Natural gas supply is a matter of life or death, so Texas should regulate it as such

This editorial is part of a series published by The Dallas Morning News Opinion to explore ideas and guidelines for strengthening electrical reliability. The full series can be found here: Keeping the Lights On.

The February blackouts reminded Texans that electricity is a matter of life and death. And the fuel used to generate electricity is also a matter of life and death, natural gas.

Texas, we have a serious discussion about whether we can trust the natural gas supply in an emergency.

A huge amount of electricity generation of all kinds froze during the February storm. Around 4.5 million people lost electricity and some died. A major problem was that natural gas power generators could not get the natural gas they needed to run.

We’re not highlighting the reliability of natural gas fuel because that was the only problem, or even the biggest problem, in February. We highlight it because while electricity regulators take steps to ensure power plants don’t fail in winter, natural gas regulators don’t.

On Tuesday, the Federal Energy Regulatory Commission released its report on the causes of the February power outages and recommendations to prevent a recurrence. The top-line recommendations largely include weathering power plants and making electricity companies accountable for fixing issues that emerged earlier this year. The Electric Reliability Council of Texas has already adopted these recommendations and work is ongoing.

However, some FERC recommendations are not yet in progress. Most of the problems with the fuel supply were due to the decline in natural gas production due to the sub-zero temperatures. The Commission proposes to require gas suppliers to implement cold weather plans. That will not happen.

What is happening, and addressing another concern of FERC, is that natural gas suppliers identify portions of the infrastructure that are critical to fueling power plants and ensure that equipment is not shut down during rolling blackouts. It sounds silly that power plants couldn’t get fuel to stop the outages because their fuel suppliers were losing power, but it happened in February. It happened 10 years ago too, and still the natural gas people didn’t get their paperwork with the electricity companies right.

This change only makes sense if a company registers as a critical natural gas supplier ready to operate in a weather emergency. For $ 150, a supplier can claim they’re not ready for winter and file an exemption with the Texas Railroad Commission, which regulates oil and gas.

While ERCOT keeps the power generators to regulatory standards, the Railroad Commission asks the fuel suppliers to volunteer.

Reliability costs money, and there are many routes to the top of the mountain. Regulators can require companies to spend the money to meet better reliability standards, as ERCOT does with weathering rules for electricity companies. Or regulators can pay for reliability through fees or a market mechanism.

We want both for those who supply power plants with natural gas fuel. Regulators should set reliability standards for power plants and let companies find out which technology or fuel meets those standards. If the natural gas supplier to a power plant cannot guarantee fuel in an emergency, that power plant may buy a tank of diesel as reserve fuel, invest in a natural gas storage facility, or install batteries that start up when the power plant is shut down.

The electricity regulators are looking for ways to create incentives for this investment, for example through the direct purchase of reliability services or the adjustment of the electricity market rules in order to favor reserve electricity generation capacities. The trick is to find the most efficient way to get Texans to spend just enough to stave off a disaster without driving up electricity bills so high that customers feel the pain and businesses don’t want to move here.

As our state energy policies lead the way to more electric vehicles, this fuel reliability issue becomes even more important. Because Texans know what happens when the lights go out, and we also know what happens when the gasoline runs out and cars don’t drive after devastating hurricanes. Imagine both happening at the same time.

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