RAP Recommends Adjusting Texas Market Rules to Value Flexibility


In comments, filed in August 2012, with the Public Utility Commission of Texas (PUCT) in its Project 40000, Proceeding to Ensure Resource Adequacy in Texas, RAP recommends that the state consider adjusting its wholesale market rules to value flexible resources. With the state’s high concentration of variable resources, the adjustments will drive investments to deliver value and reliability. RAP offers two ways to make those adjustments, one consistent with an energy only market that introduces forward and enhanced ancillary markets, and a second that introduces a differentiated capacity market that pays more for more valuable, flexible resources. These recommendations are not mutually exclusive.

These changes, driven by functionality and applying to both supply and demand side resources, would motivate investment and minimize the reserve margin needed to assure reliability. RAP’s market design adjustments deliver reliability at lower cost than other market designs would, offering a purpose-built wholesale power market for Texas circumstances.

In an October 2012 filing, RAP responds to recommendations made by other organizations in the proceeding. RAP suggests that an enhanced forward services market approach is consistent with existing market mechanisms and the PUCT’s goals. RAP encourages the PUCT to establish and stand by a set of priorities appropriate to the preferences and specific circumstances in the Texas market.

 View the Texas Project 40000 Docket here.