Eight Texas Power Companies Face $7.5 Million in Penalties for Failure to Submit Winter Readiness Reports

The Texas Public Utility Commission staff on Dec. 8 filed reports of violation against eight generation companies for failing to timely submit winter weather readiness plans. Thirteen of the state’s 850 generation resources owned by these companies missed the Dec. 1, 2021 deadline. In October, the commission adopted a rule addressing weather emergency preparedness of power generators and utilities following legislation enacted to address the issues faced during and after the mid-February winter storm event that caused widespread outages across the state. The rule directed affected companies to implement recommendations identified in a 2012 report and attest to the repair of any known acute issues caused by the February event, by the end of the year.

The 13 resources that received violation reports have the ability to generate 801 megawatts of electricity out of the state’s total installed capacity of 120,000 megawatts. The commission said that subsequent inspections by the Electric Reliability Council of Texas will verify whether these companies have taken measures to weatherize their facilities. The affected entities have 20 days to respond to the notice of violation and may request a hearing.

The weatherization rule turns known industry best practices into specific actions with inspections and financial penalties based on the requirements outlined in Texas Senate Bill 3 enacted in June. The rule focuses on ways to mitigate the effects of extreme weather events on cold weather critical components through methods like windbreaks and insulation.

In a related measure, on Dec. 1, the commission announced a rule that creates a new designation for critical natural gas facilities that supply fuel to electricity generators. The rule, adopted in coordination with the Texas Railroad Commission, aims to enhance the coordination between the electric and gas industries. Under the new rule, a critical natural gas facility is required to provide information to the utility from which it receives electric delivery service, and the electric utility must use this information to prioritize gas during an energy emergency. The rule complements ongoing efforts to map the supply chain between the two industries.

The commission noted that a relatively larger number of natural gas facilities have registered critical status with their electric delivery utility compared to last winter. The move enables utilities to plan and respond more accurately to keep gas facilities energized during an emergency.