Public Utility Commission asks for Final Order in LP&L’s bid to join ERCOT

By: Matt Dotray |

The Public Utility Commission gave Lubbock Power & Light a few more instructions Thursday, and predicts a final vote on LP&L’s bid to join the Electric Reliability Council of Texas grid should take place at the next meeting March 8.

With LP&L having already entered into agreements with both parties, there was thought the PUC may cast a final vote Thursday. But during the meeting, the three-member board accepted the agreements, and directed representatives of LP&L to draft a final order with a few specific details for final approval at the commission’s next meeting.

“I am excited about today’s meeting of the Public Utility Commission,” Lubbock Mayor Pro-Tem Latrelle Joy said in a news release. “This is a major step forward in the integration of LP&L into the ERCOT system and we look forward to the entry of the final Commission order on March 8.”

LP&L is applying to join the ERCOT grid after its wholesale contract in the Southwest Power Pool ends in 2021. There’s been written comments, public testimony, and negotiations over the course of several years now. Texas’ three-member PUC is the ultimate decision maker as to whether Lubbock’s city-owned electric provider can disconnect from the Southwest Power Pool and connect to the ERCOT system.

ERCOT and SPP have expressed concerns for the customers, and LP&L reached an agreement with both parties.

LP&L reached an agreed to pay ERCOT $110 million for infrastructure needed to connect Lubbock to the state’s grid. LP&L officials said they agreed in principal to pay $22 million per year for five years, totaling $110 million, to help mitigate some of ERCOT’S concerns over the cost ERCOT customers would incur from the estimated $360 million for transmission lines to connect Lubbock.

Upon integration, LP&L officials announced a few weeks ago its officials have agreed to make a one-time payment of $24 million to SPS, or Xcel Energy.

LP&L has not publicly discussed specific cost-saving numbers, but LP&L officials keep saying the cost savings associated with the move will result in a net savings despite these added payments.

A few things the PUC directed LP&L to address before the next meeting include matters like when LP&L will be able to turn on its generating station and seek recovery, assignments of capital projects needed for connection, and the need for LP&L to provide updates after the PUC vote.

“Today’s direction by the commissioners of the Public Utility Commission of Texas constitutes the most important milestone to date in our case to join ERCOT and we sincerely appreciate the diligence shown by the commissioners in this vital matter for Lubbock,” LP&L Director David McCalla said in a news release. “Moving to ERCOT accomplishes the long-term goals we set forth when we began this process over two years ago. It provides our customers a diversified portfolio of reliable and affordable Texas power for generations to come.”

Lubbock’s City Council unanimously approved a motion last month expressing its intent to provide customer choice for electricity — should Lubbock join ERCOT.

Public Utility Commission asks for Final Order in LP&L’s bid to join ERCOT