The workshop centered on the Texas Backup Power Package (TBPP) program, which offers $1.8 billion in grants and loans for backup power at essential facilities.
The Public Utility Commission of Texas ensures compliance with legislation and regulations related to the Texas Energy Fund.
The workshop aimed to discuss industry perspectives and stakeholder feedback on the Texas Backup Power Package final report by Patrick Engineering, submitted on January 23, 2025.
Stakeholders were invited to provide input, both verbally and in writing, using project number 57236, with a deadline for submissions in April 2025. Legislative changes are not part of this workshop's agenda.
3.1.1 - How can the specifications be refined to prioritize cost savings, effectiveness, and affordability for TBPPs without compromising backup power and resilience goals?
Brian Kauffman from Mainspring Energy discussed the company's focus on linear generation technologies that are fuel flexible, efficient, low emission, and modular.
Emphasized the importance of allowing custom-designed projects that can operate flexibly, not just during grid failures.
Highlighted that grid parallel mode is permitted under statute and should not be restricted to island mode only.
Stressed that economic benefits are a key reason for customer investment in microgrids, with significant savings identified when operating at certain price levels.
Predicted load growth from 90 GW to 140 GW over the next four years, noting potential risks to customers, especially critical facilities.
Matt Boms with the Texas Advanced Energy Business Alliance, emphasized the importance of the program.
The program is crucial for protecting vulnerable populations, which he identifies as the state's top priority.
The program aligns with legislative mandates, especially in response to events like Winter Storm Uri.
Matt anticipates further discussion under item 3.1.3 on alternative ownership models.
He highlighted the importance of demand-side management amidst load growth, underlining the need for reliability and every megawatt as the state enters a new era.
Critical facilities with islanding capabilities and backup power are essential to ensure grid protection.
Emphasized the importance of using Texas backup power packages at critical facilities to address behind-the-meter operations and capacity needs during emergencies.
Suggested that ERCOT should utilize the TBPP fleet to enter islanded mode and operate on backup power to provide an extra gigawatt of power during emergency scenarios.
Acknowledged the significance of market design and the importance of price signals and formation.
Criticized the perceived hypocrisy of seeking subsidized gas plants while opposing small resource contributions like TBPP.
Noted that TBPP resources do not significantly impact price formation or profits for the majority of the year.
Highlighted that TBPP resources primarily operate for facility self-protection or to avoid high prices, and not for grid injection.
Stressed the need for flexibility in the use of TBPP resources, arguing against restrictions that limit their use only to grid failure situations.
Concluded that when facing an EEA2 situation, minor TBPP contributions will not meaningfully alter market prices.
She agreed with commenters on the aim of a program to benefit critical loads providing public safety or health benefits.
NRG supports using backup power packages outside emergency situations to increase value and better utilize taxpayer dollars.
The program can comply with statutes by preventing the sale of electricity into the market for energy or ancillary services and ensuring packages can immediately island.
Mandy disagreed with the electric cooperatives representative who claimed that using packages outside emergencies is a market sale, arguing it merely offsets grid consumption and reduces bills.
Alison Silverstein emphasized the importance of the Texas Back Up Power projects in preventing extended power outages like those during winter storm Uri.
The aim is not only to provide critical facilities with backup power but also to facilitate better outage management.
Utilities should be able to rotate loads more effectively, preventing prolonged outages for customers.
Critical facilities having backup power means utilities are not constrained by these facilities when managing power outages.
Silverstein noted that 90% of Texas distribution feeders contain a critical facility, underscoring the need for efficient backup systems to manage outages equitably.
3.1.2 - How can the features of a TBPP provide added value for a critical facility compared to purchasing and installing a generator set? How can this value be quantified relative to the cost of additional TBPP features?
Ned Bonskowski appreciated comments highlighting multiple value streams for backup power packages beyond just economic utilization.
There are tensions between economic utilization and investment incentives for bulk power system generation facilities.
Frequent reliance on economic utilization of backup generation may undermine investment in large-scale generation.
Current market design does not support parallel paths for resolving these tensions, which his company supports.
3.1.3 - How can contracts for alternative ownership models and financing mechanisms be structured to comply with statutory requirements? If these models and mechanisms are considered, what metrics could effectively measure value, performance, and compliance for the TBPP program?
Third-party ownership models, like resilience as a service, are beneficial for critical facilities by reducing capital burden and ensuring long-term performance.
Discussion on performance metrics includes a 48-hour duration requirement and performance against actual outages.
The ERS model is seen as helpful for establishing minimum availability metrics for backup power packages, aiming for 95% availability.
Backup power systems combined with electric utility service can deliver 99.999% reliability for customers.
Hybrid availability of grid service and backup power enhances reliability coverage.
3.2 - Flexibility and Applicability of Technical Specifications
3.2.1 - How can specifications include performance-based factors for design, installation, or operation without overly burdening a critical facility in installing or maintaining a TBPP?
Discussion on whether to have set specifications for projects or offer custom options.
Comparison to the energy efficiency industry where prescriptive and custom solutions exist.
Advocacy for the Commission to include a custom option pathway alongside set designs.
Recommendation for performance-based items involving design, installation, and operation.
Important design elements: capability for significant runtime, low environmental footprint, and economic savings.
Installation should include a mutually agreed upon construction and operation timeframe.
Operational focus on generator availability, runtime per year, and cold weather preparedness.
Incentive design should tie to both commercial operation and performance milestones.
Discussion on limits of grants and timing of delivery, including the need for possible multiple rounds of grants.
Comment on the issue of oversizing batteries as a significant cost factor.
3.2.2 - Should the specifications vary based on the size, type of critical facility, or other criteria? If so, how and for what reasons? How can the specifications be refined to encourage participation from or integration with existing backup facilities?
Discussion on the need for unique evaluations for critical facilities, specifically for protecting critical loads.
Consideration for deploying TBPP (Texas Backup Power Package) for critical facilities to back up noncritical circuits.
Importance of flexibility in investment and application to ensure program attractiveness and cost-effectiveness for critical facilities.
Observation that most customers prefer whole facility backup over separating critical from non-critical loads.
Advocacy for flexibility based on unique needs and tolerances of customers related to resiliency risks.
Discussion on standardization of communications and cybersecurity with a focus on flexibility to cater to different risk profiles and customer needs.
Note that distributed resources are not subject to NERC critical infrastructure protection standards.
Highlight that Enchanted Rock maintains high cybersecurity standards voluntarily to protect customers demanding such protection.
Important to right-size investment and solutions tailored to different customer needs.
3.2.3 - Considering that access to natural gas or propane may be limited in different geographic areas of the state, how, if at all, can specifications be expanded to include alternative technologies and fuels?
MainSpring's technology is centered around fuel flexibility for linear generators, capable of running on various gaseous fuels without hardware modifications.
The technology is beneficial for reliability and environmental reasons, supporting biogas, hydrogen, propane, and natural gas.
There is a suggestion to view running on gaseous fuels as a minimum standard, not a maximum, for technology incentives.
MainSpring advocates for larger incentives for technologies able to run on multiple fuels, as they offer greater reliability but are more costly.
Recommendations include considering a sliding scale for incentives based on performance goals, with different levels for varying technology capabilities.
Clarification is needed to confirm that biogas and refined biogas (RNG) are eligible fuels under current laws.
It's important to verify if laws require actual operation on natural gas and propane or just design capability to use these fuels.
Ensuring clarity on fuel usage options is critical so there is no confusion over customer capabilities for backup power solutions.
3.3 - Supply Chain & Deployment
3.3.1 - Considering vendors that may utilize alternative fuel sources or other components that can meet the performance criteria, how could the Commission consider adapting the specifications to increase the number of vendors eligible to participate in the program and support other business models?
Emphasis on importance of vendor qualification and approval per statutory requirements.
Discussion of package criteria: designed for purpose, but flexible with criteria such as 48-hour duration and three technologies capable of islanding.
Importance of flexibility and clarification on behind meter services to attract a broad number of vendors.
Need for certainty in claims, pricing, and solutions marketing if vendors are to recruit new critical facilities.
Discussion on other business models enabling TBPP deployment, and implications if a critical facility exits the program.
3.3.2 - How might other business models enable TBPP deployment by reducing the potential limitations or constraints that a critical facility may face when installing or maintaining a TBPP? What would the implications be if a critical facility exits the program?
Matt Boms discussed advocacy for 'resilience as a service' and lease-to-own models for the backup power program.
Highlighted that such models are currently effective in the free market, especially for the electric school bus segment.
Mentioned that these models help make upfront costs more accessible for critical facilities lacking resources.
Emphasized the importance of providing technical assistance to critical facilities within grant programs.
Suggested that technical support could help facilities choose suitable backup power packages and understand maintenance costs over time.
3.33 - How can vendors, including those with alternative business models, address supply chain disruptions to ensure timely deployment and adequate preparedness for emergencies?
