Exec Calls for Action on New Texas Gas-Fired Plants

The post Exec Calls for Action on New Texas Gas-Fired Plants appeared first on POWER Magazine.

The chief executive of a Connecticut-based energy investment firm has called for action on his group's proposal to build as many as 11 new natural gas-fired power plants in Texas.

Himanshu Saxena, CEO of Starwood Energy Group, in a June 14 interview said, We would like to see significant steps in countering, negotiating and material tangible actions on our proposal."

Saxena's comments, published by Reuters, came the same day the state's grid operator, the Electric Reliability Council of Texas (ERCOT), asked Texans to reduce their electricity use as much as possible" this week. ERCOT said that power plants accounting for as much as 11 GW of generation capacity were offline due to what it called forced outages," at a time when temperatures have soared into the upper 90s in the state. ERCOT in an email to POWER wrote that forced outages are unscheduled and result from the failure of a power plant to function as designed."

Himanshu Saxena

A significant number of forced generation outages combined with potential record electric use for the month of June has resulted in tight grid conditions," ERCOT said in a statement.

Starwood's proposal, in an April 23 letter from Saxena to ERCOT's board and the state's Public Utility Commission (PUCT), came in the wake of a February weather emergency, when extreme cold caused blackouts in Texas and left more than 4 million electricity customers without power for days. The situation resulted in more than 150 deaths, sent power prices soaring, and drove some power suppliers in Texas' deregulated market into bankruptcy.

The February event also led to firings and resignations of several officers, including the dismissal of then-ERCOT CEO Bill Magness, and the resignation of then-PUCT head DeAnn Walker.

Starwood Plan-11 New Plants

Saxena in his April letter wrote that, Starwood Energy is interested in developing, building and owning 11 new natural gas-fired power plants totaling 11 GW of new generating capacity, with ample natural gas storage at each site, located across ERCOT and subject to ERCOT's control. These power plants will be highly efficient, state of the art and will have dual-fuel and black start capabilities."

Saxena on Monday said, We would love to see more urgency from the system. I think there is interest, in the sense that folks are curious about what we're offering to do."

The Starwood proposal came after billionaire Warren Buffett's Berkshire Hathaway Energy in March unveiled a similar plan, in which it said it could spend about $8.3 billion to build 10 gas-fired plants across the state. In both cases, the groups said the new plants would primarily function as peaker" facilities, able to ramp up quickly to provide electricity during periods of high demand for power.

Saxena has said the Starwood plan requires action by state lawmakers, who reportedly have been lukewarm to the ideas. The state's competitive power companies also have expressed opposition to the proposals.

The PUCT has acknowledged that both the Starwood and Berkshire Hathaway initiatives were presented to the legislature during its recent session that ended on Memorial Day. Lawmakers during that session did approve measures to restructure the state's power grid, including requirements for weatherizing power systems.

Starwood has said the company already has developed, built, and operated more than 1 GW of wind generation across ERCOT's system, and has owned and operated another 550 MW of gas-fired power generation capacity.

Berkshire Hathaway Plan-10 New Plants

Chris Brown, CEO of Berkshire Hathaway Energy, earlier said his group does not want to supplant Texas' deregulated power market, a competitive situation in which all power generators in the state are paid for the energy they produce and sell, as opposed to the power they could potentially generate. The group's executives said their plan would not create a capacity market, but would instead be a way to provide highly regulated backup electricity generation, operated by a new company-the Texas Emergency Power Reserve.

Brown in March told The Texas Tribune that his company is uniquely suited" to provide 10 new plants that would bring 10 GW of generation capacity to the Texas grid by November 2023. Brown told the Tribune that Berkshire Hathaway Energy would owe the state $4 billion if it did not have the plants operating by that deadline.

Brown said his group wanted to operate in partnership with Texas energy officials, and the plan is simply to provide a reliable source of backup power."

-Darrell Proctor is a senior associate editor for POWER (@POWERmagazine).

The post Exec Calls for Action on New Texas Gas-Fired Plants appeared first on POWER Magazine.