News Release

December 21, 2009

ERCOT Report Outlines $8.2 Billion in Transmission Improvements

The Electric Reliability Council of Texas, grid operator and manager of the electric market for most of the state, is reviewing transmission projects proposed for the next five years totaling $8.2 billion and expected to improve or add 5,729 circuit miles of transmission and more than 19,000 megavolt ampere (MVA) of autotransformer capacity to the grid, according to the annual electric system constraints and needs report, filed today with the Public Utility Commission. 

Improvements to the grid completed since 2008 include 1,137 circuit miles of transmission and 8,511 MVA of autotransformer capacity with an estimated cost of $1.38 billion.

The planned improvements are significantly higher than the $3 billion reported in the 2008 transmission report because this year’s report includes the Competitive Renewable Energy Zone (CREZ) transmission additions that are planned to be in service by 2013.

Texas Senate Bill 20 directed the Public Utility Commission to designate zones with sufficient renewable resource potential and financial commitment by developers and then designate a plan for transmission to the areas.  The commission recommended a transmission scenario to support 18,456 MW of renewable generation at a cost of approximately $4.93 billion in transmission.  Earlier this year, the commissioners designated which entities will build the transmission in the CREZ areas.

Congestion Costs Return to 2007 Levels

The report also analyzes costs to resolve zonal congestion (between the four congestion zones) and intra-zonal congestion (local).  Zonal congestion costs returned to 2007 levels, recovering from a high of more than $375 million in 2008, due to a combination of events, including high fuel costs, revised market rules, and increased wind generation.

Intra-zonal congestion costs are also approximately the same as they were in 2007, after a slight rise in 2008.

RESOURCES ON LINE

ERCOT 2009 Electric System Constraints and Needs

ERCOT 2008 Long-Term System Assessment

ERCOT 2008 Electric System Constraints and Needs

 

TRANSMISSION PLANNING PROCESS    

The ERCOT transmission planning process integrates requests for transmission service to interconnect new power producers and consumers, as well as supports continued safe and reliable service while accommodating growth for existing customers. In collaboration with transmission service providers and other interested stakeholders, ERCOT staff assesses the electric needs of existing and potential transmission system users, on both an individual and collective basis, to determine whether transmission upgrades are required and to respond to the need. For this planning process, ERCOT seeks input from all market participants and stakeholders about options and possible solutions through the ERCOT-led Regional Planning Group.  Major projects must be also be endorsed by the ERCOT Board of Directors.

TRANSMISSION COSTS

Transmission and distribution providers are regulated by the Public Utility Commission.  The cost of transmission is rolled into costs that all ratepayers pay (also known as a “postage-stamp” transmission rate because – like stamps – it’s the same access fee no matter where the location is).  

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The Electric Reliability Council of Texas, Inc., (ERCOT) manages the flow of electric power to approximately 22 million Texas customers – representing 85 percent of the state''s electric load and 75 percent of the Texas land area.  As the Independent System Operator for the region, ERCOT schedules power on an electric grid that connects 40,000 miles of transmission lines and more than 550 generation units.  ERCOT also manages financial settlement for the competitive wholesale bulk-power market and administers customer switching for 6.5 million Texans in competitive choice areas.  ERCOT is a membership-based 501(c)(4) nonprofit corporation, governed by a board of directors and subject to oversight by the Public Utility Commission of Texas and the Texas Legislature. 

Media Contact: Theresa Gage, 512-225-7074; tgage@ercot.com

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The Electric Reliability Council of Texas (ERCOT) manages the flow of electric power to more than 26 million Texas customers -- representing about 90 percent of the state’s electric load. As the independent system operator for the region, ERCOT schedules power on an electric grid that connects more than 46,500 miles of transmission lines and 710+ generation units. It also performs financial settlement for the competitive wholesale bulk-power market and administers retail switching for nearly 8 million premises in competitive choice areas.

ERCOT is a membership-based 501(c)(4) nonprofit corporation, governed by a board of directors and subject to oversight by the Public Utility Commission of Texas and the Texas Legislature. Its members include consumers, cooperatives, generators, power marketers, retail electric providers, investor-owned electric utilities, transmission and distribution providers and municipally owned electric utilities.

Contact

media@ercot.com

512-275-7432