & Commissioner McAdams' recognition) Good morning. This meeting of the Public Utility Commission
of Texas will come to order. To consider matters that
have been duly posted with the Secretary of State for
August 3, 2023. For the record, my name is Kathleen
Jackson. I'm joined by Will McAdams, Lori Cobos and
Jimmy Glotfelty. Before we get started, I just wanted
to recognize Commissioner McAdams for being selected
as Vice President of SPP's Regional State Committee.
Congratulations. Thank you.
Volunteer work is always appreciated in other places.
Glutton for punishment. We so appreciate your leadership role and
having a seat at the table. Thank you all. McAdams for President.
I don't know how she writes in the transcript.
(item:0.1:Shelah Cisneros with Commission Counsel lays out Consent Agenda) Shelah, please walk us through the Consent Items on
today's Agenda. Good morning, Commissioners. By individual
ballot, the following items were placed on your Consent
Agenda. Items 3, 5-7, 11, 17, 18, 31 and 32.
(item:0.1:Chairwoman Jackson asks for motion to approve items on Consent Agenda) I will entertain a motion to approve the Items just
described by Shelah.
So moved. Second. I have a motion and a second. All in favor, say aye. Aye.
Motion passes. Additionally, Items 10 and 12 will
not be taken up. (item:1:Chairwoman Jackson lays out instructions for Public Comment) Let's begin with Item No. 1,
Public Comment. Oral comments related to a specific Agenda
Item will be heard when that item is taken up. This
is for general comments. When we get to oral comments
on specific items, stakeholders should not approach
the table unless oral argument has been granted or
they have been invited by a Commissioner. Speakers
will be limited to 3 minutes each. (item:1:Shelah Cisneros confirms there are no Public Comments) Shelah, do we
have anyone from the public signed to speak? No, ma'am.
No one is signed up to speak. (item:1:Chairwoman Jackson closes Public Comment) If not, Public Comment is
now closed.
Next up is Item No. 2. Shelah, will you please
lay out this item? Yes. (item:2:Shelah Cisneros lays out petition of multiple MUDs appealing City of Round Rock's wholesale water & wastewater rates) Item No. 2 is Docket No.
48836. This is the petition of Paloma Lake MUD Nos.
1 and 2, Vista Oaks MUD, Williamson County MUD,
Nos. 10 and 11. Appealing the wholesale water and
wastewater rates of the City of Round Rock. At the April
27 Open Meeting, the Commission considered the petitioner's
appeal of Order No. 30, and Commissioner Cobos filed
a memo. Commissioner Cobos, would you please walk us through
your memo? Yes. (item:2:Commissioner Cobos’ lays out her memo) So, um my memo has a draft order appended
to it. And basically the draft order uh memorializes
the Commission's determinations at the April 27, 2023
Open Meeting. That reversed the SOAH ALJ's denial of the district's
motion to compel. Um, and a finding that Round Rock's
2017 wholesale sewer rates and 2018 wholesale water
rates are the subject of the district's appeal, in
this order.
The draft order also clarifies the Commission's prior
determinations um in, in its order on appeal of SOAH
Order No. 17 and the discussion at the April 27,
2023 Open Meeting. By finding that a public interest
determination that the Commission is not required um
under Texas Water Code Section 13.044. Um before fixing
rates that are on appeal. And then secondly, that the
Commission um rather that the um date that, that the
rates that were instituted by law, at the time of the
appeal. Are the rates that are the subject of the appeal.
So in other words um that, the um, you know the,
the rates are not the rate set after a final order.
That is issued by the Commission. So those are the
two main clarifications. Because Texas Water Code 13.
044, has specific statutory provisions that set forward
this process. And I, my order just clarifies that process.
Um based from our discussion at the open meeting and
our order, on order appeal of Order No. 17.
You have any discussion? Hey, uh, (item:2:Commissioner McAdams’ thoughts on Commissioner Cobos' memo) Commissioner Cobos
I would like to thank you first for filing the memo
and the order. Um it took uh it, it took it was
yeoman's work. Um to move this along to clarify and
to um appropriately order uh the decisions that the
Commission needs to affirm and clarify as part of this
uh proceeding. I agree with your interpretation of
the Water Code 13.044. And uh and if appropriate um
pending any other discussion. (item:2:Motion to approve draft order on appeal that's attached to the memo) Uh I would move to approve
the draft order on appeal of SOAH Order No. 30 attached
to your memo. Uh I'm, uh I would second that. Okay, we
have a motion and a second. All in favor, say aye. Aye.
Motion passes. Thank you, ma'am.
Item No. 3 was Consented. Next up is Item No.
4. Shelah, will you please lay out this item? Yes.
(item:4:Application of Undine Development, LLC for system improvement charges) Item No. 4 is Docket No. 53109. This is the
application of Undine Development, LLC for system improvement
charges. And bear with me while I lay this one out. Um
in this Docket the SOAH ALJ certified 5 issues to
the Commission. Regarding the exclusive jurisdiction
of water, over water and sewer rates at the March 23
Open Meeting. The Commission decided that for 2 of
the jurisdictional issues. It was appropriate to seek
an Attorney General opinion and delayed responding
to the certified issues. On June 30, the AG's Office
sent a letter declining to issue an opinion on the
two jurisdictional issues, as a matter of policy. Because
a separate pending docket at SOAH implicates the same
jurisdictional issues. So now we're back to where we
left off at the March 23 Open Meeting. And the 5
certified issues are before you for consideration.
And Commissioner McAdams filed a memo on this Docket.
Would you like to lay out your memo? Yes, ma'am. Um
(item:4:Commissioner McAdams’ lays out his memo) And my memo was intended uh to start as a jumping off
point. Um, so that we can order our thoughts and, and
ultimately affirm some decisions. Um I started by spending
some time with the transcript from our March 23
uh Open Meeting. And I think, uh as a part of our
discussion at that meeting. We had established consensus
on the issues of good cause. Um And that we had agreed
that an area is either clearly in the municipality's
corporate boundaries or in extraterritorial jurisdiction.
Next, I believe that we uh, we need to affirm our position
on two issues we had previously spoken to. Um first
a property in a subdivision that is partially inside
and partially outside of the corporate limits. We appeared
to agree that the location of the residence should
be the determining factor um in establishing jurisdiction.
Now second, for an area that has been fully annexed.
I believe we agreed that the area in question would
be under the municipality's jurisdiction.
Now, for the part that we had not reached conclusive
agreement on as per our discussion. When an area that
is annexed by municipality for limited purposes, that's
how it uh what we did not settle on. This could be
a situation where an area has been annexed for limited
purposes of as examples, um firefighting services. Or
it could in fact be an area where uh that has been
annexed for the purposes of water and sewer services.
In these instances. I think we need to look at the
specific facts in a given case to make the determination.
If it can be shown that a municipality undertook annexation
for the limited purpose of providing water and sewer
service. Then the area would be under the municipality's
jurisdiction. If on the other hand, the municipality
appears to have annexed the area without demonstrated
intention to provide water or sewer service. Then I
think the area remains under our jurisdiction. Um now
I, I don't wanna get into this next point too deeply
because I don't think we have to. But as a further
thought, uh I will want to revisit this issue if we
arrive at a scenario. Where the residents of an area
annexed for limited water and sewer purposes cannot
vote in an election for the municipality in question.
Now, that does not appear to be an issue here in this
project. Um so we don't need to address the issue in
my opinion, uh as an on an advisory basis. But in the
future, if those scenarios do arrive. I believe we
will need to readdress that. Um and I'd welcome any
discussion on kind of the parameters, the framework
of uh the policy that I've laid out.
(item:4:Commissioner Cobos’ thoughts on Commissioner McAdams' memo) Commissioner McAdams, I generally agree with all of
your um, decision points on, on the different scenarios
that can arise in these, in these case. That the one
that I would like to explore a little bit more is the
limited purpose annexation. And that one, that one
I'm just wondering. Um the City of Austin has not
been very involved in this case. And I'm wondering
how much cities in the future will be involved in these
cases. And so who would provide us with the information
to review. Um to determine whether the ordinance is
limited purposes extended to water and sewer, rate and
service, and operation. So I'm just wondering mechanically
how that would work going forward. I I, you know, the
utilities it's, you know, they want us to process
these cases, right? Because that, that's what they
want and it would be to their benefit. Um for those
properties to stay under our jurisdiction. Um the cities
as we've seen with the City of Austin hasn't been involved
here. And it's up to them if they wanted to intervene
in these cases. But I'm just wondering if, if they're
gonna be, you know, vocal in our cases going forward.
And what documentation who would provide that documentation
for our review? And would it make, you know, an alternative
would be to potentially just a certain jurisdiction.
And if somebody had a problem with it they, they could
challenge our, our decision or, or submit documentation.
Telling us that they want to serve their own jurisdiction
as a new city. I'm just trying to think mechanically
going forward. Because of what we've seen with this
one case, the first case. What it's gonna look like
in the future. (item:4:Commissioner McAdams’ follow-up on his memo) So I believe this framework that I laid
out establishes a message if disputes arise. And again
if clarity is not present as it, as it relates to this
limited purpose. Then uh within those disputes, we
look to okay what was the fact pattern behind the annexation.
Uh and that's the determining factor. So again, it
will be a case-by-case basis as these move through.
But if there is ambiguity, the Commission through this
uh project has asserted jurisdiction. Um and it is
the default position of regulator of last resort. Okay.
So we have a SIC case in the future and there's
no submission of an ordinance documentation. On, on
the fact pattern behind the, the limited purpose annexation
then we just assert jurisdiction.
Yes unless uh other, other uh evidence can be brought
forward to clarify that.
(item:4:Commissioner Glotfelty's thoughts on Commissioner McAdams memo) I mean I, I'm kind of falling on the, the
side of Commissioner Cobos. Which is just assert as
much jurisdiction as we can right now and leave less
ambiguity. And um it's not to say that yours is wrong.
I don't think either of them are wrong. It's just a
matter of how we uh, uh try to be clear. I think
this is gonna get a little muddy either way. Yeah, I agree. Um and
you know, as I said in the first discussion of this.
Um we, we don't need anybody else to tell us who our
where our jurisdiction is. Um, at least parties to
the cases and I think the cases will all work themselves
out in time. So I can go either way on this. I'm
not uh I think we need to find consensus. On what
is the uh most expeditious way and the clearest way
to go forward. Um, yeah. (item:4:Commissioner McAdams’ additional thoughts on his memo) No, no I see the argument.
It is a default position of the Commission. And, and
that's where uh I mean, I strongly agree with that.
Um, my proposal was following a line of thought to
where okay um, when we get into these disputes. There's
going to be an establishment of a, of a fact pattern.
And that's where okay they either annexed and asserted
that they were going to own this responsibility of
regulating these rates or they didn't. In which case
um the, the next step is okay Commission has it. We've
got the ball and we need to set those rates. Uh, but
if a blanket statement of uh jurisdictional scope
is you know more clear I, I do not oppose that. (item:4:Commissioner Cobos’ follow-up comments on the memo) And
I'll be the first to recognize that I, I wanted more
you know, feedback on this. Yeah you did. And, you know, you were the one who
wanted a lot of arguing. And, and I think I would recognize also that
you wanted, you both wanted to steam forward ahead.
Um and make the cut and go forward. And that's why
I kind of went from okay, we're not gonna get an AG
opinion then let's just. Let's own it. You know let's, let's own
it and move forward. And, um but you know I, I just
really wanted to discuss the mechanics of how it would
look like in the future. Right. And, and I mean, these cases
are, are a little bit different than what we've been
dealing with, with every other case, right? And the
whole point of the SIC proceedings is to have an efficient
process. So these water utilities come in and start
recouping their costs on their infrastructure investment.
And this is the first one and I know there's probably
some lined up in the back. And they're looking to this
case to see um you know we can gain some traction
and efficiency. And process. And process um as we kind of
um unpack this first one. Yeah. Which in turn benefits the
ratepayers.
So in terms of the clear assertion of Commission jurisdiction
uh how would you, um how would you articulate that?
(item:4:Commissioner Cobos' articulation of Commission jurisdiction) I think I would just say, um as a matter of law.
We would find that um the Commission has jurisdiction
and limited purpose, annexation um areas and, and move
forward. And if, if somebody wants to challenge us down
the road they're, they're welcome to. But at this
point we, we you know the City of Austin didn't intervene
and we don't have any um real certainty. Yeah, that
the other cities are gonna get involved. And, and um
they may not even really you know. I just don't want
to sort of um add more on our end. When we don't
even know what the future looks like with the cities
getting involved and we can't make them intervene.
And so I think just pushing forward as a matter of
law that we're gonna start our jurisdiction. And, and
um we'll deal with any challenges down the road if,
if any arise. Just to make sure we have clarity on the
other parts of the memo. Do we, do we all agree on
the other aspects of the memo? Yes. Yes. Okay, great.
Um so for a limited purpose uh, annexation uh the
Commission would assert uh our authority. Based on the
principles outlined in the residence uh of the, uh
of the um. Help me out here, Shelah. The residence?
The location of the premises. The relocation of premises
yeah.
(item:4:Commissioner Glotfelty's thoughts on Commission jurisdiction) I'm supportive of that. I mean, I think that's the
right way to go. And
I would move, I would so move that we uh, uh. Do
we have an order for that or do we need to write
the order for that? Write the order. Modify the order
to be consistent with our discussion. (item:4:Shelah Cisneros' clarification on a modified order consistent with memo & discussion) It would uh
so there's not an order before you this time. But it
would be uh it would be responding to the certified
issues consistent with Commissioner McAdam's memo and
is modified by the discussion. That's what I would
move.
Second. Is what I, is what I heard the Commission say to me.
(item:4:Motion to respond to certified issues with an order consistent with memo & discussion) Okay, so you move for the Commission to respond to the
certified issues with an order that is consistent with
Commissioner McAdams' memo and our discussion. We have
a second. All in favor, say aye. Aye. Motion passes.
Items 5, 6 and 7 were Consented. Next up is Item
No. 8. Shelah, will you please lay out this
Item? Yes, ma'am. (item:8:Complaint of Rio Bravo Subdivision Property Owners Assoc. against Valley MUD No. 2) Item 8 is Docket No. 54532.
This is the complaint of Rio Bravo Subdivision Property
Owners Association against Valley MUD No. 2.
Before you is proposal for decision filed on June 22.
No corrections or exceptions were filed by the parties.
Chairman Jackson filed a memo and a Commission Counsel
memo was filed, recommending changes to the PFD. (item:8:Chairwoman Jackson lays out her memo) I
did file a memo here. I think the PFDs recommendation
to dismiss the complaint is appropriate. However, I
recommend the basis for dismissal be changed from lack
of jurisdiction to failure to state a claim. For which
relief can be granted as detailed in my memo. So any
additional thoughts on this one? (item:8:Commissioner McAdams' thoughts on Chairwoman Jackson's memo) No I, 100% agree with
the, the changes and I appreciate you filing a memo.
I think it makes the motion easier. Agreed. Agreed.
(item:8:Motion to modify PFD in accordance with memo) Then I would make a motion to modify the PFD in accordance
with my memo. Second. Second. (item:8:Shelah Cisneros' comments with consideration of updating motion) May, I would ask to maybe consider
revising that. There's also, there's your memo and
also the Commission Council
memo. And the Commission Counsel memo. And consistent with the Commission Counsel
memo. (item:8:Motion revised) Um so you have a revised motion. Second. All
in favor, say aye. Aye. Motion passes.
Next up is Item No. 9.
Yes, ma'am. (item:9:Complaint of Jyoti Naik Against Guadalupe Blanco River Authority) Item No. 9 is Docket No. 54533.
This is the complaint of Jyoti Naik against Guadalupe Blanco
River Authority. Before you is a proposal for a decision
that was filed on June 27. No corrections or exceptions
were filed by the parties. Commissioner. I'm sorry.
Chairman Jackson filed a memo on this one as well.
And there is also a Commission Counsel memo that was
filed, recommending changes to the PFD. (item:9:Chairwoman Jackson lays out her memo) I did file
a memo here similar to the last Item. I think the PFDs
recommendation to dismiss the complaint is appropriate.
However, I recommend that the basis for dismissal be
changed from lack of jurisdiction to failure to state
a claim. For which relief can be granted as detailed
in my memo. Uh any additional thoughts on this
one? (item:9:Motion to approve modification and Commission Counsel conclusions of law) I would just move that we approve
the modification that you outlined in your memo. And
in addition to the Commission Counsel conclusions of
law and uh I make that motion. Second. We have a motion and a
second. All in favor, say aye. Aye. Motion passes.
Item 10 will not be taken up. Item 11 was Consented.
Item 12 will not be taken up. I don't have anything
for 13 or 14 unless, unless y'all do? Uh next up is
Item No. 15. Shelah, will you please lay out this Item.
Yes, ma'am. (item:15:Application of CenterPoint Energy for approval to amend its DCRF) Item No. 15 is Docket No. 53442.
This is the application of CenterPoint Energy for approval
to amend its DCRF. Before you are motions for rehearing
on the Commission's order on rehearing that was filed
on May 25. Team and Arm filed a joint motion for rehearing
and the Texas Competitive Power Advocates also filed
a motion for rehearing. (item:15:Chairwoman Jackson recommends denial of motions for rehearing) I would recommend that we deny
the motions for rehearing. Uh any thoughts? I don't
think the parties have identified any issues that
warrant rehearing. (item:15:Commissioner McAdams' motion to deny rehearing) So uh I would move to deny the
rehearing in this matter. I second. A motion and a second.
All in favor, say aye. Aye. Motion passes. Next up is Item
No. 16. Uh Shelah, will you please lay out this
Item? (item:16:Application of Entergy Texas for authority to change rates) Item No. 16 is Docket No. 53719. This
is the application of Entergy Texas for authority to
change rates. Before you is a SOAH proposal for a decision
that addresses two issues from the preliminary order.
Related to vehicle charging stations or vehicle charging
facilities. And other transportation, electrification
and charging infrastructure. Also before you is an
unopposed agreement between the parties on other issues
in the proceeding. Uh Commissioner Cobos, as our MISO
representative, would you like to start this discussion?
Good. (item:16:Commissioner Cobos' thoughts on the application) Yes, I would. Um okay. So based on my review of the
NFO settlement agreement, um I am in favor of approving
the agreement. The agreement seems to be a reasonable
resolution of the case. It strikes an appropriate middle
ground among the parties. Um it, it was reached out
to full discovery direct testimony. And um I think
that um the agreement is, is reasonable and I think
we should approve the agreement. Um, with respect to
the PFD on the electric vehicle issues. I just want
to lay out three options that we have and then identify
the option that I'm in favor of. I guess the first
option we have is to dismiss the PFD and address these
issues later when we implement a rulemaking proceeding.
To implement the Legislation that was passed this past
session. However as we all know, we have a very long
list of rulemaking projects and Legislation to implement.
So we would be um stalling the implement this, this
process for moving forward and so that's um one option.
The second option is to remand the case back to Docket
management. Um so that um Entergy and the other parties
have an opportunity to file evidence. And that evidence
being the proposed revised tariff and the opportunity
and the parties have an opportunity to respond to that
evidence. However um we would be, you know, basically
holding back the settlement agreement on all the other
issues that set the base rates for the company. And
um in order to make a decision on riders. And so I
I don't know that this is the best option to move forward
on. The third and final option is um Severine did this
um these, these issues into a separate proceeding. So
that Entergy can enter the proposed revised tariffs
into evidence. As they had submitted them in their,
you know, reply exceptions to the PFD. Which are not
in evidence and then the parties would have an opportunity
to respond to the tariffs. That would then be in evidence.
We can move the record over from this case, the rate
case to the new proceeding. Because these issues on
the riders have been addressed. But the parties would
then have an opportunity to address these issues with
the Legislation that got passed. Um Senate Bill, um 1002.
And um also have an opportunity to um address those
issues with respect to the ownership that's laid out
in the Senate Bill. But also with how the costs will
be recovered for these um ed measures. So, um from
my perspective, I would be in favor of severing the
proceeding. And um moving forward in that process because
I think that's the cleanest way to move forward. I
think we have past precedent where in similar cases.
We have um you know, adjudicated proceedings on issues
that were addressed by Legislation before we've implemented
a rulemaking such as Mobile DG. And I think in this
situation, um given all the work we have in rulemaking
implementation of, of um Legislation. And, and remanding
and the inefficiencies there. I think severing is the
best course of action. (item:16:Commissioner McAdams' thoughts on application) Uh I, I support that. Um Entergy
is a high growth area of the state. Um it is in
the best interests of the, the people in that area.
To have a resolved uh comprehensive base rate proceeding
um we can do that now. And then address this separate
very targeted rider issue in the separate proceeding.
Uh that can be adjudicated as a, a contested case.
Um, parties can file uh we have active Legislation
that um will be enacted on September 1. That will have
to comply with anyway. It seems prudent to uh to
have the relevant discussion within the parties. Targeted
at both the implementation of that Bill and how uh
Entergy's rider can be formed moving forward. So I, I concur with Commissioner
Cobos. (item:16:Commissioner Glotfelty's thoughts on the application) Yeah, I think the question is, uh to me do
you remand it or do you sever it? Um I, it seems
the, the appropriate mechanism is to sever it. To allow
those issues to go forward on their own. Allow the
base rates to uh, to be completed. Um and um, I just
do wanna say that uh in the uh this is another creative
Black Box settlement, I think. Uh I'm just wondering
can we do a Black Box order?
Just kidding. Anyway, I approve that we uh we sever
it. And, and go forward with the order. And then as Commissioner
McAdams and Cobo said, move all the relevant information
over to a new, new docket. (item:16:Chairwoman Jackson's thoughts on the application) So I agree as well. And
I think, you know, the points that you brought up. And
that, you know, y'all as well have kind of underlined
uh it makes all the sense in the world. Southeast Texas
is a very high growth area. And um being able to kind
of move forward with this in the most expeditious way
possible. As well as having the opportunity to come
back and get the evidence on the two riders makes
all the sense. So, um we would entertain a motion. And
maybe the thought here would be to have um two separate
motions to sever first. And then um to direct uh OPDM
to draft an order. Um yes. So can, can we draft a
single order that approves the na post settlement
agreement and severs the um EV issues addressing the
PFD into a separate proceeding?
(item:16:Shelah Cisneros with Commission Counsel addressing the question of 2 separate orders) I think, I think it's possible. It may be cleaner to
have two separate orders. And I'm looking over at Steven
Journeay and Mark to see if they, if they nod and agree
with me.
Mark's nodding yes. Steven's nodding no. Whatever's best.
Were you just teasing her? Um I think because you would be directing
OPDM to draft an order consistent with the party's unopposed
agreement. Um and that may take a minute for us to
draft. Then we, if we have two separate orders. Um
one severing the PFD issues. We could possibly
that may move along a little bit faster. Okay. Whatever
is the most efficient way uh to proceed. I'm, I'm in
favor of. I just wanted to kind of see what, what it
meant to do with the order. And you could also, uh
perhaps you could, you could delegate authority to
use our judgment on whether one order, two separate
orders is, is the way is appropriate. Yes.
I would delegate that authority to use your judgment
Shelah.
Okay. Do you have what you need? Uh well, you haven't.
Uh I think you talked about doing two separate motions?
(item:16:First of 2 separates motions by Chairwoman Jackson related to PFD issues) Okay. So, um I would entertain a motion to um move that
we sever the PFD issues into a separate docket for
further processing by Docket Management. And that we
authorize the ALJ to transfer the relative portions
of the record related to the PFD issues into the new
docket. So
moved. Second. We have a, a motion and second. All in favor, say aye.
Aye. Motion carries. (item:16:Second of 2 separates motions by Chairwoman Jackson related to OPDM drafting orders) And then entertain a second um motion.
Um that we direct OPDM to draft an order that is consistent
with the party's unopposed agreement. So moved. Second. We have a motion
and second. All in favor, say aye. Aye. Motion passes.
Okay. Items 17 and 18 were Consented. I don't have anything
on items 19 or 20 unless y'all do? No ma'am. (item:21: Chairwoman Jackson lays out Project No. 53298) Um next up is
Item No. 21, Project 53298. Our wholesale electric
market design implementation project. And we're going
to discuss the ORDC. As a reminder, on January 19 of this
year, the Commission instructed ERCOT to evaluate bridging
options. To retain existing assets and build new dispatchable
generation until the PCM could be fully implemented.
On April 17, the R&M Committee voted to recommend
that the ERCOT Board approve ORDC enhancements for
recommendation to the Commission. Subsequently, on
April 18, the ERCOT Board recommended to the Commission
that the ORDC enhancements as the preferred bridge
solution. The Board's resolution recommends an enhancement
to the ORDC using a multi-step floor. The Legislature
has since passed HB1500. Uh ERCOT has filed some supplemental
information. PUC Staff and Commissioner Cobos also filed
memos. I think Harika is here.
If you could come on up. Um and then uh Commissioner
Cobos, uh do you want to go ahead and lay out your
memo so that we can have a discussion? (item:21:Commissioner Cobos lays out her memo) Yes. And, and
thank you for your background on, on this issue. As
we've been addressing this for several months now.
Uh my memo continues to reiterate my position that
I believe the near term action is important. Um to retain
our long duration, dispatchable thermal generation
um assets. That I believe are extremely necessary to
maintain reliability during extreme weather conditions.
And I believe that um we, we need to use a
market-based tool to incent self-commitment by generators.
In the real time market to help reduce RUC and that
that was the goal from my perspective. Of a near term
action bridge solution. And so my memo continues to
reiterate my position as laid out in my January memo.
Um on the goal and the intended purpose of a near term
bridge solution. But also lays out based on um on my
review of, of the um just what, what the intended goal
is. And to ensure that the intended purpose is fulfilled
lays out three specific metrics. That um I believe the
Commission should require ERCOT to track going forward
in their ORDC report. And specifically, those are
um providing information um in the report on the amount
of new revenue. That specifically results from the ORDC
price for adders. The specific type of generation
that received the new revenue from the ORDC price
for adders. And, and performance data showing whether
or not the ORDC price for adders are, in fact reducing
RUC. I think that's very important because again, my position
is the whole goal here was to, from my perspective
and I hear everyone else's perspective. Was that um
putting market based tool into incent generation self
commitment. To reduce RUC so that we take the physical
pressure off these long, older. Especially older, long
duration um thermal generation assets. Because we, we
need those for the multi day events, especially the
extreme cold um multiday event. So these metrics I
think help us keep track of whether or not this action
if approved by the Commission. Would is accomplishing
what we set out to do. Um also, I think that we
need to, in addition to this reporting measure. Um that
we, we would ask ERCOT to, to comply with. Um we would
have ERCOT, I would recommend that the Commission evaluate
the need for the ORDC price for adders after ERCOT implements
the dispatchable reliability reserve service. Um House
Bill 1500 required ERCOT to implement DRS by December
1, 2024. To account for market uncertainty and ERCOT
must develop criteria to ensure that RUC is reduced.
By the amount of DRS that is procured by ERCOT. So um
if the Commission decides to conduct this, this additional
evaluation. I think we should do it 66 months out after
DRS is implemented. And or the subject of discussion
a year out. Because ultimately, we need to keep tabs
on whether or not this ORDC price floor adder um
measure is actually working, right? So we'll have the
first step will be the report that's due November
1, 2024. We'll get an accounting of this data and
be able to um get, get some more information. On whether
or not it's meeting its intended purpose. Uh but also
as we implement DRS, if you know, make sure that we're
understanding how the two are interacting with each
other. And whether or not we still continue to need
the price for adder. I just think that we just have to
have accountability measures to ensure that. Um, we're
being good stewards of, of um, you know, ratepayer
money. But also ensuring that we um, are accomplishing
what we set out to do.
(item:21:Commissioner McAdams' thoughts on memo) So um I filed a memo uh relating to this policy.
I think you uh, you will know my position on it. Um
I'm gonna hold fire uh on, on further comments. But
I, I want to hear from the other Commissioners that
haven't voiced uh, opinions on it yet. And then, and
and I'd like to follow up uh with a clarification
of intent. And, and I am in alignment with you, Commissioner
Cobos. Um love to hear any other thoughts. So um,
uh. (item:21:Commissioner Glotfelty's thoughts on the memo) I, I struggle with this. Um I know the uh, the
TAC and ERCOT and uh ERCOT Board. Have all uh requested
that we move in this direction and approve this. Um
the um it's not clear to me that we are creating
a bridge solution to eliminate RUC. Or we're creating
a bridge solution to bridge us to a, a um a reliability
capacity issue. To solve our resource adequacy issue.
Um and I think this came up, this bridge came up. As
a discussion about resource adequacy. Not as an elimination
of RUC.
Um Commissioner McAdams, you may disagree with
me. But uh I, I what I want is um, if we
want to eliminate RUC. I think we should be looking at
all of the solutions that could eliminate RUC. Not
just one. And um I, I know RUC is problematic for generators.
But what I don't want is another out of market solution
to solve an out of market solution that we created.
Which solved a conservative operation out of market
solution that we created. Um I feel like we're just
piling on by and trying to fix the market with other
modifications. And um and I think that as we continue
to look at the ancillary services out there. Which
were we, were required under uh, uh Senate Bill 3. To look at
ancillary services. I think we have not really done
that and would suggest that we really take a look at
that, which would encompass this. So my, my um my only
comfort in this is that. If we do really look at ancillary
services, it will encompass what's happening with this
ORDC floor. And if in fact, we realize that this is
not working for its intended effect. Then we have to
redo and relook at ancillary services as an entire market.
All of the tools at once. Um because adding tools,
um I think with resource adequacy as a goal, it's creating
uncertainties. We don't want to create uncertainties.
Me saying that we should, we should do this and then
look at it in the future is creating an uncertainty
to understand. But we have to, we have to find a way
to create certainty in this market. And allow investment
to happen. Um the only other, you know, issue that
I have, um, and I say this as the ability to eliminate
RUC. I know this issue has been brought up at ERCOT.
And that is if we, if we just prohibit the opting
out of RUC, does that incent or induce self commitment
in a easier cleaner way? And I don't know the answer
to that again. I know that they've had these discussions
at ERCOT within the stakeholder process. But I think
that should be an issue in the future. That is on the
table for discussion. If in fact this option doesn't
solve the reliability unit commitment issue. And so
to that end, I'm tentatively supportive of the effort
you have my vote. But this ORDC uh I, I in
fact. I, I went back and I looked at um the uh,
uh some of the reasons for the ORDC. And there was
a, an IMM um presentation uh in 2017 or 2019. That was
uh that ORDC was actually being implemented um instead
of real time co-optimization.
And that, and that. At some point in time when RTC
gets approved and finally in the market. That is another
signal that we have to look at this ORDC, and its
role in the market. Because just throwing money into
the market when the reserves get tighter is not necessarily
a solution we have seen, it might be in the future.
But we have seen it is not necessarily a solution to
put more steel in the ground. So with that I, I would
say that I'm supportive of this effort of this bridge.
That I reserve the right to say that it ain't going
to work. I'm not sure it will, but I think we have
to move forward and create some certainty as best as
we can. (item:21:Commissioner Cobos' follow-up on memo) So I want to say a few things. One is
Commissioner Glotfelty, I really appreciate you raising
all your concerns. And those are, you know, they're
all valid. I think the first one, what is the goal
of this, this um this near term bridge solution? I
think, you know, we had a very robust discussion at
our workshops about what the near term solution was
intended to do. Um you know the, the few of us pounded
you know, the table on any (inaudible) to reduce RUC. But unfortunately
in the blueprint the, the wording was very
broad. And I believe ultimately when it arrived at ERCOT
it turned into a resource adequacy solution. When it
left here as a RUC reduction solution. So I think what
we need to do is reset and, and say what is it
intended to do? And I think there's agreement here.
that what we're trying to do here is retain our long
duration thermal dispatchable, thermal generation assets.
And uh reducing RUC and naturally the ORDC price floor
adders are going to put more money in the market. How
much ultimately that is, you know, that's subject to
debate, right? I mean based on market behavior, we
could be um less than what our projected. Um And so
we have to monitor that right? As, as you know we
go forward. But naturally it is going to provide more
money in the market. That should help retain provide
should help cover the marginal cost of existing generation.
And hopefully would, you know, uh yet another revenue
stream to our market where generators can go and look
at a portfolio of revenue streams. To make a decision
on whether they want to invest in our market. And because
I don't believe it's one mechanism that's a driver
of investment in our market. It's a portfolio of revenue
streams. And so this is yet another piece uh another
addition to the portfolio. So it, it you know well
I continue to believe it's not a resource adequacy
measure. Um and more of a um RUC you know uh, uh
more of a, a measure to um take the physical pressure
off our long duration. Especially older generation
units and reduce RUC and through a market based tool.
Ultimately it will, you know, have some revenue impact
right? I mean naturally it's the ORDC's. Uh second
um on the auto market solution to address the out of
market solution and we, you know, I view it a little
bit different. Um I I believe that the ORDC is an
in market, market based tool. That is um was developed
by the Commission to um incent price responsive behavior.
And uh more appropriately value uh reserve, reserves
as um we are in scarcity conditions as those reserves
become more scarce. So I believe the ORDC is an in
market, market based tool. However, the um addition
of the ORDC price floor adders are certainly administrative
changes and actions that um ERCOT would be putting
in place. Third, I understand your point on kind of
unpacking and, and you know, not pancaking. Um ultimately
that's why I want these metrics in there. Because even
though they're isolated metrics on where, how much
money is the are the ORDC price force producing? Where
is it going? Is it reducing RUC? You know we, we got
to track those metrics, but there are other factors
in our market. That will, that will impact whether or
not these ORDC price for adders work as intended.
And like you mentioned, ancillary services. You know
the more power you reserve, the more is less available
for real time operation dispatch. And more scarcity
and, and potentially more use of the ORDC. But there
there's a, a direct interact, direct correlation between
those two markets. You know, with real time and day
ahead market and, and how much ancillary services you're
reserving? And, and we do have to be diligent about
the ancillary service portfolio. And, and ensuring
that um we're buying what we need going forward. Obviously
we have a lot of, a lot of renewables on the system.
And a lot more coming and you know, our market and
grid is evolving. But we wanna make sure that when
we um go to the drawing board with, with our counterparts
ERCOT. Who ultimately approves these annual, the annual
ancillary service methodology. That we roll up our sleeves
all together and we make, make sure that we're doing
what's best for the market going forward on the Ancillary
service portfolio basis. So I understand your point
there. Um but ultimately I think um I appreciate your
support. And, and those are just some responses I wanted
to provide to clarify and hopefully um add more to
the discussion. (item:21:Commissioner Glotfelty's comments on ORDC as a market solution) The, the only thing that I would uh
come back and say is. I agree with you ORDC was
implemented as a market solution but modifications
to that market solution Uh seem uh as we've moved the
standard deviation as we've done a lot of different
things. Those are our actions, that's not the market
functioning. It's the market functioning to what we
are doing, which is putting more money into the market
for a reason that we have chosen so. Administratively.
(item:21:Commissioner McAdams on clarity of purpose) And that gets to the issue of clarity of purpose. There
was insufficient clarity of purpose on each one of
the ORDC modifications. Uh and that's the goal, the
mission, the clarity of the goal. Where do you want
to get to? And it was based on resource adequacy and
meeting some nebulous definition of resource adequacy.
Which has never been clearly defined. Nor is it defined
in any other place in the country right now. And we're,
we're seeing that. Um it was, it was pitched. It was
sold um to the Legislature, to the Commission. That it
would drive uh installation of new capacity into the
system, for which it is not done to date. Um but it
could do uh theoretically. But what we're discussing
here is not that. These are not revenues um introduced
into the market to um maintain or in, in order to achieve
key distinction, to achieve resource adequacy. What,
what they are designed to do is to induce self commitment
and market driven behavior into the market. So that
we can maintain our conservative uh operations. Stay
out of conservation alerts, not unduly alarm the public
or degrade confidence in the system. And in order to
retain the generation that we have today. Stabilize
the system and then start working toward a long term
solution. And the bridge is a bridge to the statutory
framework that is now in law, which is DRRS. And DRRS
is specifically designed and required to reduce RUCing.
And I would like to say something about RUCing. We're
not talking about all RUCing, we're talking about
capacity driven RUCs. Not for congestion and there
is a distinction. So when we start accounting for this
I want to see a reduction in capacity driven RUCs. Not necessarily
congestion driven RUCs which are a real time reliability
uh a constraint on the system. And you have to, have
emergency mechanisms available to the system operator
to manage through those constraints. And so I, I
believe in, in terms of a mission on the part of the
Commission. This, this uh mechanism that we are considering
today is specifically designed to maintain levels of
current uh generation and reduce uh the RUCing for capacity.
Which is an out of market action by the system operator.
Which is linked to the amount of uh, uh conservative
operations. Uh renewable penetration into the system
and ancillary procurement um we need to see reduction.
And as a result Commissioner Cobos' memo lays out a
road map. To um to a series of touch points, checkpoints.
Where this Commission should automatically initiate
evaluations of its success on that very narrow and
clearly defined mission. And uh and if it is not working
it should go away. And the market should know that and
they should see that coming well in advance. And so
I think um the, the clear line that we cross when DRRS
launches is the first such checkpoint. And uh we need
to see a testing period of DRRS. Because right now DRRS
will take some time to uh accomplish its intended purpose.
And so that, that includes seeing it perform in a shoulder
season and a peak season, you should see how it interacts
with the system. And then um, we should evaluate adamantly
evaluate the success of ORDC. And potentially how this
this minimum, uh adder mechanism could be phased out
due to the success of DRRS in accomplishing its mission.
(item:21:Chairwoman Jackson's thoughts on memo) So, lots of discussion. I think what I'm hearing though
is that we are in consensus in terms of moving forward
with um, with the resolution. And I think as stated
in Commissioner Cobos memo and then
touched on by, you know, the other two Commissioners
here. In terms of the value and the need for the metrics.
And the fact that you know with, with any uh with
any change moving forward. It is incumbent on us to
measure that success and determine along the way whether
there needs to be change. Based on its performance in
the vein of continuous improvement. And so you've,
you've laid that out in your memo. I know that, that
you know, you had had a memo and you, you talked about
the metrics. And so, you know, is this, is this what
Staff kind of envisioned in terms of the metrics. That,
that you were talking about? This is exactly the guidance we were looking
for. Yes. Okay, and I think ERCOT um. I, I do have a
question. Harika, do you um do you know how much this
floor is intended to put in the market? I mean, is
there a number that's tied to that, that is based upon
a past study or a past model run? Yes, I believe it
was tied to around $500 million, $500 million. So I,
I just want to say again I'm, I'm on board with this.
But I do not believe $500 million in this market is
going to keep a unit operating in this market or in
sent new generation in this market. There are too many
other variables that are going on in the face of this
dynamic market. To allow that much money for long duration
high capital cost resources. Do you think
because that's what we're trying to achieve. Can we
do? I, I don't know. I mean I don't think that we
are the ones, I don't think this will uh will uh will
a generator be happy that we're doing this for a year
But in conjunction with other mechanisms, again, this
is a framework. I don't, I don't know, I act in concert
not alone. And that's an important consideration. I
don't know the answer to that. I don't think generators
based upon our Load growth are going to go away. So
I think it's hard to tell if it's, if it's this money
or if it is high prices in the market. I think but
my point is that we, this ORDC, since 2014. Has put
in over $12 billion into the market. Um Some years
lower than others. We are going to continue to see
this issue, the more renewables we have, the more money
is going to have to be put on some capacity function
Uh The PCM, the DRRS I don't know what it is.
You know but um. By the way, that's a big number. So
everybody do the math correctly. Including the press
That's over nine years. It's, uh it's since 2014. That's
right. And um, you know, average, it's, it's pretty
low but it's uh in some years it can be high. Um
And, and I'm not saying that number is wrong. Um I
I think the the reality is. The more you have zero cost
resources, zero marginal cost resources in the market
the higher we're going to have to provide resources
to those that have high operating costs. If we want
reliability, those are the resources we need for the
blue sky days. Those are the ones that we need for
the reliability of long term winter events that we
it's buying insurance is what it is. But I just, I
want you all to know that, you know, without this big
vision of where we're going. I think it's hard for
us to keep determining what success will be with all
of these little modifications and that I really encourage
us and Acott to undertake a longer term view of Ancillary
services at some point in time here in the fairly near
future. Um Once we get some data from this. And uh
and we, we go forward, I feel like I'm back in A
R it's conditions dependent. Um It is what it is and
and you're gonna say, feel like you're back in the
legislature. No. Um success is conditions dependent
and you know it when you get there or you feel it
and right now we are not there. And uh I know you
have thought. Yeah. (item:21:Commissioner Cobos' comments on incentives) Well, I mean, I just want to reiterate
that, I don't believe that this one action is gonna
be the monumental action. That's gonna drive, retain
or incent investment. It's one piece of a broad portfolio
of revenue streams in our market. And we've, you know
to your point about how much money the ORDC has put
in the market. I mean, we've put incentives in the
market. We, we can't make the market invest, right?
We can't make generators invest. That we've put in,
we've put money in the market. There has been some
investment as a result of the ORDC. And um you know
this is yet another administrative action that the
Commission is taking that will result in more money
in the market, but is ultimately trying to get these
generators to self commit. And if they don't self commit
and it doesn't work, then we have another problem and
we have to address it in another way. And we'll see
that and we'll see that. So and, and I think
(item:21:Commissioner McAdams on defining mission and goals) Um I think one of the important features of this is
through our clearly defining the mission and the goal.
We are building in an a, a means of accountability
into the ORDC. Which previously the Commission had
not addressed. We are, we are obligating uh this Commission
or future Commissions to check in on this to make sure
that it is accomplishing the desired effect. Um And
and the stakeholders will provide information. The
IMM will provide information on to verify whether this
is in fact working. And ERCOT as well, but this is not
a fire and forget tool. This is something that we got
to track and see if it's if, if it's providing the
desired effect for the system. (item:21:Commissioner Cobos' comments on building appropriately for the future) And as we build for
the future we, we need to start like Commissioner
Glotfelty has said unpacking some things, and looking
at things and having metrics. So that we are building
appropriately for the future and not just, you know
pancaking things on without doing a holistic, a thorough
evaluation. How everything interacts with each other
to your point on ancillary services. We, we we've got
some work to do to plan forward on the statutory framework
in 1500. But also incumbent on us and ERCOT. To really
take a deep dive into how, you know what, how we're
gonna set up going forward. So that the measures that
we put in place as a result of 1500 do work as
intended. (item:21:Chairwoman Jackson's comments on reliability) Well, I think we're still, the North Star
is still reliability. And I think we all recognize
that it's not, it's not one big answer. It's a lot
of answers and everything interconnects. And um, and
what we want is, you know, what is in the best interest
of the consumer, which is reliability. And also, you
know, the lowest cost possible. And that it's going
to take, you know, thoughtful and deliberate action
to get there based on good science and good data. And
so you know in my mind, I see this as a very
important step. And something that kind of again demonstrates
that we are in fact moving forward. And that we are
concerned about not just the long term but also the
near term. And that one action builds on another and
you know, having this thoughtful oversight, having
metrics clearly delineated. And knowing ahead of time
this is what we're going to gather. The data here is
at least initially what we're going to evaluate its
performance based on. And that it interacts and engages
with all of the other actions that we need to be taking
moving forward so. Madam Chair, before we move on. You
just to have a good uh agreement from the Commission.
We are talking about reduction in capacity driven RUCs,
correct not transmission? Yes. Okay. I just wanted to make
sure that was in the record. To clearly define, you
know, what we want to see. That's what I.
Okay. (item:21:Motion to approve ERCOT's Board of Director's resolution) Well, do I have a motion to approve ERCOT's Board
of Director's resolution included as Attachment A in
ERCOT's report and recommend, recommendation on Bridge
Solutions filed on, on April 20 2023. Require reporting
metrics consistent with our discussion and direct Staff
to file a me memorializing this decision. So moved.
Second. I have a motion and second. All in favor, say
aye. Aye. Motion passes. It's a good Commission.
Thank you Harika. Uh I don't have anything on Items 22 or
26, unless y'all do? (item:27: Chairwoman Jackson lays out Project No. 41210) Next up is Item No. 27, Project
No. 41210. Commissioner McAdams who filed a memo
um could you please walk us through? Thank you, Madam
Chair. (item:27:Commissioner McAdams' lays out his memo on SPP) Um the purpose of my memo was one I, I promised
a more comprehensive report at our last open meeting.
On the activities and efforts currently underway at
uh the Southwest Power Pool. I wanted to highlight
key projects uh that SPP has launched. Where um we as
a state Texas will need to engage uh over the next
two years. Um as seen in my memo SPP, uh intends to
grow into the West um uh across the Rockies. Um and
they intend to file um this new expansive plan, a plan
of approval with the FERC by next year 2024. Um and
over the next two years, uh once they gain that approval
from FERC. We will be engaged in uh governance related
discussions. Around um how the, the two halves of the
system, the East and the West will work together, right?
Now they're contemplating two separate balancing authority
areas um interconnected by uh existing and potentially
future uh DC ties. Um As, as I said in the memo
Colorado is a major uh loads center which will be uh
coming in. Um This, this is gonna afford us the opportunity
to talk about governance. And how cost allocation in
my view, especially as it relates to um interregional
uh transfer capacity. Um Upgrades is debated and ultimately
settled upon with SPP. As you know, uh Texas is a major
has a major loaded ratio share uh within the footprint.
And uh so we want to make sure that it is equitably
and fairly um portioned within the ISO/RTO. So, uh
I also want to highlight uh I mentioned RAMP. Um uh
and RAMP accreditation. That is a policy that the real
team has taken on in conjunction with other stakeholder
driven uh groups at Southwest Power Pool. Ramp capabilities
are becoming a more acute um uh challenge to achieve
in all of the uh ISOs. Um it's very valuable to
have RAMP capabilities. In a system where variable uh
energy is, is becomes the dominant energy source: ie
uh solar and wind. You need a certain threshold of
RAMP capacity to meet the challenges of falloffs and
wind and the daily um uh rising of the sun and setting
of the sun. This is a more challenging topic. It's
very complicated. It's requiring a lot of analysis
with SPP. What's on your chart is shifting by the moment
in terms of our evaluation of a new policy. To include
a separate accreditation or RAMP capabilities inside
of their capacity obligations. You'll see on your chart
that it's currently slated for some type of policy
deliverable by January, I believe of 2024. That's going
to shift to the right a bit,
that's gonna shift to the right a bit. And um and it's
because through the uh work that is currently underway
at SPP. We're starting to prioritize um various projects
depending on the near term needs of the system. And
that is uh, uh very much dependent on some of these
other steps that we're currently reviewing. And uh
that includes the performance based accreditation and
the expected Load carrying capability evaluation uh
within the system. We hope to have a policy construct
before the board of directors in RSC in October. The
uh, uh SAWG the uh system uh Adequacy Working Group. Um
has a recommendation that they've been working on in
partnership with the REAL team which uh Texas leads.
Um to accredit facilities based on their actual performance
and that accreditation is gonna perform the foundation
of capacity obligations in the future. As such as a
part of this recommendation, it also accounts for fuel
security. So similar to what uh ERCOT has done inside
of uh in, in Texas.
SPP is approaching fuel security through an accreditation
construct. So it will receive, if you have firm fuel
contracts or on site fuel storage. You will in fact
receive a higher degree of accreditation moving forward.
And thus there's value there to offset your capacity
obligations. Um And, and all of this is apples to oranges
because you're dealing with vertically integrated monopolies
um in, in SPP. Whereas in ERCOT it's completely competitive.
So that's the distinction, but we have high hopes for
ELCC and PBA. Um This is going to provide uh the
foundation for where we move next. As you see on your
charts in 2023 and 2024. Um
So, um
you have also seen in my memo that we have imposed
an actual capacity obligation, a financial capacity
obligation for the Winter season. And this is a first
for South, Southwest Power Pool. Other regions including
so have applied seasonal capacity obligations. Now
SPP has one as of our most recent board meeting last
week. Uh The, the issue with the level of the current
capacity obligation is it's very low for Winter and
there is broad based recognition, recognition within
several ISOs that Winter is the new problem. It is
not summer gross Load that we are targeting more. But
it's those Winter months for which the system has not
been designed uh over the last century. And as a result
the probable appropriate level of capacity uh for which
uh these utilities must meet is probably much higher.
And I've discussed this in, in past um uh updates than
it currently is and it currently sits at 15%. Because
we just took the, the obligation of Summer and applied
it to Winter. Um But in order to evaluate what the
appropriate level is. We must first overcome other
policy decisions. Namely, we must evaluate how outages
are uh planned outages are accounted for during Winter
seasons. And this is becoming uh a real um point of
strain within the governing, governing Council of Regulators
at SPP. Because the Northern states are much more susceptible
to extreme cold than, than the Southern states are.
And as a result, they are acutely aware of how uh planned
outages can impact their ability to meet a capacity
obligation. So they want the rules of the road established
um and delineated on how, how those are are accounted
for. And that has become one of our key priorities
on the part of REAL team and the stakeholder work groups.
Is to delineate how we can do that once that is accomplished.
And you see that uh in January of 2024.
Once that is accomplished, the REAL team and the SPP
will then take on a more comprehensive look of the
cadence of capacity uh evaluations. We will look at
a more enhanced threshold for the Winter season at
that point because it'll be more uh accurate. And therefore
we'll know what uh what capacity we need to satisfy
a reliability standard. And the reliability standard
is probably strategically the most important thing
that um the system will establish next Spring. And
that includes uh an evaluation of an a expected unserved
energy based reliability standard. Uh which will be
determined based upon an evaluation of value of lost
Load as well within the system. Which is uh a, a value
of lost Load study will be moving concurrent to our
uh analysis of EUE driven metrics. And all of this
should sound familiar to you because that's exactly
what we're doing in the ERCOT system. And that evaluation
should line up almost in parallel with when we're making
key decisions in ERCOT. So I'll keep you informed in
terms of the results of those studies and how we are
in alignment regionally over the coming months. So
all this to say, um there's a lot of heavy lift in
strategic decisions that are on order in the SPP footprint
over the next year. And uh, uh we're, we're making good
progress. But I think it, these little check-ins with
the Texas Commission are appropriate. So that um we
can proceed eyes wide open on everything that we're
doing for both ERCOT, MISO and the SPP. Happy to answer
your question. (item:27:Commissioner Cobos' comments on SPP overview) Commission McAdams, thank you for
that overview. And a lot of it does sound familiar in
ERCOT but also in MISO, as you noted. Um, with respect to
the vol study that um, SPP is currently conducting. I
know you've been a strong proponent of the customer
survey aspect of the vol study. Is SPP conducting a customer
survey as part of their vol study?
(item:27:Commissioner McAdams' follow-up response to Commissioner Cobos) Well, there's been concerns about that. But um after
repeated uh 9 hour meetings of the REAL team and
discussions before the Board of Directors and RSC.
I believe there is a commitment to conduct a consumer
facing vol study. Okay. Um and do you know how they'll
proceed forward? Are they gonna hire an independent
consultant? Will it be done internally through SPP
Staff? Uh no, it is not gonna be uh done internally
through SPP Staff. There are several partnerships that
are currently underway. Um Berkeley National Labs is
already conducting uh consumer facing outreach on a
regional basis. And I believe that is also being uh
tied in with potential ERCOT efforts. Through now our
um I don't wanna make anything public before everybody's
ready. But I believe ERCOT may have settled on some
type of framework um not ready for announcement yet.
But Berkeley National Labs is conducting regional analysis.
Which will help tie into the settled upon contractor
and a path forward for SPP and potentially ERCOT as well.
(item:27:Commissioner Cobos on gaining ideas from other markets) Great. Okay. Yes. So, and I think that's important to
know. As we, you know, work on all these different market
issues outside of ERCOT. Is what other markets are doing?
Everybody's looking at planning for the future, establishing
a reliability standard to account for our evolving
resource mix nationally. And um we can all borrow,
borrow great ideas and frameworks from each other on
how to proceed forward. As I think, you know, is looking
at their reliability standard. Right. Um, and SPP is looking
at theirs and of course we we're all very familiar
with ERCOT's work on theirs. And um there's a framework
that can be borrowed from SPP and other markets on
how to proceed forward. With having a robust vol study
I think it's, it's important to, to, for the ISO and
RTOs. To, to communicate with each other. (item:27:Commissioner McAdams on regional consistency) One of the
conclusions that's coming out of the, the discussion
around vol is. Man, it's got a lot of good uses if
you can have a good detailed study or settled upon
some type of um
methodology around vol. That has some type of regional
consistency and consensus from stakeholders. You can
that helps set the value of scarcity. Which can drive
market driven behavior even amongst a, a grouping of
vertically integrated monopolies. Because again, the
whole point of the ISOs/RTOs is to incent trade
among them. And, and especially um an SPP who's gonna
be trading now with uh SPP West and MISO. Because that's
part of the Federal vision for this system. Um ERCOT
it jeez it could have any number of positive uh uses.
Just because of the competitive nature of the system.
So no I we there are high hopes for vol. It, it
takes a certain amount of convincing people to take
the leap of actually engaging with consumers. They
are terrified of consumers. And uh rightly so, I mean
we're subject to that too. But um, I think it's going
to benefit all the systems if we do this right.
(item:27:Commissioner McAdams on SPP going to the West) How far do you think uh, uh SP is gonna try to
push in the West? Oh, They wanna go to the Pacific.
They, they wanna go to the Pacific and uh so the map
will continue to grow. Um It's heavily dependent on
actions taken by Cal ISO. Um in trying to set up their
own RTO/ISO uh and competing markets. Markets plus
is already well established and has broad based participation.
Um Governance is a key uh stumbling block in terms
of CAL ISOs ambitions uh to secure the Western part
of the US, especially West of the Sierras. Um but SPP
has visions of a broad based balancing authority that
goes all the way to Washington and Oregon. And um and
they're actively engaged in convincing those Commissions,
state regulators and utilities. That it can be effectively
managed. And um for my part, I'm more of a uh iterative
incremental phased approach kind of guy. And uh but
the East, no matter what will be secure. As from a resource
adequacy and reliability standpoint, the West is gonna
be um something to watch over the next decade.
Well, I think we found that uh we've seen these
uh, RTOs continue to grow and grow and grow and grow.
And it's not always good, it's not always easy. But
uh, we're going to continue to see them fight for territory.
They all just want the land that's attached to theirs.
So it's going to be never ending until it gets to the
Pacific. And then, and then uh Hawaii. And then there's
Japan. Yeah.
Alaska. Okay. Uh, I don't have anything for Items 28, 29,
or 30, unless y'all do? Uh, items, 31 and 32 were Consented.
Uh, I don't have anything for Item uh, 33. (item:34:Thomas Gleeson, PUC Executive Director on Steven Journeay's retirement) Um, next
we'll take up Item 34, our Standing Item for Agency
Administration Issues. Thomas has an update. Thank
you, Madam Chair. Good morning, Commissioners. Um, just
one Item this morning. I'm holding in my hand something
that I knew was coming but didn't know exactly when.
It is a uh, notice of retirement for Stephen Journeay.
Um so we, we've been asked what we're gonna do. Steven
doesn't want to do anything to celebrate. I know he
left before I could talk about it.
He, he doesn't want to do anything. So of course,
that means we're going to hold a Steven Journeay Celebration
Day on August 10, a week from today at 10 am in
this room. Because of capacity limitations, we're gonna
ask that, that be uh only former PUC Staff. So alumni
of the PUC will hold something else. I'm sure the festivities
will continue beyond that morning. Uh, somewhere else
perhaps at Schultz's. Um that, that we can have a
larger crowd out, crowd at. But we're gonna hold that
event here. Um I've, I've asked some special guests
to come back and, and say a few words about Steven.
And uh, you know, he's been here since 1996. And I've
told people often that he, he's the equivalent of a
human uh you know city limit sign. When you're, when
you see him you, you know where you are. And so, uh
just wanted to put that out publicly for all the former
PUC Staff that will be holding that at 10 am next
Thursday uh in this room. Okay, thank you. Um I don't
have anything for items 35 or 36. (item:37:Chairwoman Jackson pauses Open Meeting, to hold Closed Session) This brings us to
Item No. 37, Closed Session. Having convened in a
duly noticed Open Meeting. The Commission will now
at 10:50 on August 3, 2023, hold a Closed Session.
Pursuant to Chapter 551 of the Texas Government Code
sections 551.071, 551.074 and 551.076. Uh we'll be
back in a few minutes. Thank you. (item:37:Chairwoman Jackson concludes Closed Session, Public Meeting resumed) The Closed Session
is hereby concluded at 11:02 am on August 3, 2023.
and the Commission will resume its Public Meeting.
(item:37:Chairwoman Jackson states Commission takes no action concerning Closed Session and adjourns meeting) The Commission will take no action as a result of Closed
Session deliberations. There being no further business
to come before the Commission. This meeting of the
Public Utility Commission of Texas is hereby adjourned
at 11:02 am