The energy fund would be administered and used only by the Public Utility Commission of Texas to provide loans and grants to maintain and upgrade electric generating facilities.
The biggest chunk of the fund, $7.2 billion, would go into loans and incentives to build new power-generating facilities in the ERCOT (Electric Reliability Council of Texas) region.
The proposal, titled Proposition 7, is one of several efforts by lawmakers and regulators in Texas to avoid another energy crisis like the one caused by a deadly winter storm in February 2021.
That storm, known as Winter Storm Uri, left millions without power, water and heat for days as ERCOT struggled to prevent a grid collapse after the shutdown of an unusually large amount of generation.
Pablo Vegas, president and CEO of ERCOT, emphasized the grid has become more “volatile” given the current resources.
“The complexities of managing a growing demand, and a very dynamic load environment with those types of resources becomes more and more challenging,” Vegas said Tuesday during a meeting of the ERCOT board of directors.
Vegas said one solution to overcome the challenge is investing in power production that is available on demand, like power plants fueled by natural gas. Those plants can help during times when the need for electricity strains the supply.
“With the passing of Proposition 7 on the ballot this November, we’ll see those incentives combined to incentivize a more balanced development strategy going forward,” Vegas told board members.
If Proposition 7 is passed by voters, it would enact S.B. 2627, which establishes an advisory committee to oversee the fund and the various projects it could be used for. $5 billion would be transferred from the General Revenue Fund to the Texas Energy Fund if Proposition 7 passes.
Opposition for Proposition 7 comes from the Lone Star chapter of the Sierra Club, an environmental organization based in Austin. Cyrus Reed, conservation director of the Lone Star chapter, said the Texas energy fund is slated to benefit private utilities to build gas plants using taxpayer’s money.