Legislation is on the table that would expand use of programs that incentivize customers to use less power during high demand times.
Some Texas legislators are pushing a bill that would help conserve electricity through increased use of demand response programs in the state.
House Bill 3343, authored by Rep. Sylvester Turner, D-Houston, directs the Electric Reliability Council of Texas (ERCOT) – which manages the state’s energy grid – to promote the development of demand response participation in electricity markets. SB 1284, a companion bill sponsored by Sen. Kirk Watson, D-Austin, is also under consideration in the Senate.
Demand response programs reward users who agree to dial back use of air conditioners and other systems that require high levels of power during peak times. Paul Wattles, senior analyst for ERCOT, told The Texas Tribune that approximately 12 percent of the grid’s retail electric market has a form of demand response incentive.
For Turner, demand response is a low cost means to address the need for resource adequacy. “Encouraging the growth of voluntary demand response could potentially provide cost savings and avoid the prospect of involuntary rolling outages,” he said in a statement.
Jon Wellinghoff, former chairman of the Federal Energy Regulatory Commission, noted in an interview with The Tribune that Texas could potentially triple how much it saves through demand response.
While cost-savings and keeping the lights on are obviously benefits of the plan, the electric industry in Texas is skeptical of the measures. The Association of Electric Companies of Texas (AECT), which represents most of the state’s major electric providers, believes the legislation undermines the market and provides an unfair advantage for those providers offering demand response programs.
Government Technology contacted AECT President John Fainter about the organization’s opposition to increased demand response use, but was told that because negotiations with the bills’ authors are ongoing, he was unavailable for comment.
“Because of sensitive discussions with Rep. Turner and others regarding possible changes to the proposed demand response legislation, Mr. Fainter believes it is best he not try to respond to your detailed questions,” said Bruce Hight, AECT spokesman, in an email.
Alison Brock, chief of staff for Turner, told Government Technology “there is quite a bit of opposition” to HB 3343, and confirmed that Turner was working with stakeholders to tweak the measure and get it through the legislative process.
In an email to Government Technology, Watson said he expects to make similar changes to SB 1284.
“The bill may need to be modified in order to address concerns from various interests,” he said. “I am hopeful that there is room to address the concerns of those who may be opposed to the bill as filed, and still make progress for demand response this session.”
At press time on April 17, HB 3343 was pending in the House Committee on State Affairs. SB 1284 was assigned to the Senate Committee on Natural Resources & Economic Development.