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Higher revenues prompt Texas power makers to dust off old plants for summer

Chron logo Chron 2/7/2019 L.M. Sixel
NRG Energy is outfitting its W.A. Parish power plant in Fort Bend County with new infrastructure to capture carbon dioxide from coal burned in one of the plant s generators instead of releasing it into the atmosphere. The new facility will pipe the greenhouse gas to an oil field for use underground in enhanced oil recovery. (NRG Energy photo) © NRG Energy / NRG Energy

NRG Energy is outfitting its W.A. Parish power plant in Fort Bend County with new infrastructure to capture carbon dioxide from coal burned in one of the plant s generators instead of releasing it into the atmosphere. The new facility will pipe the greenhouse gas to an oil field for use underground in enhanced oil recovery. (NRG Energy photo)

A group of Texas power generators that produce about 60 percent of the state's electricity are planning to invest more than $100 million in existing generation facilities to prepare for the upcoming summer demand for electricity.

The Texas Competitive Power Advocates which includes NRG Energy, Calpine, Vistra Energy, Tenaska and Talen Energy, are making the investments after Texas regulators last month agreed to changes in the wholesale electricity market, a move that is expected to increase revenues for power generators during times of peak demand and raise prices for consumers and businesses.

Power companies have been telling the Public Utility Commission that unless upward price adjustments are made to what's known as the operating reserve demand curve, generators would have little incentive to build new power plants or fix up old ones to accommodate population growth and the threat of power shortages.

Texas is heading into the summer with a record low power reserve margin of 7.4 percent, just over half of the reserve margin goal of 13.7 percent set by the state's grid manager the Electric Reliability Council of Texas. The margin is the cushion state regulators rely upon to provide a steady supply of power in the event temperatures becomes unseasonably hot or generators break down unexpectedly.

Members of the power generation group have decided to continue operating plants that had previously been under consideration for retirement,  said executive director Michele Gregg. They are also reviewing projects to add additional capacity to the grid.

Gregg said the members have not identified which generation plants have been earmarked for additional investment.

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