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Texas Blackouts Grab Legislative, Regulatory Attention

Rolling blackouts last Monday in Texas raised the hackles of state and U.S. congress members and garnered the attention of FERC Chairman Joseph Kelliher, meaning the Electric Reliability Council of Texas (ERCOT) will be coming in for scrutiny.

The blackout that hit Texas on Monday was a "serious incident," and the Federal Energy Regulatory Commission will be working closely with ERCOT and the North American Electric Reliability Council (NERC) "to understand this event," Kelliher said Thursday, noting blackouts in the Lone Star state affected about 200,000.

"At the time of the event, there was a significant amount of generation that was not available due to planned maintenance," Kelliher said at FERC's open meeting. "Roughly 20% of the generation in ERCOT was unavailable due to planned maintenance -- something like 14,000 MW." Kelliher also noted that "the weather was hotter than expected, about five degrees hotter than projected." The "decisive factor seemed to be" unplanned outages. "Four units tripped, constituting about 1,200 MW."

Kelliher said that "all available generation resources were committed, but no additional resources were available once those four units were lost." He noted that "many blackouts are caused by the violation of voluntary reliability standards. That's been the case in major incidents in the past. At this point, we have no assessment at this time whether or not there was a violation of reliability standards that occurred in ERCOT on Monday."

ERCOT "is conducting an investigation and the Commission staff are conducting their own analysis and we will be working closely with ERCOT and NERC to understand this event."

Last Monday ERCOT was forced to implement rolling blackouts due to high temperatures that gripped the state at a time of year when generation often is out of service for maintenance. ERCOT said its grid broke the all-time April peak demand record Monday with a preliminary estimate of 51,714 MW. The all-time system peak is 60,290 MW, set Aug. 23, 2005, during the traditional summer peak season.

U.S. Rep. Sheila Jackson Lee, D-Houston, wrote to Kelliher to complain about the blackouts, and Texas Sen. Troy Fraser, R-Horseshoe Bay, slammed the ERCOT in a letter to Paul Hudson, chairman of the Public Utility Commission of Texas (PUC).

"It is evident to me that the organization [ERCOT] continues to operate with a misunderstanding of its relationship and commitment to the legislature that created it, the PUC that oversees it, and the rights of the general public in Texas. I would like for you to be prepared to discuss with us ways to finally remedy these continued challenges at ERCOT," Fraser wrote. "In light of the events of yesterday [Monday] and my ongoing concerns, I would like assurances that the state can continue to demonstrate its confidence in the market. I would like for you to present the results of your investigation to the Senate Committee on Business and Commerce on April 25, 2006."

Fraser complained that ERCOT "made no attempt to contact appropriate members of the legislature and the executive branch when yesterday's events became imminent. It also appears that local law enforcement and emergency services were not notified by the proper authorities. Having said that, I believe that ERCOT must establish appropriate notice procedures to maintain the public trust and keep all channels of communication open with the PUC and the legislature."

Lee also was perturbed by an apparent lack of communication on ERCOT's part. "I am particularly concerned that the rolling blackouts were instituted without notice even though there appeared to be sufficient time to notify local officials, emergency first responders and the broadcast media before taking such serious actions," she wrote.

ERCOT implemented its emergency plan at 3 p.m. central time Monday. Step 1 of the plan calls for all available generating capacity to go online. Step 2 was enacted at about 4 p.m. when ERCOT shed 1,150 MW of interruptible industrial load. At about 4:05 p.m. ERCOT unexpectedly lost four generation units and at 4:13 p.m. instituted step 4 of its plan by instructing transmission owners to shed 1,000 MW of firm load. At 4:25 ERCOT issued an appeal for voluntary curtailment. This measure is actually step 3, but it came after step 4 due to time constraints, ERCOT said. At 6 p.m. ERCOT withdrew its firm load shed instructions, and at 6:15 the voluntary load curtailment request was lifted.

The last time ERCOT had to use its emergency curtailment plan was during an ice storm in February 2003. The last time interruptible loads were curtailed was August 1999. And the last time involuntary firm load shedding occurred in ERCOT was Dec. 22, 1989.

CenterPoint Energy of Houston Monday cut power at 15-minute intervals to as many as 78,000 customers, and similar cuts by TXU Electric Delivery in Dallas affected 80,000 customers, the Houston Chronicle reported.

"We were caught in a generation shortfall due to the fact that this heat wave occurred during a time of year when temperatures are generally mild and demand for electricity is normally low," said Sam Jones, ERCOT chief operations officer. "Consequently, many generation plants were down for maintenance, which is typical during April, a traditional 'shoulder' month when temperatures are typically mild."

As unseasonably warm temperatures continued into Tuesday ERCOT feared a repeat of of Monday's rolling blackouts. The council advised conservation measures during peak afternoon hours, but rolling blackouts were avoided. ERCOT forecasted a peak load of about 53,000 MW and predicted there would be 58,000 MW of generation available. Additional generation was brought online Tuesday through the delay of some scheduled maintenance outages. Additionally, some units that were out for maintenance came back online. For instance, TXU Corp.'s 750 MW Martin Lake 1 coal-fired plant returned to service after a 40-day outage. Also, TXU delayed maintenance at its 750 MW Monticello 3 coal-fired unit and its 570 MW Big Brown 1 unit. "Everything we are doing is to help ERCOT meet this demand," TXU spokesman Tom Kleckner told Reuters.

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