by Rick Counihan
On Sunday, June 18th, Governor Greg Abbott signed into law SB 1699 to encourage the use of residential demand response in Texas to help maintain grid reliability and reduce costs for residential consumers. The key feature of the legislation requires the Public Utility Commission of Texas (PUCT) to create a program for residential demand response. The bill also requires the commission to establish goals in the power region, which encompasses 26 million Texas customers and represents approximately 90% of the state’s electric load, to reduce the average total residential load.
The governor’s signing comes during a heat wave in Texas with the ERCOT region setting all-time records for peak consumption.
Texas uses the most energy of any state in the country but in past years has lagged other states in the amount of demand-response capability, especially in the residential sector. This could be a game changer for flexible load in Texas once the PUCT completes its rulemaking process.
Other provisions of the bill include:
- An addition to existing law stating that electric customers are entitled to participate in demand response programs.
- Authorization for the aggregation of distributed energy resources (DERs) without being deemed a generator and direction for the PUCT to set up rules for aggregators to follow.
The bill provides a variety of directions to PUCT for the residential program that it is to set up. They include:
- Promoting the adoption of smart metering technology
- Making sure the program participants can respond to emergency alerts from ERCOT
- Allowing demand response providers to contract with retail electric providers
- The program must not impact the critical needs of vulnerable populations
- Facilitating the widespread deployment of smart appliances and devices
- The program must provide for demand reductions in both summer and winter seasons
- Allowing retail electric providers to qualify for program funding under certain circumstances
The legislation goes into effect on September 1, 2023, with no deadline for when the PUCT has to complete the rulemaking process.