Governor Abbott signs ERCOT reforms, power grid “weatherization” legislation into law, with electric prices expected to rise

Governor Greg Abbott signed “weatherization” legislation for Texas’ electrical grid on Tuesday, June 8, 2021, which such legislation will surely increase electric bills for all Texas families, individuals, and businesses. Standing directly behind Abbott (dark hair, glasses) is State Representative Chris Paddie, claimed Republican of Marshall, who is one of the most unpopular legislators among conservatives for his destruction of legislation to ban taxpayer-funded lobbying during the 87th Legislative Session.

The Golden Hammer Staff Reports

Austin, June 10 – Texas Governor Greg Abbott signed Senate Bills 2 and 3 into law to reform the unpopular Electric Reliability Council of Texas (ERCOT) and weatherize and improve the reliability of the state’s power grid. The legislation will almost surely increase the cost of electricity across Texas, as power companies must “weatherize” the power grid and pass those costs through to customers.

One Texas power company, El Paso Electric, exercised the foresight to weatherize its power plants after the 2011 winter storms. The company spent $4.5 million on the upgrades and certainly did capitalize those costs and pass them on to customers.

The February, 2021, winter storm resulted in loss of power to more than 4 million Texas homes and the death of over 200 individuals.

Governor Abbott made ERCOT reform and weatherization of the power system emergency items this past session. The Governor was joined for the bill signing by Representative Chris Paddie, one of the most unpopular legislators among conservatives for his destruction of legislation to ban taxpayer-funded lobbying during the 87th Legislative Session, and Senators Kelly Hancock and Charles Schwertner.

Under Senate Bills 2 and 3, Texas will now require the weatherization of power generation facilities, natural gas facilities, and transmission facilities to handle extreme weather. The Texas Railroad Commission and ERCOT will be required to inspect these facilities, and failure to weatherize these facilities can result in a penalty of up to one million dollars.

Original proposals for this legislation, especially from the unpopular Representative Paddie, would have only resulted in penalties for failures to weatherize in the range of $1,000, which would have been an insignificant amount to create an incentive for power companies to complete weatherization.

This legislation also creates a “Power Outage Alert” where Texans will receive an emergency alert whenever the power supply in the state may be inadequate to meet demand. Of course, that raises the question what businesses, families, and individuals could possibly do when they receive such alerts. Additionally, this legislation establishes the Texas Energy Reliability Council to improve coordination between state agencies and industry during extreme weather emergencies and extended power outages. Finally, the legislation makes significant reforms to ERCOT, including having eight fully independent board members of the 11-member board, and requires board members to be residents of Texas.

“During the winter storm, too many Texans were left without heat or power for days on end, and I immediately made reforming ERCOT and weatherizing the power system emergency items,” said Governor Abbott. “We promised not to leave session until we fixed these problems, and I am proud to say that we kept that promise. These laws will improve the reliability of the electric grid and help ensure these problems never happen again.”

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