March 12, 2015
Kirsten Voinis (512) 922-7141 or kvoinis@kvoinis.com
AEMA SUPPORTS DEMAND RESPONSE LEGISLATION FILED IN TEXAS LEGISLATURE
Statement on filing of SB 1284 by Sen. Kirk Watson and HB 3343 by Rep. Sylvester Turner
(AUSTIN, TX) The Advanced Energy Management Alliance (AEMA) applauds the filing of legislation that would help give Texans more opportunity to control their own electricity usage at times when the state’s electric grid is under stress and prices are high.
Senate Bill 1284 by Sen. Kirk Watson (D-Austin) and HB 3343 by Rep. Sylvester Turner (D-Houston) will increase competition in the Texas electric market and increase reliability for all Texans.
“Demand response is a valuable energy management tool that needs to be part of a comprehensive market to fulfill Texas’ future power needs while empowering consumers to have more choices and control over their electricity use,” said AEMA Chairman Frank Lacey, senior vice president, regulatory and market strategy, for CPower.
Demand response empowers individual and business customers to manage their electric usage when the grid is most strained – usually during heat waves or cold spells – improving grid reliability, saving money and reducing environmental impact from further electricity production.
“We’re giving customers more control over their electricity bill and offering a free-market solution to a critical problem by reducing the demand for electricity when the supply is tight,” Watson said. “Texas has a lot of untapped potential in this area, and I’m hopeful SB 1284 will help draw attention to the benefits of demand response.”
“Demand response is a low cost means to address the need for resource adequacy,” Turner said. “Encouraging the growth of voluntary demand response could potentially provide cost savings and avoid the prospect of involuntary rolling outages.”
Demand response is underutilized in Texas, however. While demand response now shaves about 4 percent of energy use during peak demand periods in Texas, that number could reach as high as 15 percent if barriers to expanding demand response were removed, according to a 2012 report by the Brattle Group, a consulting firm retained by ERCOT.
“Demand response is not fulfilling its potential in Texas because state market rules and energy regulations fail to fully recognize its value,” Lacey said. “SB 1284 and HB 3343 will help promote the widespread deployment of demand response in Texas and eliminate constraints that impede its growth.”
Greater use of demand response in Texas will result in a more economically efficient, reliable and competitive electricity market while promoting a strong state economy and lower power costs for individuals and businesses.
Among the provisions of SB 1284 and HB 3343 that AEMA supports include requiring the Public Utility Commission of Texas to adopt rules to:
- Require the Electric Reliability Council of Texas (ERCOT) to periodically study and report on the demand response opportunity and the amount of demand response participating in the market.
- Promote the development of demand response participation in electricity markets for all customers and remove regulatory barriers to provide reliability and economic benefits to the grid.
- Ensure that all electricity customers – whether residential, commercial, or industrial – have choices among demand response providers and demand response programs.
SB 1284 and HB 3343 can be found and tracked here: http://www.capitol.state.tx.us