Does Texas Need More Natural Gas Power?
In a unified front to Texans, Governor Greg Abbott and Lieutenant Governor Dan Patrick issued a joint statement earlier this month calling for an increase in the Texas Energy Fund. Voters approved creating the $5B fund to give low interest loans to build more natural gas power plants. Recently, ERCOT projected Texas electricity demand to double by 2030. In response, Abbott and Patrick quickly called for to double the fund to $10B as soon as possible. Undoubtedly, state lawmakers will take up the issue in the next legislative session beginning in January.
Abbott and Patrick have pushed for natural gas plants because they can turn on in a matter of minutes. In contrast, solar and wind farms rely on weather to create usable power. Texas was caught flat footed in February 2022, and officials want to make sure that never happens again.
Companies are chomping at the bit to apply for a piece of the Texas Energy Fund. The state has already received notices of intent to apply totalling $39B. That’s a lot of competition, and many projects won’t make the cut.
Supply, Demand, and Prices
In a broad sense, any new generation capacity is good. But natural gas is not the cleanest energy, and it follows normal commodity pricing. As power demand rises, so do electricity prices. However, more supply lowers prices. So, the Texas Energy Fund helps get more supply in the natural gas market. And as ERCOT said, Texas demand will rise. Texas will need to get those 150,000 MW from somewhere, and a healthy mix of power plants bolsters reliability.
Crypto mining has driven recent demand, and barring legal changes or crypto market swings, this activity will continue. Patrick wants to look into crypto mining as well as data centers. That’s because these two businesses do not make enough jobs compared to the strain they place on the Texas grid. What that will mean for crypto miners and data centers remains unclear.
Securing the Texas Grid
Will Abbott and Patrick get their wish for a larger Texas Energy Fund? It is too soon to tell. However, officials across the state agree the grid is a top priority. Everyone wants to make it better. And lawmakers should take up the issue in a few short months. However, you can lock in some certainty for your home’s retail power by shopping at https://www.texaselectricityratings.com/electricity-rates. You’ll find a wealth of plans, so you can snag the one that works best for your home.