“ERCOT market reform proposal draws fire”
Including marginal line losses in Texas power market dispatch calculations would save little in production costs, boost power prices and emissions in load centers, suppress power prices in rural areas and cut revenues to remote renewable resources, electricity experts said Friday.
Implementing marginal losses would increase the load-weighted average locational marginal price paid to generation in the Houston Hub by less than 0.8% while decreasing the West Hub LMPs paid to generation by almost 10.2%, the Brattle Group report states.
The load-weighted average LMPs paid by consumers in the Houston Load Zone would climb by almost 3%, the report states, and Katie Coleman, an attorney representing Texas Industrial Energy Consumers, said the marginal loss proposal “really hits” the Houston economy.
“There’s a limited ability to build new generation in Houston,” Coleman said. “So, I think one of the things you have to think about is from a policy standpoint is it a good idea to put something in play that is going to systematically hit one of the state’s most significant economic areas [with higher power prices] and the long-term impact that is going to have on investment in the region.”