The Texas Public Utility Commission on June 28th voted to significantly increase a price offer cap in the state’s wholesale electricity market. The controversial decision is meant to increase wholesale energy prices in the hope that power generation companies will use the extra money to build more power plants. But Jay Doegey, president of the Texas Coalition for Affordable Power, notes that serious questions remain.
The following statement can be attributed to Mr. Doegey:
“While our coalition appreciates the difficulty of this issue, we share the concern of many that the Public Utility Commission first should have conducted a substantive analysis of consumer costs. By increasing the system wide offer cap, the PUC is promoting higher wholesale energy prices. No one knows how much this will cost Texas, or even whether it will result in more generation coming online. But one outcome seems likely: Texas consumers will end up paying more.
We applaud the PUC for its continuing efforts to encourage energy conservation and for its exploration of other potentially low-cost strategies to reduce electric demand, especially during peak hours. A well-functioning electric market requires both reliable service and affordable rates. Our coalition believes that the consideration of both must be part of any strategy to address the state’s long-term energy needs.”