HOUSTON — Some electricity companies in Texas are planning to put less money into maintaining and modernizing plants, causing some officials to worry about energy reliability in the state.

Electricity companies are seeing less profit as other sources of electricity, such as wind and solar, have entered the market, the Houston Chronicle reported . Some companies are now planning to cease investments in modernizing plants and may begin shutting some down.

“Nobody saw this coming,” said Ed Hirs, an energy economist and professor at the University of Houston. “What ERCOT (the Electric Reliability Council of Texas) is concerned about is. . not having enough electricity for when you need it, for whatever reason.”

Regulated systems often build in the cost of keeping plants running while not in high demand into the rates set. However, Texas deregulated electricity in 2002. Since then companies have relied on price spikes during the hottest days of summer when demand is high to make money.

The state’s wholesale electricity market hasn’t been updated to keep up with the power industry’s new reliance on renewable sources that are intermittent so the state still needs coal, natural gas and nuclear plants to meet demand.

“There is a lot of uncertainty,” said Robbie Searcy, spokesperson for the council. “We do expect that some plants will retire. We don’t know which ones or when.”

Tom Alley is the vice president of research at the Electric Power Research Institute, a Washington nonprofit funded by the electric utility industry. He said paying power companies to be backups for renewable sources would keep the state’s power options diverse and ease concerns about reliability.

“The greatest challenge is that we don’t have a way to value diversity and we don’t have a way to value flexibility,” Alley said.

The Public Utility Commission will host a workshop Thursday to see what the state can do to protect the power grid’s reliability.

Plants are only required to give 90-day notice before shutting down in Texas.


Information from: Houston Chronicle, http://www.houstonchronicle.com