Opposing Forces Up The Ante On Climate Change / Electric Utility Dilemma

By Bill Oakey, August 3, 2022

I have written about the big conundrum facing Austin Energy and other utilities. As their own employees help homeowners and businesses become more energy efficient, the utilities find themselves wanting to raise rates, because they’re not selling enough electricity. Austin Energy has forecast the potential need for more than one rate increase. And as I’m writing this, a dear friend is preparing for contractors to install solar panels on her roof. A 10 kilowatt battery to store excess energy comes with her package.

It’s easy to see how rate increases to shore up lost utility revenues will backfire. The contractor that is helping my friend will boost their advertising, as will the others in that business. Utilities will find that chasing revenue deficits with successive rate increases could send them into a death spiral. Climate change is the trigger here. It drives summer electric bills to historic high levels. That pushes businesses and residents to go solar, and employ every other efficiency measure they can find.

This daunting dilemma looks to get worse, because of a series of circumstances that have yet to be widely recognized. That’s why I’m making a push to alert the news media and the Austin City Council, as well as Congressman Lloyd Doggett.

Big Changes May Come to the Texas Power Grid

I was jolted awake this morning by a shocking article in the Texas Tribune. Come to find out, there is plenty of West Texas wind energy available. But ERCOT, the Texas grid management agency, has ordered a lot of the wind turbines to be shut down this summer. Why? Because there aren’t enough transmission lines to deliver the cheap wind power to big cities like Dallas, Houston and Austin. The Texas Public Utility Commission is working on a solution (we hope)! Two recent grid assessment reports cited in the Tribune article highlight the many shortcomings in the grid system. Three entities will collide over what response follows those reports – public interest groups, special interest groups and politicians. The problems can be fixed, if the solutions aren’t nixed. The future of your bill rests on political will.

There is reason for hope. From the Tribune article comes two profound statements. “This month, the PUblic Utility Commission formed a task force to develop a pilot program next year that would create a pathway for solar panels and batteries on small-scale systems, like homes and businesses, to add that energy to the grid. The program would make solar and batteries more accessible and affordable for customers, and it would pay customers to share their stored energy to the grid as well.”

And this comment from John Hensley, with the American Clean Power Association. “Storage is the real game-changer because it can really help to mediate and control a lot of the intermittency issues that a lot of folks worry about when they think about wind and solar technology. So being able to capture a lot of that solar that comes right around noon to [1 p.m.] and move it to those evening periods when demand is at its highest, or even move strong wind resources from overnight to the early morning or afternoon hours.”

How Can the Utilities Stay In Business, As Efficiency Drains Revenues?

That’s the big challenge that demands to be addressed. I submit that, above all, it should be discussed and resolved out in the open. Our local leaders, our Congressmen and women, and the public should all be granted a seat at the table. If we stay in the background and hope for the best, nothing good may come of it. With or without Congressional passage of the current climate bill, future legislation will probably happen. Utilities may need to completely rethink their business models. Austin would be an ideal place to host a major conference on resolving the dilemma.

One thing is certain. All utilities will be generating and selling a lot less energy in the years to come. That’s a good thing for progress on climate change. But utilities must not be allowed to charge unreasonable rates, and cut back credits for end users who generate and store their own energy. For now, Austinites are staring down a terribly flawed rate increase proposal. That calls for a poem:

The folks at Austin Energy are way out of touch
They simply don’t care about us very much
In a fancy new building that cost $150 million
They wrestle with a budget of a couple gazillion

Amongst them is a band of renegade abusers
Who want to raise rates for the smallest users
While the Austin economy sees poverty expansion
They would lower the rates for a big, sprawling mansion

Pardon me if I be so bold
But their rate increase should be put on hold
From the month of May to the end of September
They’ll make more money than anyone can remember

The City needs time to assess the situation
And we’re in a recession with high inflation
My idea might be met with a blanket rejection
But there’s an upcoming City Council election

We need transparency, reason and fairness
And a whole lot more public awareness
This is a time for all hands on deck
We and our neighbors should protest like heck!

Musical Accompaniment for This Blog Piece:

  1. “Blowing in the Wind” – Peter, Paul & Mary
  2. “Wind Beneath My Wings” – Bette Midler
  3. “Candle in the Wind” – Elton John
  4. “Catch the Wind” – Donovan
  5. “Summer Wind” – Frank Sinatra

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