Generator Cites Texas PUC Action in Decision to Develop a New Peaking Plant

Independent power producer Calpine earlier this month said it was starting development efforts for a new approximately 425-megawatt peaking plant next to its Freestone Energy Center in Freestone County, Texas.

“These development efforts are warranted in light of the Public Utility Commission’s recent adoption of a framework for implementing a Performance Credit Mechanism designed to incent new generation,” Calpine said in a news release.

In January, the Texas PUC voted unanimously to adopt a PCM electric market design option and a set of guiding principles for implementation to strengthen reliability, accountability, and affordability of the Electric Reliability Council of Texas electric grid.

The Commission said it would defer implementation of all elements of the PCM until the 88th Texas Legislature has an opportunity to review the PCM and its guiding principles and provide guidance or direction based upon the market design option’s merits.

Calpine said that because the final design and implementation of the PCM will likely take a couple years, “we also are encouraged that the PUC and ERCOT will be developing ‘bridge’ solutions to create near-term incentives for building new dispatchable generation. Regulatory certainty on PCM will be critical as Calpine continues to move this project forward.”