By Cyrus Reed and Shane Johnson
After meeting for several hours on March 9 in a special joint meeting, members of the City of Austin’s Electric Utility Commission (EUC) and Resource Management Commission (RMC) recommended approval of a revised and improved Austin Energy Resource, Generation, and Climate Protection Plan to 2030 (the 2030 Plan). The vote was unanimous, but the two Commissions voted in favor of resolutions to further improve the 2030 Plan due to significant concerns about lack of equity in the update process. The resolutions were identical except that the RMC made one important change: require an update in 2023 (which was not adopted in the EUC resolution).
“The proposed 2030 Plan -- with the improvements made during the special EUC-RMC meeting -- represents a groundbreaking and unique resource plan mapping the transition to renewable energy for the second largest public utility in Texas. The 2030 plan commits to lowering carbon emissions, creating more equitable and affordable solar and energy efficiency programs, and, perhaps most importantly, phasing out the use of both coal and gas resources by 2035 at the latest,” noted the Lone Star Chapter’s Conservation Director, Cyrus Reed. Cyrus is a member of both the EUC and the Resource Planning Working Group, which drafted the proposed 2030 Plan with input from the utility.
Under the proposed plan, which is being sent to City Council for final approval, Austin Energy commits to using internal carbon pricing to run its existing Fayette coal power plant approximately 30 percent less over the next two-and-a-half years, before closing the Austin-owned portion of the plant by the end of 2022. (The other owner of the plant -- the Lower Colorado River Authority has not made any commitments to close their portion of the plant). Austin Energy reaffirmed its commitments to close down the two primary steam units of the Decker fracked gas plants over the next two years as well. Ultimately, Austin Energy committed to extending its carbon pricing model (after Fayette shuts down) to the remaining gas units at Decker and the Sandhill fracked gas plant until they are retired by the end of 2035 or sooner. This plan to reduce dependency on fossil fuel plants is known as the REACH plan, which states:
“Upon City Council approval of this 2030 Plan, Austin Energy will adopt a new market-based approach to accelerate reduction of carbon emissions by its legacy generators in the most economic manner available. This approach, known as Reduce Emissions Affordably for Climate Health (“REACH”), will incorporate a cost of carbon in the generation dispatch price, allowing Austin Energy to reduce generation output during low-margin periods but keep the resources available for high-margin periods. Austin Energy will apply an annual amount of approximately2% of the prior year’s PSA to implement REACH. Austin Energy will continue to adhere to the CityCouncil affordability metrics through active portfolio management. The REACH plan is expected to reduce the utility’s carbon emissions by 30% or approximately 4 million metric tons between approval of this 2030 Plan and Austin Energy’s exit from FPP. Thereafter, the REACH plan is expected to reduce carbon emissions by 8% each year, while maintaining the flexibility to protect our customers’ rates in periods of high prices in the wholesale market, until achieving zero carbon emissions by 2035. Austin Energy will report semi-annually to the Electric Utility Commission and the City Council the realized reduction in carbon emissions from the REACH plan’s implementation.”
In terms of energy goals specifically, Austin Energy commits to getting 86 percent of its energy from carbon-free sources by 2025 -- including more than 60% renewables -- and replacing all of its retiring fossil fuel units with an equivalent amount of renewable energy, storage, and other technologies that don’t emit carbon by 2035. The 2030 Plan also eliminates any potential for additional nuclear power -- although we would continue to rely on the current nuclear plant for 23% percent of our power. This essentially means that in 2030, the greater Austin area would have at least 375 MWs of locally-sited solar, a cumulative total of 1200 MWs of demand response and energy efficiency, and 40 MWs of thermal storage, and by 2035, the greater Austin area would only rely on the existing nuclear power plant, solar and wind power, and energy storage to meet all of our electrical needs.
The 2030 Plan also commits Austin Energy to work with the Equity Office to determine a third party organization that can convene a series of community meetings over the course of a year to explore the barriers to expanding energy efficiency, demand response, and solar programs to limited-income people and communities of color, while continuing to pilot, and eventually expand, the“shared solar” (for multi-family housing) and community solar programs.
In addition to these policy changes outlined in the 2030 plan, the EUC and RMC recommended to revise the 2030 Plan to address significant equity concerns. First and foremost, the Commission recognized a lack of equity considerations in the process updating the 2030 Plan and voted to require that Austin Energy work with the Equity Office in determining an improved future process that emphasizes community inclusion. This was an important improvement given that the current working group was not reflective of Austin’s diversity and took place during the work day, which made attending these meetings, despite being open to the public, very difficult for most Austinites.
On top of that, Austin Energy would be required to provide an annual report on research related to electric vehicles, demand response, electric storage and other new technologies designed to reduce reliance on fossil fuels. They would also have to report twice a year on how effective the carbon pricing efforts are at reducing emissions from their fossil fuel plants.
A copy of the resolution sent by the EUC can be found below:
RESOLVED, that the 2030 Plan as presented to the Electric Utility Commission be recommended to City Council for approval.
FURTHER RESOLVED, that the following additional items are recommended to the City Council:
- We recognize that there is no established process for appointment of members for the Working Group that ensures equity, and while efforts were made in 2020, challenges were identified. For this reason, we recommend that Austin Energy and the Electric Utility Commission work with the City of Austin Equity Office to establish a process that ensures future resource planning advisory or stakeholder groups include broad based customer representation, including representatives of residential and limited-income customer advocacy organizations and communities of color; and establishes open and transparent communications procedures providing access to all community members.
- We recommend that the community group meetings provided for on page 5 of the 2030 Plan should also include groups representing limited-income communities and communities of color.
- The City should ensure that the risks of the 2030 Plan do not disproportionality fall on limited income communities or communities of color.
- Austin Energy should report annually at the end of the fiscal year to the Electric Utility Commission with respect to progress on the research provided for on page 6 of the 2030 Plan
The RMC took similar action, except they added an additional recommendation: - At the end of 2022 the EUC will initiate a review process for the 2030 Plan, to take place in 2023.
The EUC instead recommended that the EUC decide by the end of 2022 whether an update is needed.
So what’s next?
The EUC and RMC recommendations, along with the 2030 Plan itself, are officially being submitted to the City Manager and City Council for further action. While the 2030 Plan could be placed on the agenda as soon as March 26th, it is most likely the plan will be considered by City Council near the end of April. The Lone Star Chapter of the Sierra Club is supportive of the 2030 Plan with the revisions from the Commissions, and the local Austin group of the Sierra Club is expected to take an official position soon. However, the Chapter strongly encourages additional community input from organizations or people who were left out of the process or have additional ideas.
Cyrus Reed is the interim director of the Lone Star Chapter of the Sierra Club and serves on the City of Austin’s Electric Utility Commission.
Shane Johnson is the Lone Star Chapter’s Clean Energy Distributed Organizer and serves on the City of Austin’s Resource Management Commission.