Preserving ERCOT’s Competitive Wholesale Market

Texas is home to the only truly competitive electric market in the world—Electric Reliability Council of Texas (ERCOT). Generation companies in ERCOT are paid only for the energy and real-time reserves they sell, not for simply owning a generator. The competitive market incentivizes top-notch performance from generation companies and has allowed businesses in Texas to thrive with a low-cost, reliable electricity supply. In recent years, old, inefficient and uneconomic generation units have retired, causing a temporary dip in installed capacity. This has encouraged some generation companies to seek radical market design changes to increase prices for customers without meaningfully impacting reliability. TAM supports maintaining ERCOT’s competitive market design and opposes market changes that would unjustly enrich generators at the expense of Texas customers.