Texas Legislative and Market Update 10/2024
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- לפני 9 שעות
- זמן קריאה 7 דקות
Virtual currency mining registration
The Public Utility Commission of Texas (Commission) proposed a new rule that would require certain virtual currency mining facilities to register with the Commission. Under the proposed rule, a person operating a virtual currency mining facility must register the facility as a large flexible load, if its load is greater than 75 megawatts (MW) and its interruptible load is 10 percent, or more, of the actual or anticipated annual peak demand of the facility.
If a virtual currency mining facility began receiving retail electricity services prior to the effective date of the rule, the facility’s operator must register the facility with the Commission no later than Feb.1, 2025 and renew its registration by March 1 of each calendar year. However, people operating virtual currency mining facilities that meet the proposed rule’s requirements and become operational after the effective date of the proposed rule would be required to register the facility with the Commission no later than one working day after the facility begins receiving retail electric service.
The Commission’s proposed rule is a result of the Texas Legislature’s adoption of section 39.360 of the Public Utility Regulatory Act (PURA)1 during the 2023 session of Legislature. Among other things, the rule requires registrants to provide:
The registrant’s legal business name
The name of its corporate parents
The name of its principals
All business names of the registrant
The virtual currency mining facility’s demand for electricity
The anticipated peak electric demand from the facility for each year of the five-year period beginning on the date of the facility’s registration
The percentage of the load that is interruptible
The actual peak load and total power consumption for the prior calendar year
Whether the facility has on-site backup generation and the nameplate capacity of such backup generation.
Following the proposed rule’s adoption, an operator of a virtual currency mining facility may be subject to administrative penalties for failing to register a facility with the Commission.
The ERCOT Large Flexible Load Task Force (LFLTF) meeting on July 8, 2024.
An update on the Large Load Queue, highlighting a significant increase in total queue capacity by 4,196 MW from June 2023 to July 2024. This expansion now includes projects with projected in-service dates extending as far as 2028, with default in-service dates of December 31, 2028, assigned to projects lacking specific dates. Since July 2023, 1,735 MW of load has been approved to energize. This reflects a slight decrease from previous figures due to updates and cancellations. The load breakdown by zones shows 2,837 MW in the west load zone and 2,642 MW distributed among the north, south, and Houston load zones. The total comprises 4,404 MW from standalone projects and 1,075 MW from co-located projects. Peak consumption details include a non-simultaneous peak of 3,065 MW and a simultaneous peak of 2,610 MW. There was a need for further clarification on large loads not displayed due to ERCOT’s intermarket notice, and discussions focused on improving projections of connected loads for policymakers. There is also a call for more detailed reporting requirements to better track the readiness and equipment delivery dates.
The topic of Voluntary Registration of Loads was discussed, addressing concerns about large flexible loads impacting load obligations during coincident peak periods and manual load shed events. A proposal was made to exclude large flexible loads from transmission load shed obligations if they disconnect before Energy Emergency Alerts (EEA) or EEA Level 1 events. Coordination with ERCOT on drafting NPRR1238 and NOGRR265 was highlighted, with an urgent status requested due to project delays. Stakeholder concerns were discussed, including the specificity of the proposed language and its potential broader applications. Questions regarding NOGRR268’s language, minimum size requirements, and implications for system changes were addressed. Issues were also raised about notification and responsibility for changes in system topology or telemetry. There was a strong emphasis on effectively managing the registration and deployment of curtailable loads. ERCOT continued to review the proposal and expressed reservations about its urgency, leading to further discussions on aligning the proposal with regulatory requirements.
The meeting also introduced a proposal for setting maximum size limits on load interconnections. This included defining minimum and maximum sizes for radial connections across several categories: less than 350 MW, 350 MW to less than 700 MW, 700 MW to less than 1 GW, and greater than or equal to 1 GW. Recent trends have included requests for very large load connections up to 4 GW, highlighting the need for new criteria as current standards are lacking. Attendees discussed studies such as those by Southern Cross, which evaluated the frequency and voltage impacts of large loads. Comments included a call for more rigorous studies based on frequency overshoot, the importance of considering co-located generation and load facilities, and the need for practical and reliable solutions. There were concerns about substation selection and coordination between multiple Transmission Service Providers (TSPs). The consensus was to conduct further studies and potentially establish new criteria to handle voltage ride-through and system stability for large load
ERCOT LOAD forecast
Texas load growth forecasts for 2030 have soared by 40 GW in a single year, necessitating “a new era of planning,” Electric Reliability Council of Texas President and CEO Pablo Vegas said Tuesday at a meeting of the grid operator’s board of directors.
The ERCOT region is forecasted to experience tremendous electric demand growth in the next 5-7 years, which is driving the need for ERCOT to adapt and plan differently for the future. As a result, ERCOT is adapting and entering a new era of planning to address long-term challenges and highlight future opportunities.
.The growth is coming from a broad range of sectors, including artificial intelligence, data centers, industrial electrification, including the oil and gas sector, a burgeoning hydrogen economy and electric vehicles, Vegas said. In total, ERCOT anticipates about 152 GW of new load by 2030.
“We are the best market in the country to react to that kind of growth potential,” Vegas said, touting ERCOT’s status as an “energy island” and resulting lack of federal oversight. “We have the ability in our economy to connect dispatchable resources faster than anyplace else in the country.”
· Reevaluation net metering – The IMM has specifically urged reconsideration of net metering for any loads behind the meter of unaffiliated entities, as net metering for these loads may disincentivize flexible loads from instead registering as Controllable Load Resources (CLRs)."Loads that can be turned on and off quickly, such as data centers and crypto-currency mines, should be incented to be dispatchable in real time through CLR participation rather than reducing their consumption to avoid transmission cost allocation and other load charges. This would help support price formation and provide better congestion management," the IMM has said. Like 4CP, Staff noted that the net metering question is controversial and described the matter as a policy question for the PUC. Staff recommended discussing the net metering issue in tandem with the 4CP issue in the fall of 2025. Staff's recommendations described above were made as Staff offered its opinion on all of the IMM's recommendations in the state of the market report, reflecting a new approach by Staff to formally offer Staff's views on the IMM recommendations.
· Modify transmission cost of setrivce away from 4CP method – The IMM has said that 4CP allocation no longer reflects the drivers of new transmission needs. Additionally, the IMM has said that demand response from entities seeking to avoid 4CP charges is "likely" inconsistent with real-time market signals and can "significantly" distort market outcomes. Staff supports moving away from 4CP for transmission cost allocation. Staff suggested that an alternative to 4CP could be developed which still complies with PURA's requirement for a postage-stamp transmission rate and that such rate be based on total demand."Changes in ERCOT grid topology and upcoming initiatives which will result in significant transmission build out warrant that it may be time to re-examine the TCOS [transmission cost of service] allocation," Staff said. “Staff understands that this topic is controversial and may benefit from the Commission determining what, if any, next steps should be taken on these issues," Staff said. Staff recommended discussing the 4CP issue in the fall of 2025.Staff said that the 4CP issue is closely linked to an IMM recommendation to re-evaluate the eligibility for certain sites, including certain data centers and crypto-currency mines, for net metering.
Texas Energy Fund Loan Program
The Public Utility Commission of Texas on tapped 17 gas-fired generation projects totaling almost 10 GW to potentially receive 3% state-backed loans supporting their development. The portfolio represents a total of $5.4 billion in loans.
The funds are available through the Texas Energy Fund loan program, which voters approved last year to incentivize new power plants. The PUCT received 72 loan applications representing more than 38 GW in the Electric Reliability Council of Texas system.
Update Load Forecast
ERCOT has sharply increased its prediction for how much power demand will increase in coming years. If it’s accurate, the state would need to be able to provide nearly double the amount of power within six years.
Two factors led to the higher forecast: A new law allows officials to count companies’ requests for grid connections before they are finalized. And there has been a significant rise in requests from large users such as data centers, hydrogen production facilities and oil and gas companies that are electrifying their operations.
Demand on the power grid hit a record of 85 gigawatts last year, which was the hottest ever recorded in the state. ERCOT experts now say demand could reach around 150 gigawatts by 2030.
More than a third of the forecast growth comes from the Permian Basin, where oil and gas operators are converting operations to run on electricity instead of gas or diesel. Much is also coming from large users such as data centers that are powering artificial intelligence and crypto currency mining. Some are requesting several times more power than what the city of Lubbock now uses, according to ERCOT.
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