Crypto-mining and artificial intelligence could raise Texas electricity prices 70% by 2030
"Texas is especially vulnerable because the state's Public Utility Commission and the Electric Reliability Council of Texas have no authority to stop new data centers from demanding more power." There is another alternative which can provide the data centers with electricity without burdening existing ratepayers or taxpayers. That alternative, which we call Consumer Regulated Electricity or CRE, would open the state's electricity sector to the creation of new utilities ("CRE Utilities") for the first time in what may well be a century.
How would CRE Utilities improve upon the current situation?
(1) CRE Utilities would be islanded, meaning that they wouldn't connect to a regulated grid. As such, CRE Utilities couldn't impose new risks or costs upon ERCOT and the state's other grids.
(2) CRE Utilities would focus on the new large loads like data centers. This means that CRE Utilities wouldn't be cherry-picking customers from the existing utilities and ERCOT leaving existing costs to be spread over a declining base.
(3) Since CRE Utilities wouldn't impact a regulated grid and since their customers would be large, sophisticated entities, there wouldn't be a need for PUC oversight. Agreements between CRE Utilities and their customers would be no different than any other type of supply arrangement between large, sophisticated entities.
(4) CRE Utilities would be able to develop projects and innovate much more rapidly than will ever be possible within the traditional, PUC regulated sector. Speed and innovation are tremendously valuable to the data center industry. That's why data centers would strongly consider CRE Utilities as an alternative to ERCOT and the traditional utilities.
The benefits of CRE to Texas could go beyond keeping the data centers off ERCOT and the existing utilities. If CRE were made legal (it requires new legislation) and it proved successful, it would help guarantee Texas' success as a global energy leader well past the energy transition. And just as importantly, CRE wouldn't require taxpayer money. Contact us to learn more!
