Austin, Texas, is struggling to close a coal-fired power plant that its city council ordered to shut down years ago, The Texas Tribune reported Monday.
In 2020, the city green-lit a plan to close the Fayette coal plant [pictured], located in La Grange, Texas, by 2022, but economic, legal, and technical hurdles have enabled it to stay open despite the green energy goals of the city’s elected politicians, who are overwhelmingly Democrats despite Texas’ reputation as a Republican-dominated state, according to The Texas Tribune.
Increasing power demand in Texas and changes to the state’s market are helping to make coal-generated power and electricity even more financially appealing.
Austin Energy, the company that co-owns the Fayette plant, made about $11 million on the plant on Aug. 17 alone as demand spiked amid an unrelenting heat wave, according to The Texas Tribune.
A large reason for this profitability is that the Electric Reliability Council of Texas (ERCOT), the state’s grid operator, recently altered its market model to provide incentives to companies like Austin Energy to develop ancillary services, which are sources of energy that set aside some of their capacity to be ready to quickly add supply into the grid when needed.
“ERCOT does pay market participants who provide ancillary services, which are reserves to support grid reliability,” an ERCOT spokesperson told the Daily Caller News Foundation.
“ERCOT is required to procure ancillary services each day on behalf of Texas consumers, and does so through a competitive bidding process,” the spokesperson continued, adding that “any qualified generator or load may bid in, and the services are awarded at least cost to consumers” and that “ERCOT does not award ancillary services based on the generator or load type.”
Coal power is well-suited for this system, as it can be put online relatively quickly and dependably to provide energy to the grid in situations that see demand threaten available supply, according to The Texas Tribune.
This summer, as a heat wave baked the state, ancillary services were put to use on particularly hot days as the sun was going down and solar power’s energy production dropped, Michael Enger, the director of Energy and Market Operations for Austin Energy, told The Texas Tribune.
High power prices affect Austin Energy on both ends of its business, as it also is responsible for buying power to produce for the city, even while the Fayette plant may be raking in millions of dollars, according to The Texas Tribune.
The company’s revenues from selling power to the city’s grid allow it to cover costs, fund municipal services and keep rates lower for customers in the area.
“Not having [the coal plant’s] revenues to offset costs would mean those millions of dollars would be passed through to Austin Energy customers,” an Austin Energy spokesperson told The Texas Tribune.
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Anyone who thinks the Democrats is going to create Jobs for everyone are the same ones who vote for Biden and before that Clinton(Bill)and Obama
At least someone somewhere took into account higher electricity rates to consumers before shutting down a very efficient power producer.
Kudo’s to them.
California should try that sometime.