Two aging natural gas plants in San Antonio are scheduled to be retired later this year, prompting significant concerns about the region’s power reliability. Nathan Bigby, Chief Regulatory Counsel for the Electric Reliability Council of Texas (ERCOT), highlighted the risks posed by these closures during a board meeting on Tuesday.
“This is a significant reliability risk that we’re trying to address,” Bigby said, noting that ERCOT’s analysis revealed potential overloads on transmission lines that deliver power from South Texas into the San Antonio area. If these risks are not managed, Bigby warned, the situation could lead to “cascading outages” across the system.
To mitigate these concerns, ERCOT has decided to relocate fifteen large generators currently leased by CenterPoint Energy in Houston to San Antonio this summer. This plan, costing $54 million, will replace the power capacity lost from the retiring plants. While the cost is substantial, Bigby emphasized that it is more cost-effective than keeping the outdated facilities operational.
“By comparison, units one and two would collectively cost about $59 million under our projected dispatch scenario,” Bigby explained. This plan is expected to result in a modest increase of 0.4% on local electric bills. ERCOT officials argue that this is a small price to pay compared to the potential economic damage of a widespread power outage.
“$54 million is a substantial amount, but it’s just four-tenths of a percent on an average bill,” said Bill Flores, Chair of ERCOT’s Board of Directors. “And that cost is offset by avoiding the much higher cost of a load-shed event.”
This solution, however, is only temporary. CPS Energy, the utility serving San Antonio, is working to expand its transmission infrastructure to better support the growing demand, though that project is expected to take years to complete.
In the interim, Flores said, the generator move will “bridge that gap” and reduce the likelihood of power shortages.