LP&L Set to Join ERCOT
On March 19, 2018, the Public Utility Commission officially approved Lubbock Power & Light’s application to join the Electric Reliability Council of Texas (ERCOT). The solution continues to supply affordable power to LP&L customers and provides a diversified energy portfolio. Watch the video to learn more about what to expect and why this is an important step for the City of Lubbock.
Brandy Marquez: I make a motion that we adopt this order consistent with the conversation here.
Andy Burcham: This has been a very long process. We started in 2014 looking for a resolution to the ending of a contract that would end in 2019. So we've spent a lot of time looking for the best alternative for our customers.
David McCalla: And that's the only reason we're doing it. It's required a significant effort to get us to this point. It's going to require significant effort over the next three years to get us integrated with ERCOT, but it's for the good of the consumers. Whether we benefit from the wholesale market in ERCOT, or whether they benefit from the retail market if we opt in.
Greg Taylor: This is good for the citizens, the rate payers, and Lubbock, because we'll be able to take advantage of the most efficient market for electricity in the country.
Andy Burcham: The decision to go into ERCOT rather than build a power plant was I think a good one, because we have a diversified portfolio of energy in ERCOT as opposed to a single source of power if we had built a plant which had been dedicated basically to a natural gas. But in ERCOT, there's about 570 different generating units being either wind, solar, coal, natural gas, nuclear. There's a whole diversified portfolio of energy sources, and so that gives us an opportunity to get the best pricing on energy.
Greg Taylor: West Texas is a center for wind energy production. Right now we have a very large amount of wind that goes into the ERCOT grid and goes right past Lubbock in the CREZ lines or transmission lines that go into the ERCOT grid. But joining ERCOT, we will be able to take advantage of some of that power that is already being generated in West Texas, and we will also bring more stability to the wind energy generation part of the system, and make that more reliable and stable for the whole state.
David McCalla: What will have to happen for us to interconnect with ERCOT is they'll have to be transmission facilities built to tie Lubbock in with ERCOT. So there's transmission lines that will have to be built to the north of Lubbock, to the south of Lubbock, and then on the east side of Lubbock. So we'll have three main facilities, three 45 KB to 115 KB substations, transformers, and then interconnection transmission lines coming out of those facilities that will tie in to the Lubbock power line transmission system. And that will give us a very strong connection to ERCOT.
Andy Burcham: When we build the new transmission lines, we also will receive a revenue on that. It's a revenue stream that we don't receive today.
Greg Taylor: One of the things I'm most excited about is in the area of economic development. Our large power users, if we're able to enter the competitive marketplace, will be able to satisfy their energy needs in a very open and competitive way. That should lead them to be able to fund more efficient effective power solutions at a very efficient price. So, we are very hopeful that that will also not only benefit our existing industry customers, but will also help in economic development for the city as a whole.
Andy Burcham: This isn't just for the next five years or the next 10 years. It's a decision that we've made for the very long term, and we believe that the benefits will extend into multiple generations.