HOUSTON – Texas energy leaders say the state’s electric market is in a strong position, but major decisions ahead could affect both reliability and what people pay each month.
At a recent panel during CERAWeek in Houston titled “Powering Texas,” Thomas Gleeson, chairman of the Public Utility Commission of Texas, spoke about the state of the grid.
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“I think the state of the energy industry of electricity in Texas is really healthy,” Gleeson said. “We have a lot of really important policy debates going on right now.”
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Rapid growth in data centers, population increases, and industrial expansion are driving the state’s rising energy demand.
Cully Cavness, president and COO of Crusoe Energy, said Texas has become a key destination for large-scale energy projects.
“Texas has quickly become the number one state in which we do business, in large part because of the dynamics about [the] ERCOT market system that is flexible,” Cavness adds. “It is relatively smoother here than many other states.”
That’s why Gleeson says Texas must lead as demand grows.
“I think Texas will, and Texas has led on it,” Gleeson said.
How much growth is coming
There is no clear agreement on how large the grid will need to be in the coming years.
Gleeson said regulators are still trying to sort through competing projections.
“We’re endeavoring right now at the commission to pass rules to get a better sense of what is real,” he explained.
This growth does bring uncertainty.
“When you don’t know what is real, you really don’t know how to build the infrastructure for it,” Gleeson said.
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What it could mean for your bill
Margo Weisz with the Texas Energy Policy Research Institute said Texans have already seen rising costs.
“Over the last five years we saw a 30 percent increase in energy pricing in the residential sector,” Weisz said.
Looking ahead, she said the trend is expected to continue.
“We projected another 30 percent increase in bill prices, and that is largely driven by investments in transmission and distribution.” she added. “So yeah, we see some reason for concern to make sure that we are not over-investing and that those prices are allocated in a way that doesn’t overly burden those who are already struggling.”
Affordability is already a major concern for many households.
“In the State of Texas, we have over 40 percent of the households struggle with low and moderate income,” Weisz said.
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She added, “Our concern is for households that already cannot afford their bills and are trying to pay for housing, food, and medicine. Energy is just another cost they can’t afford.”
At the same time, regulators say they are trying to avoid shifting costs onto residential customers.
“We can’t have a system that ends up putting the cost of that on the backs of small commercial and residential ratepayers,” Gleeson said.
Weisz pointed to the real-world impact when the system fails.
“When there’s an emergency and an outage, it is people with low incomes that are suffering the most,” she added. “They don’t have options. When you look at the emergency rooms and you look in the hospitals, people actually are dying from heat-related deaths.”
The discussion repeatedly returned to a central tension: keeping the grid reliable while controlling costs.
Gleeson said both priorities must be balanced as Texas moves into the future.
Companies that will use the energy say they want clearer rules.
“The longer that there is not a set of clear and stable rules, the harder it is to make investments,” Cavness said.
Gleeson encouraged continued public engagement as those rules are developed.
“We have a very robust and open process,” the chairman said. “Engage in the process.”
He added that the outcome could extend beyond Texas: “If we get this right, we can help lead the country to get this right.”