AUSTIN, Texas – A $10 billion fleet of natural gas power plants for emergency use moved forward Monday in the Texas Senate.
The proposal is the centerpiece of a package aimed at shoring up the resiliency of Texas’ power grid since the 2021 deadly winter storm and could dramatically change how electricity is bought and sold.
The legislation could come up for a full vote as early as Thursday, said its author, Sen. Charles Schwertner, R-Georgetown. The bill was voted out of committee Monday despite some reservations from Democrats, who believe it amounts to reregulation of Texas’ laissez faire electricity market.
Senate Republicans and the chamber’s president, Lt. Gov. Dan Patrick, have placed a premium on passing legislation that would build natural gas power plants. The slate of bills by Schwertner and Sen. Phil King, R-Weatherford, aim to do that while also undermining booming investment in renewable energy in Texas.
“This is not a single-shot fix to what we need to do as a state, but I do think that the package in totality answers the concerns of the people of Texas,” Schwertner.
While regulators of Texas’ power grid have sought to encourage power companies to build new natural gas-fueled power plants in the state through tweeks to the marketplace that would favor those generators, the legislation — Senate Bill 6 — is a far more blunt approach.
It resembles a failed 2021 pitch from billionaire mega investor Warren Buffett that Schwertner supported. This year’s SB 6 would use taxpayer money or increases to Texans’ power bills to fund the construction of natural gas power plants capable of generating 10,000 megawatts of electricity – enough electricity to power as many as 7.5 million homes.
However, those generators would be paid to remain offline, operating as a “break in case of emergency” fashion that would only be called online when the state faces possible blackouts.
A representative from Buffett’s business conglomerate Berkshire Hathaway was the one of the few to testify in support of the bill at a recent hearing.
Critics of the proposal say it would actually undermine private investment in natural gas power plants and marks the end of Texas’ energy-only market, a design that only pays companies when they produce electricity.
The vote to advance the bill to the full Senate was 8-0-3, with the Senate Business and Commerce Committee’s three Democrats voting “present.”
Dallas Sen. Nathan Johnson, a Democrat, said he was concerned about how to preserve Texas’ competitive energy market with a backup power plant system of the proposed size.
“It ought to be brought back considerably in size and work in conjunction with other elements,” Johnson said. “It seems to wag the whole system at this size.”
The committee also unanimously approved two other measures that are elements of the total energy package of nine bills.
Some of those bills contain provisions that would tie renewable energy investment to natural gas and purposely leave emerging battery storage technology, industrial scale batteries that can stockpile and feed large amounts of electricity to the grid, out of contention for state-supported market designs. Those designs would favor dispatchable power generators that can provide power at the flip of a switch.
“I worry that some of the bills come across as anti-renewable,” said Sen. Judith Zaffirini, D-Laredo. “And so we want to make sure that we have the dispatchable energy that we have, but not necessarily hurt, not punish renewables.”
