LUBBOCK, Texas – Lubbock Power and Light (LP&L) has initiated the process to join the Texas state electric grid. The LP&L Electric Utility Board joined with the Lubbock City Council today to make the historic announcement that the electric utility will seek entry to the Electric Reliability Council of Texas (ERCOT). The announcement comes after a year of comprehensive study by LP&L regarding the path forward beyond the June 2019 expiration of the utility’s current power contract.
“Today’s announcement, led by the Electric Utility Board and the Lubbock City Council, marks an important milestone that will greatly benefit the citizens of Lubbock,” said David McCalla, Director of Electric Utilities. “Moving to ERCOT accomplishes all of the goals we set forth at the beginning of the 2019 process. It provides our customers a diversified portfolio of reliable and affordable Texas power for generations to come.”
Joining ERCOT brings a number of advantages to LP&L:
Delivers affordable power:
Assures a diversified energy portfolio from Texas-based power plants:
Simplifies the regulatory environment.
The LP&L Electric Utility Board and management team utilized a set of key goals to guide the 2019 decision-making process:
With the goals providing a framework for decision-making, LP&L staff and expert consultants performed 19 different in-depth studies over the past year involving every aspect of power generation in order to arrive at the direction announced by the Electric Utility Board.
- Eliminates the need to build an expensive power plant with estimated costs ranging from $350 to $700 million
- Provides access to 550 generation units and more than 1,100 active market participants that generate, move, buy, sell or use wholesale electricity
- Allows LP&L to buy the most cost-effective power from the grid
- Cuts the utility’s wholesale power costs by eliminating expensive fixed-capacity charges
- Provides full access to West Texas wind and a mix of conventional and renewable electric generation such as natural gas, solar and coal
- Provides stability through access to 550 generation units across Texas, avoiding dependence on a single generation source
- Removes regulation by the Federal Energy Regulatory Commission (FERC)
- Involves regulation by the Public Utility Commission of Texas and the Texas Legislature
- Unites Lubbock with the State of Texas through our connection to the statewide transmission system
- Provide predictable and stable pricing for LP&L’s customers
- Enhance flexibility and diversification of LP&L’s energy supply while conserving local water resources
- Limit the issuance of additional debt
- Maximize LP&L’s existing generation assets
- Achieve a simplified regulatory environment
An important aspect of this plan is that it allows LP&L to tap into a diverse energy portfolio from Texas-based power plants while giving full access to West Texas wind generation. “Look out on the horizon today in all directions from Lubbock and you will see wind energy,” said Greg Taylor, Chairman of the Electric Utility Board. “Every day the wind turbines are turning, producing electricity that flows right past us, yet we cannot access it. By joining ERCOT, LP&L customers can, for the first time, benefit from our local wind resources.”
As a next step in the process, LP&L staff will bring a formal resolution outlining the decision to seek entry to ERCOT to the Electric Utility Board for their consideration of approval in October. LP&L then plans to apply for connection to the ERCOT grid through an approval and review process to be outlined by the Public Utility Commission of Texas (PUC). The process of initial approvals by the PUC is expected to take approximately a year which supports the stated timeframe of having necessary infrastructure in place to connect to the ERCOT grid in 2019.
The Lubbock City Council praised today’s announcement and supported the move to join ERCOT. “I sincerely appreciate the hard work and professionalism shown by the leadership at LP&L, the Electric Utility Board and City Council in identifying the best power solution for our citizens,” said Mayor Glen Robertson. “A move to ERCOT is a dynamic choice focused on the needs of West Texas. This a great day for the City of Lubbock.”
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Lubbock Power & Light is the third largest municipal electric utility in Texas and has been serving the citizens of Lubbock since 1917. LP&L serves more than 103,000 electric meters and owns and maintains 4,300 miles of power lines and three power plants in and around the City of Lubbock. For more information about Lubbock Power & Light, as well as updates on new customer initiatives implemented, go to www.lpandl.com and follow the utility on Facebook.