Energy policymakers grapple with reliability, fairness, and flexibility: Texas Grid Roundup #92

ERCOT's reliability standard process, the Texas Backup Power Package rule, and transmission cost allocation debates.

This Grid Roundup includes ERCOT’s reliability standard process, the Texas Backup Power Package rule, and ongoing debates over transmission cost allocation. While each proceeding is different, the policy question is similar: can Texas protect customers from reliability and cost risks without discouraging the flexible resources that could help solve them?

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Reliability standard takes shape

The Texas Public Utility Commission’s reliability standard is intended to serve as a benchmark of the likelihood of a power outage caused by demand exceeding available generation. If ERCOT’s analysis shows the system is unlikely to meet the standard, the result could be market design changes to send stronger signals for new resources.

The assumptions, especially the load assumption, used to forecast reliability of the system are critically important to provide an accurate reading. ERCOT is expected to model both 2026 and 2029, but there has been discussion about which forecast should be used. The original expectation was that the reliability standard would rely on the 2026 Regional Transmission Plan (RTP) forecast, but ERCOT has raised concerns that the RTP forecast may overstate how much load is actually likely to materialize. Information from transmission service providers suggests a 2026 peak of approximately 112 gigawatts, while ERCOT appears to expect the system is more likely on track for 90 to 98 GW. For reference, the peak in 2025 never exceeded 84 gigawatts.

Based on the latest discussion at the commission open meeting, ERCOT and the PUCT appear to be moving toward using the batch zero forecast instead, reflecting ERCOT’s new batch framework for interconnecting large loads. That may produce a more realistic picture of near-term load growth because batch zero is intended to sort large load projects based on readiness and likelihood of interconnection, but it also pushes the timeline out. The batch zero forecast is expected to be completed in mid-August, the reliability standard report is expected in December, and any decisions by the PUCT on market changes would likely occur in the first half of 2027. A revised timeline is expected to be presented at the June 18 open meeting.

This revised timeline may be helpful. The additional time gives ERCOT