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LCG Publishes 2025 Annual Outlook for Texas Electricity Market (ERCOT)

LCG, August 14, 2024 – LCG Consulting (LCG) has released its annual outlook of the ERCOT wholesale electricity market for 2025, highlighting the region's rapid transition toward increased reliance on renewable energy resources and battery storage.

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LCG Publishes 2025 Annual Outlook for Texas Electricity Market (ERCOT)

LCG, August 14, 2024 – LCG Consulting (LCG) has released its annual outlook of the ERCOT wholesale electricity market for 2025, highlighting the region's rapid transition toward increased reliance on renewable energy resources and battery storage.

Read more

Industry News

Wise Words from One of California's Out-of-State Power Pirates

LCG, Jan. 11, 2001Reliant Energy Inc. said yesterday that the talks in Washington involving officials of the Clinton administration, the state of California, California's public utilities and independent power producers active in California was only "a first step" toward reaching long-term solutions.

Houston-based Reliant, one of the out-of-state generators vilified by California Gov. Gray Davis for piracy and price-gouging, has no shortage of ideas about how to solve the state's electricity crisis.

Reliant said it agreed with the governor and other participants in the Washington meeting that the basic problem was one of supply, and most rational observers would also agree. During the past 10 years, no new power plants have been built in the state while power reserves have shrunk from 15 percent in the early 1990s to less than zero today.

In the short term, Reliant says, "California needs to work at conserving as much electricity as possible so the lights don't go out (because) there simply is not enough supply." The company also believes there needs to be a major load management effort with aggressive leadership to reduce power use dramatically as the summer approaches, not just in California but throughout the entire (Western Systems Coordinating Council) power region. If this does not occur, Reliant says, there likely will be power outages later this year.

In the long-term, according to Reliant, California needs to create a process for siting and building "environmentally friendly" power plants that is better suited to meet the rapidly increasing demands for power. "In particular, the state government must work with local government bodies to make new Power plant construction possible in California," Reliant said.

Reliant says more needs to be done, such as overhauling the electricity buying process. The company supports efforts to facilitate forward contracting at reasonable prices for existing capacity under terms that assure payment and recovery of the costs associated with that generation and agrees that the buying process must be streamlined to allow utilities to enter into reasonably priced, long-term contracts with generators.

But that isn't enough, Reliant says, noting that much of the generation capacity in California has already been sold prospectively to other users and marketers when the California utilities did not enter into their own long-term contracts. As a result, Reliant believes that contracting for supplies outside of California needs to be pursued aggressively to deal with the supply deficiency.

As to views expressed by some politicians and consumer groups that California can set up some sort of isolationist power system in which power generated in the state never leaves California, Reliant warns that the power shortage is really a problem for the entire Western United States and by attempting to go it alone California could alienate itself from its neighbors. "This is especially true considering California is the single largest energy importer in the West and must build constructive partnerships with its neighbors, not divisive mandates," Reliant said.

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