Texas scraps $1B performance credit mechanism proposal as reliability benefits questioned

Robert Walton | Source: Utility DIVE | Posted 12/21/2024

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“We’ve spent countless hours evaluating the PCM — up until, literally, my last open meeting,” Commissioner Lori Cobos said Thursday. She announced her retirement in December.

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The Public Utility Commission of Texas has decided to set aside a proposed $1 billion Performance Credit Mechanism (PCM) for power generators, citing concerns that it would not contribute to improving grid reliability. The PCM, which was authorized by lawmakers last year, aimed to incentivize power generators in the Texas market during grid stress situations, but after thorough evaluation, the commission opted not to move forward with it.

Prior to the decision, Commissioner Lori Cobos, who recently resigned after nearly four years, mentioned the extensive analysis that went into evaluating the PCM. The commission unanimously agreed not to proceed with the PCM and instead focus on implementing other market design initiatives such as real-time co-optimization and a dispatchable reliability reserve service to enhance energy procurement and dispatch efficiency in ERCOT.

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Texas scraps $1B performance credit mechanism proposal as reliability benefits questioned

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