> Yes. Fundamentally, the difference between the Texas market and other energy markets across the U.S. is that it’s an electricity-only market. There is no capacity market paying generators to ensure there will be enough power to meet peak demand. The generators only make money when they’re delivering electrons into the grid.
> He said he had nearly emptied his savings account so that he would be able to pay the $16,752 electric bill charged to his credit card — 70 times what he usually pays for all of his utilities combined. “There’s nothing I can do about it, but it’s broken me.”
An electricity-only market isn’t unusual. France, Spain, Italy, and the UK created capacity markets only recently (in 2017, 2021, 2018, and 2014, respectively). Germany specifically decided against creating one: https://www.sciencedirect.com/science/article/abs/pii/S22146....
OP is imputing some ideological aspect to ERCOT’s design, but electricity-only markets versus an electricity-plus-capacity markets is a technical detail of how the market is structured. Both are “deregulated electrical market structures” that separate electric utilities from generators—which is the specific feature OP was complaining about.
In fact, capacity markets are typically seen as subsidies for fossil fuels. The whole point is to take money from ratepayers and give it to generators who can commit to producing a definite capacity. That process favors gas plants; renewables capacity is heavily discounted in capacity auctions.
I’m mostly imputing ideological motives to what ERCOT’s become and how that’s led them to fail at operating a robust, reliable grid, and highlighting some of the perverse incentives specific to Texas’s electrical market. I’m also complaining about our legislature’s resistance to, and efforts to actively stymie, the incredible bounty of renewable energy resources this state possesses. Fortunately the profit potential is strong enough that the invisible hand is continuing to do its job, but my god, this state is the Saudi Arabia of wind and to a lesser degree solar. As well as being a Saudi Arabia of, well, oil and gas! Why not embrace all of the above??
I personally enjoy the Western standard of living, and that, today and for the foreseeable future, is absolutely predicated on fossil fuels being a substantial part of the energy mix. I also try not to be a hypocrite so I actually consider myself pro-fossil fuel when used efficiently and appropriately. As such, I favor just about all types of electrical generation, except for coal and oil fired plants (and possibly biomass - I don’t know the technical details well enough, but my vague understanding is that’s basically regulatory arbitrage that does more harm than good). At least fortunately oil-fired plants are vanishingly rare these days.
Natural gas generators absolutely should get capacity payments as firm generation that can be called on rapidly (newest combined cycle turbines can ramp within 15-30 minutes), but so should batteries and battery firmed renewables.
If you can generate when called upon, you should get paid to be there when sufficient capacity is questionable. If you cannot, your generation should trade at a discount to reflect its intermittent nature.
https://insights.som.yale.edu/insights/why-the-texas-power-m...
> Yes. Fundamentally, the difference between the Texas market and other energy markets across the U.S. is that it’s an electricity-only market. There is no capacity market paying generators to ensure there will be enough power to meet peak demand. The generators only make money when they’re delivering electrons into the grid.
https://www.npr.org/2021/02/27/970877890/the-power-is-back-o...
> Take DeAndrew Upshaw of Dallas. His electricity bill is normally $80. A bad month is $300. His electricity bill over seven days in February? $6,700.
https://www.nytimes.com/2021/02/20/us/texas-storm-electric-b...
> He said he had nearly emptied his savings account so that he would be able to pay the $16,752 electric bill charged to his credit card — 70 times what he usually pays for all of his utilities combined. “There’s nothing I can do about it, but it’s broken me.”
That's not very standard.