Preserve ERCOT’s Competitive Wholesale Market

Texas is home to the only truly competitive electric market in the world, within the 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, low natural gas prices and increased renewable generation development has caused old, inefficient, and uneconomic generation units to retire, 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. TAM also supports evaluating the impact of subsidized renewable generation on reliability and market signals and considering whether intermittent generation should be responsible for addressing any adverse impacts.