Houston Chronicle by L.M. Sixel Oct. 28, 2019
Businesses get big break on electricity transmission fees while consumers pay more
As temperatures climbed into the triple digits this summer, big commercial and industrial companies shut down production lines, sent employees home and fired up backup generators. These moves, however, weren’t made to avoid the temporary spikes that sent wholesale electricity prices soaring to the maximum $9,000 per megawatt hour, but rather to cut their transmission costs throughout the year — and ultimately shift them to consumers and small businesses.
In Texas, the rates commercial and industrial companies pay for transmission are determined by the amount of electricity they use during four, 15-minute periods of peak statewide power consumption during the previous summer months. If companies can estimate which hot days will cause the biggest strain on the state power grid — and many hire electricity consultants to alert them to these periods — companies can save millions of dollars in transmission costs.
A clever company that takes drastic steps, such as shutting down its operations during the four short periods, can slash annual transmission costs from $500,000 to zero, according to one study by the Washington firm FTI Consulting. But this practice —which has nearly doubled in just four years as companies take more power off the grid during the hottest days —is distorting the electricity market in Texas by shifting one of the fastest growing parts of electricity bills to residential and small business customers.
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https://www.houstonchronicle.com/business/energy/article/Businesses-get-big-break-on-electricity-14562485.php
