An energy market consultant testified at a Texas Public Utility Commission that a tweak to the state’s electric grid software could help system stability. The change would invoke so called scarcity pricing sooner in the day as the available supply in the grid starts to shrink relative to the demand. This change would allow producers to demand higher prices for the electricity they sell in the open market.
Not surprisingly, the retail electric providers (who would be paying the higher rates) were not crazy about the idea.
According to the Dallas Morning News:
“But there was opposition from the electrical retailers, the public face of the industry.
Raising rates earlier in the day could be disastrous for retailers, testified Sandy Morris, senior manager of government affairs for Direct Energy. Some of that cost would be passed on to consumers, but Morris said that on hot days retailers could face large losses.”