AICPA SOC Service Organizations - Certrec

ERCOT to Survey Customers about Cost of Power Outages


The Electric Reliability Council of Texas will survey residential, commercial and large industrial customers about the cost of power outages, as part of a larger study aimed estimating the value of electric reliability, state utility regulators said Tuesday.

“The demand for electricity is growing fast and the Public Utility Commission of Texas is focused on ensuring grid reliability,” PUCT Chairman Thomas Gleeson said in a statement.

The PUCT directed ERCOT to undertake the study in order to develop a Value of Lost Load, or VOLL, as part of the state’s work to develop an electric reliability standard. Setting a VOLL for the ERCOT market will also help commissioners evaluate the cost-benefit ratios of infrastructure improvements proposed by transmission and distribution utilities, the PUCT said.

“As we develop this next stage of reliability policy and consider what infrastructure improvements are necessary to meet growth in demand, it’s critical we hear directly from Texas consumers and understand their individual needs and financial considerations,” the commission said.

ERCOT has contracted with survey company PlanBeyond and economics consulting firm Brattle Group to administer the survey and analyze the results. The survey itself was developed by the Lawrence Berkeley National Laboratory and has been used nationally, PUCT said.

The PUCT said ERCOT and Brattle “are working with transmission and distribution utilities and electric providers across the state to administer the survey to a diverse set of customers.”

A PUCT market analysis in January included a range of interim VOLL values that regulators could consider until the survey is complete.

One figure provided by Brattle, using uncapped commercial and industrial values, estimated system-wide VOLL at $67,822/unserved MWh. Staff proposed an interim VOLL be set at $25,000/MWh, but also recommended that any study that uses VOLL as an input “should conduct a sensitivity analysis, varying VOLL between $20,000 and $70,000 per MWh,” according to a January PUTC filing.

Following Winter Storm Uri in 2021, state lawmakers directed the commission to develop a reliability standard to improve grid reliability. Stakeholders have recommended a variety of metrics be used in setting the standard, including loss of load expectation, loss of load hours, expected unserved energy, VOLL and others.