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Could Texas outages happen in Indiana?

Utility operators, regulators say Texas winter outages couldn’t happen here

INDIANAPOLIS — Following a winter storm that left millions of Texans without power, the Senate Utilities Committee asked energy regulators and suppliers to share their “lessons from Texas” and determine whether Indiana had any vulnerabilities similar to Texas.

“I thought it would be a good time to bring together (stakeholders) to get their perspective on what happened in Texas and why we hope that never happens here,” state Sen. Eric Koch, R-Bedford, said.

The Midcontinent Independent System Operator (MISO), PJM Interconnection, the Indiana Energy Association and the Indiana Utility Regulatory Commission (IURC) testified before the Senate Utilities Committee, chaired by Koch, Thursday.

MISO and PJM, both regional transmission organizations, don’t generate electricity but oversee its movement from generation to homes and businesses.

Texas’ and Indiana’s energy grids differ in several, important ways: Texas’ grid operates independently of other states, meaning states with an energy surplus can’t sell to Texas to cover deficiencies, and Texas’ grid is largely deregulated.

As part of the Eastern Interconnection, Indiana can purchase power from its neighbors if its generators can’t operate or Indiana can sell excess energy to others.

Melissa Seymour, the executive director at MISO, said the regional transmission organization (RTO) operated throughout the country, including Indiana and a small portion of eastern Texas. Members of MISO include Indianapolis Power & Light, Duke Energy, Centerpointe and NIPSCO.

“The grid operator in Texas has to balance customer demand and resources inside the state of Texas and without a great deal of help from its neighbors,” Seymour said. “The majority of Texas is deregulated. Numerous retail electric providers compete to serve customers and are often independent of the generators who own the resources.”

In contrast to Indiana, electricity generators don’t have an obligation to serve specific regions of customers and rates are not set by the state.

Seymour explained that because MISO’s Texas portion shared grids with other Southern states, it could balance power demands and didn’t experience the same mass outages as greater Texas. Additionally, because Indiana utilities are regulated and don’t have wholesale prices, like Texas, consumers can’t be surprised with $9,000 electric bills.

“We are interconnected (in Indiana) so we can get from our neighbors,” Seymour said. “But our transmission systems (and Texas’) don’t talk to each other so there was no way to get them power.”

Committee member Sen. Shelli Yoder, D-Bloomington, tried several times to get answers about Indiana’s plans to withstand climate change, which exacerbates severe weather events such as last month’s winter storms.

Both regional transmission organizations, MISO and PJM, didn’t directly answer the question but said they follow policies established by the state.

“We are a policy taker, not a policy maker,” Evelyn Robinson, a managing partner of State Government Affairs with PJM, said. “We’re trying very hard to implement whatever policies any state has.”

Utility operators also discussed diversifying Indiana’s energy generators, drawing from coal, natural gas, wind, solar and nuclear. Ryan Hadley, the executive director of external affairs with IURC, said that coal accounted for roughly 54% of energy production compared to natural gas, 28%; nuclear, 10%; and wind or solar, 6%.

“We expect the utilities to look at all of the resources that are available to make sure they are meeting their customers’ needs first and foremost at the lowest reasonable cost,” Hadley said. “Generally what we are seeing is that it is resulting in a diverse portfolio of all different types of resources.”

Wind could be categorized as the cheapest to produce but excess can’t be stored for calm days, making it less reliable. Additionally, 32 of Indiana’s 40 counties that produce the most profitable wind have adopted ordinances blocking wind developments and preventing wind from expanding in the state.

Overall, testimony seemed to agree that Indiana was in a much better position than Texas when it came to reliable energy production, dissemination and system weatherization.“The challenges last month in Texas have certainly reminded us of the importance of the delivery of reliable electric and gas service,” Hadley, of IURC, said. “Very simply, in my mind, Texas faced Indiana-like weather and wasn’t prepared for Indiana-like weather.”

Emphasis added by SIREN.

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