ERCOT Issues RFP to Procure Capacity to Alleviate Winter Concerns

France 2025–2035 Energy Roadmap accelerates carbon neutrality via renewables expansion, energy efficiency, EV adoption, heat pumps, hydrogen, CCS, nuclear buildout, and wind and solar targets, cutting fossil fuels and emissions across transport, housing, industry.

Key Points

A national plan to cut fossil use and emissions, boost renewables, and scale efficiency and clean technologies.

✅ Cuts fossil share to 30% by 2035 with efficiency gains

✅ Scales solar PV and wind; revives nuclear with EPR 2

✅ Electrifies transport and industry with EVs, hydrogen, CCS

Paris is on the verge of finalising its energy roadmap for the period 2025–2035, with an imminent decree expected to be published by the end of the first quarter of 2025. This roadmap is part of France's broader strategy to achieve carbon neutrality by 2050, aligning with wider moves toward clean electricity regulations in other jurisdictions.

Key Objectives of the Roadmap

The energy roadmap outlines ambitious targets for reducing greenhouse gas emissions across various sectors, including transport, housing, food, and energy. The primary goals are:

• Reducing Fossil Fuel Dependency: Building on the EU's plan to dump Russian energy, the share of fossil fuels in final energy consumption is to fall from 60% in 2022 to 42% in 2030 and 30% in 2035.

• Enhancing Energy Efficiency: A target of a 28.6% reduction in energy consumption between 2012 and 2030 is set, focusing on conservation and energy efficiency measures.

• Expanding Decarbonised Energy Production: The roadmap aims to accelerate the development of renewable energies and the revival.

Sector-Specific Targets

• Transport: The government aims to cut emissions by 31, focusing on the growth of electric vehicles, increasing public transport, and expanding charging infrastructure.

• Housing: Emissions from buildings are to be reduced by 44%, with plans to replace 75% of oil-fired and install 1 million heat pumps.

• Agriculture and Food: The roadmap includes measures to reduce emissions from agriculture by 9%, promoting organic farming and reducing the use of nitrogen fertilizers.

• Industry: A 37% reduction in emissions is targeted through the use of electricity, biomass, hydrogen, and CO₂ capture and storage technologies informed by energy technology pathways outlined in ETP 2017.

Renewable Energy Targets

The roadmap sets ambitious targets for renewable energy production that align with Europe's ongoing electricity market reform efforts:

• Photovoltaic Power: A sixfold increase in photovoltaic power between 2022

• Offshore Wind Power: Reaching 18 gigawatts up from 0.6 GW

• Onshore Wind Power: Doubling capacity from 21 GW to 45 GW over the same period.

• Nuclear Power: The commissioning of the evolutionary power and the construction of six EPR 2 reactors, underpinned by France's deal on electricity prices with EDF to support long-term investment, with the potential for eight more.
   

Implementation and Governance

The final version of the roadmap will be adopted by decree, alongside a proposed electricity pricing scheme to address EU concerns, rather than being enshrined in law as required by the Energy Code. The government had previously abandoned the energy-climate planning. The decree is expected to be published at the end of the Multiannual Energy Program (PPE) and in the second half of the third National Low-Carbon Strategy (SNBC).

Paris's finalisation of its energy roadmap for 2025–2035 marks a significant step towards achieving carbon neutrality by 2050. The ambitious targets set across various sectors reflect a comprehensive approach to reducing greenhouse gas emissions and transitioning to a more sustainable energy system amid the ongoing EU electricity reform debate shaping market rules. The imminent decree will provide the legal framework necessary to implement these plans and drive the necessary changes across the country.

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Nuclear Power Revival drives decarbonization, climate change mitigation, and energy security with SMRs, Generation IV designs, baseload reliability, and policy support, complementing renewables to meet net-zero targets and growing global electricity demand.

Key Points

A global shift back to nuclear energy, leveraging SMRs and advanced reactors to cut emissions and enhance energy security.

✅ SMRs offer safer, modular, and cost-effective deployment.

✅ Provides baseload power to complement intermittent renewables.

✅ Policy support and investments accelerate advanced designs.

In recent years, nuclear power has experienced a remarkable revival in public interest, policy discussions, and energy investment. Once overshadowed by controversies surrounding safety, waste management, and high costs, nuclear energy is now being reexamined as a vital component of the global energy transition, despite recurring questions such as whether it is in decline from some commentators. Here's why nuclear power is "so hot" right now:

1. Climate Change Urgency

One of the most compelling reasons for the renewed interest in nuclear energy is the urgent need to address climate change. Unlike fossil fuels, nuclear power generates electricity with zero greenhouse gas emissions during operation. As countries rush to meet net-zero carbon targets, evidence that net-zero may require nuclear is gaining traction, and nuclear offers a reliable, large-scale alternative to complement renewable energy sources like wind and solar.

2. Energy Security and Independence

Geopolitical tensions and supply chain disruptions have exposed vulnerabilities in relying on imported fossil fuels, and Europe's shrinking nuclear capacity has sharpened concerns over resilience. Nuclear power provides a domestic, stable energy source that can operate independently of volatile global markets. For many nations, this has become a strategic priority, reducing dependence on politically sensitive energy imports.

3. Advances in Technology

Modern innovations in nuclear technology are transforming the industry. Small Modular Reactors (SMRs) are leading the way as part of next-gen nuclear innovation, offering safer, more affordable, and flexible options for nuclear deployment. Unlike traditional large-scale reactors, SMRs can be built faster, scaled to specific energy needs, and deployed in remote or smaller markets.

Additionally, advances in reactor designs, such as Generation IV reactors and fusion research, promise to address longstanding concerns like waste management and safety. For example, some new designs can recycle spent fuel or run on alternative fuels, significantly reducing radioactive waste.

4. Public Perception Is Shifting

Public opinion on nuclear power is also changing. While the industry faced backlash after high-profile incidents like Chernobyl and Fukushima, increasing awareness of climate change and energy security is prompting many to reconsider, including renewed debates such as Germany's potential nuclear return in policy circles. A younger, climate-conscious generation views nuclear energy not as a relic of the past, but as an essential tool for a sustainable future.

5. Renewables Alone Are Not Enough

While renewable energy sources like solar and wind have grown exponentially, their intermittent nature remains a challenge. Energy storage technologies, such as batteries, have not yet matured enough to fully bridge the gap. Nuclear power, with its ability to provide constant, "baseload" energy, as France's fleet demonstrates in practice, serves as an ideal complement to variable renewables in a decarbonized energy mix.

6. Government Support and Investment

Policymakers are taking action to bolster the nuclear sector. Many countries are including nuclear energy in their clean energy plans, offering subsidies, grants, and streamlined regulations to accelerate its deployment. For instance, the United States has allocated billions of dollars to support advanced nuclear projects, the UK's green industrial revolution outlines support for upcoming reactor waves, while Europe has classified nuclear power as "sustainable" under its green taxonomy.

7. Global Energy Demand Is Growing

As populations and economies grow, so does the demand for electricity. Developing nations, in particular, are seeking energy solutions that can support industrialization while limiting environmental impact. Nuclear energy is being embraced as a way to meet these dual objectives, especially in regions with limited access to consistent renewable energy resources.

Challenges Ahead

Despite its potential, nuclear energy is not without its challenges. High upfront costs, lengthy construction timelines, and public concerns over safety and waste remain significant hurdles. The industry will need to address these issues while continuing to innovate and build public trust.

Nuclear power's resurgence is driven by its unique ability to tackle some of the most pressing challenges of our time: climate change, energy security, and the growing demand for electricity. With advances in technology, changing perceptions, and robust policy support, nuclear energy is poised to play a critical role in the global transition to a sustainable and secure energy future.

In a world increasingly shaped by the need for clean and reliable power, nuclear energy has once again become a hot topic—and for good reason.

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Hourly Electricity Emissions Tracking maps grid balancing areas, embodied emissions, and imports/exports, revealing carbon intensity shifts across PJM, ERCOT, and California ISO, and clarifying renewable energy versus coal impacts on health and climate.

Key Points

An hourly method tracing generation, flows, and embodied emissions to quantify carbon intensity across US balancing areas.

✅ Hourly traces of imports/exports and generation mix

✅ Consumption-based carbon intensity by balancing area

✅ Policy insights for renewables, coal, health costs

In the United States, electricity generation accounts for nearly 30% of our carbon emissions. Some states have responded to that by setting aggressive renewable energy standards; others are hoping to see coal propped up even as its economics get worse. Complicating matters further is the fact that many regional grids are integrated, and as America goes electric the stakes grow, meaning power generated in one location may be exported and used in a different state entirely.

Tracking these electricity exports is critical for understanding how to lower our national carbon emissions. In addition, power from a dirty source like coal has health and environment impacts where it's produced, and the costs of these aren't always paid by the parties using the electricity. Unfortunately, getting reliable figures on how electricity is produced and where it's used is challenging, even for consumers trying to find where their electricity comes from in the first place, leaving some of the best estimates with a time resolution of only a month.

Now, three Stanford researchers—Jacques A. de Chalendar, John Taggart, and Sally M. Benson—have greatly improved on that standard, and they have managed to track power generation and use on an hourly basis. The researchers found that, of the 66 grid balancing areas within the United States, only three have carbon emissions equivalent to our national average, and they have found that imports and exports of electricity have both seasonal and daily changes. de Chalendar et al. discovered that the net results can be substantial, with imported electricity increasing California's emissions/power by 20%.

Hour by hour
To figure out the US energy trading landscape, the researchers obtained 2016 data for grid features called balancing areas. The continental US has 66 of these, providing much better spatial resolution on the data than the larger grid subdivisions. This doesn't cover everything—several balancing areas in Canada and Mexico are tied in to the US grid—and some of these balancing areas are much larger than others. The PJM grid, serving Pennsylvania, New Jersey, and Maryland, for example, is more than twice as large as Texas' ERCOT, in a state that produces and consumes the most electricity in the US.

Despite these limitations, it's possible to get hourly figures on how much electricity was generated, what was used to produce it, and whether it was used locally or exported to another balancing area. Information on the generating sources allowed the researchers to attach an emissions figure to each unit of electricity produced. Coal, for example, produces double the emissions of natural gas, which in turn produces more than an order of magnitude more carbon dioxide than the manufacturing of solar, wind, or hydro facilities. These figures were turned into what the authors call "embodied emissions" that can be traced to where they're eventually used.

Similar figures were also generated for sulfur dioxide and nitrogen oxides. Released by the burning of fossil fuels, these can both influence the global climate and produce local health problems.

Huge variation
The results were striking. "The consumption-based carbon intensity of electricity varies by almost an order of magnitude across the different regions in the US electricity system," the authors conclude. The low is the Bonneville Power grid region, which is largely supplied by hydropower; it has typical emissions below 100kg of carbon dioxide per megawatt-hour. The highest emissions come in the Ohio Valley Electric region, where emissions clear 900kg/MW-hr. Only three regional grids match the overall grid emissions intensity, although that includes the very large PJM (where capacity auction payouts recently fell), ERCOT, and Southern Co balancing areas.

Most of the low-emissions power that's exported comes from the Pacific Northwest's abundant hydropower, while the Rocky Mountains area exports electricity with the highest associated emissions. That leads to some striking asymmetries. Local generation in the hydro-rich Idaho Power Company has embodied emissions of only 71kg/MW-hr, while its imports, coming primarily from Rocky Mountain states, have a carbon content of 625kg/MW-hr.

The reliance on hydropower also makes the asymmetry seasonal. Local generation is highest in the spring as snow melts, but imports become a larger source outside this time of year. As solar and wind can also have pronounced seasonal shifts, similar changes will likely be seen as these become larger contributors to many of these regional grids. Similar things occur daily, as both demand and solar production (and, to a lesser extent, wind) have distinct daily profiles.

The Golden State
California's CISO provides another instructive case. Imports represent less than 30% of its total electric use in 2016, yet California electricity imports provided 40% of its embodied emissions. Some of these, however, come internally from California, provided by the Los Angeles Department of Water and Power. The state itself, however, has only had limited tracking of imported emissions, lumping many of its sources as "other," and has been exporting its energy policies to Western states in ways that shape regional markets.

Overall, the 2016 inventory provides a narrow picture of the US grid, as plenty of trends are rapidly changing our country's emissions profile, including the rise of renewables and the widespread adoption of efficiency measures and other utility trends in 2017 that continue to evolve. The method developed here can, however, allow for annual updates, providing us with a much better picture of trends. That could be quite valuable to track things like how the rapid rise in solar power is altering the daily production of clean power.

More significantly, it provides a basis for more informed policymaking. States that wish to promote low-emissions power can use the information here to either alter the source of their imports or to encourage the sites where they're produced to adopt more renewable power. And those states that are exporting electricity produced primarily through fossil fuels could ensure that the locations where the power is used pay a price that includes the health costs of its production.

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Hurricane Grid Resilience examines how utilities manage outages with renewables, microgrids, and robust transmission and distribution systems, balancing solar, wind, and batteries to restore service, harden infrastructure, and improve storm response and recovery.

Key Points

Hurricane grid resilience is a utility approach to withstand storms, reduce outages, and speed safe power restoration.

✅ Focus on T&D hardening, vegetation management, remote switching

✅ Balance generation mix; integrate solar, wind, batteries, microgrids

✅ Plan 12-hour shifts; automate forecasting and outage restoration

When operators of Duke Energy's control room in Raleigh, North Carolina wait for a hurricane, the mood is often calm in the hours leading up to the storm.

“Things are usually fairly quiet before the activity starts,” said Mark Goettsch, the systems operations manager at Duke. “We’re anxiously awaiting the first operation and the first event. Once that begins, you get into storm mode.”

Then begins a “frenzied pace” that can last for days — like when Hurricane Florence parked over Duke’s service territory in September.

When an event like Florence hits, all eyes are on transmission and distribution. Where it’s available, Duke uses remote switching to reconnect customers quickly. As outages mount, the utility forecasts and balances its generation with electricity demand.

The control center’s four to six operators work 12-hour shifts, while nearby staff members field thousands of calls and alarms on the system. After it’s over, “we still hold our breath a little bit to make sure we’ve operated everything correctly,” said Goettsch. Damage assessment and rebuilding can only begin once a storm passes.

That cycle is becoming increasingly common in utility service areas like Duke's.

A slate of natural disasters that reads like a roll call — Willa, Michael, Harvey, Irma, Maria, Florence and Thomas — has forced a serious conversation about resiliency. And though Goettsch has heard a lot about resiliency as a “hot topic” at industry events and meetings, those conversations are only now entering Duke’s control room.

Resilience discussions come and go in the energy industry. Storms like Hurricane Sandy and Matthew can spur a nationwide focus on resiliency, but change is largely concentrated in local areas that experienced the disaster. After a few news cycles, the topic fades into the background.

However, experts agree that resilience is becoming much more important to year-round utility planning and operations as utilities pursue decarbonization goals across their fleets. It's not a fad.

“If you look at the whole ecosystem of utilities and vendors, there’s a sense that there needs to be a more resilient grid,” said Miki Deric, Accenture’s managing director of utilities, transmission and distribution for North America. “Even if they don’t necessarily agree on everything, they are all working with the same objective.”

Can renewables meet the challenge?

After Hurricane Florence, The Intercept reported on coal ash basins washed out by the storm’s overwhelming waters. In advance of that storm, Duke shut down one nuclear plant to protect it from high winds. The Washington Post also recently reported on a slowly leaking oil spill, which could surpass Deepwater Horizon in size, caused by Hurricane Ivan in 2004.

Clean energy boosters have seized on those vulnerabilities.They say solar and wind, which don’t rely on access to fuel and can often generate power immediately after a storm, provide resilience that other electricity sources do not.

“Clearly, logistics becomes a big issue on fossil plants, much more than renewable,” said Bruce Levy, CEO and president at BMR Energy, which owns and operates clean energy projects in the Caribbean and Latin America. “The ancillaries around it — the fuel delivery, fuel storage, water in, water out — are all as susceptible to damage as a renewable plant.”

Duke, however, dismissed the notion that one generation type could beat out another in a serious storm.

“I don’t think any generation source is immune,” said Duke spokesperson Randy Wheeless. “We’ve always been a big supporter of a balanced energy mix, reflecting why the grid isn't 100% renewable in practice today. That’s going to include nuclear and natural gas and solar and renewables as well. We do that because not every day is a good day for each generation source.”

In regard to performance, Wade Schauer, director of Americas Power & Renewables Research at Wood Mackenzie, said the situation is “complex.” According to him, output of solar and wind during a storm depends heavily on the event and its location.

While comprehensive data on generation performance is sparse, Schauer said coal and gas generators could experience outages at 25 percent while stormy weather might cut 95 percent of output from renewables, underscoring clean energy's dirty secret about variability under stress. Ahead of last year’s “bomb cyclone” in New England, WoodMac data shows that wind dropped to less than 1 percent of the supply mix.

“When it comes to resiliency, ‘average performance’ doesn't cut it,” said Schauer.

In the future, he said high winds could impact all U.S. offshore wind farms, since projects are slated for a small geographic area in the Northeast. He also pointed to anecdotal instances of solar arrays in New England taken out by feet of snow. During Florence, North Carolina’s wind farms escaped the highest winds and continued producing electricity throughout. Cloud cover, on the other hand, pushed solar production below average levels.

After Florence passed, Duke reported that most of its solar came online quickly, although four of its utility-owned facilities remained offline for weeks afterward. Only one was because of damage; the other three remained offline due to substation interconnection issues.

“Solar performed pretty well,” said Wheeless. “But did it come out unscathed? No.”

According to installer reports, solar systems fared relatively well in recent storms, even as the Covid-19 impact on renewables constrained projects worldwide. But the industry has also highlighted potential improvements. Following Hurricanes Maria and Irma, the Federal Emergency Management Agency published guidelines for installing and maintaining storm-resistant solar arrays. The document recommended steps such as annual checks for bolt tightness and using microinverters rather than string inverters.

Rocky Mountain Institute (RMI) also assembled a guide for retrofitting and constructing new installations. It described attributes of solar systems that survived storms, like lateral racking supports, and those that failed, like undersized and under-torqued bolts.

“The hurricanes, as much as no one liked them, [were] a real learning experience for folks in our industry,” said BMR’s Levy. “We saw what worked, and what didn’t.”          

Facing the "800-pound gorilla" on the grid

Advocates believe wind, solar, batteries and microgrids offer the most promise because they often rely less on transmitting electricity long distances and could support peer-to-peer energy models within communities.

Most extreme weather outages arise from transmission and distribution problems, not generation issues. Schauer at WoodMac called storm damage to T&D the “800-pound gorilla.”

“I'd be surprised if a single customer power outage was due to generators being offline, especially since loads where so low due to mild temperatures and people leaving the area ahead of the storm,” he said of Hurricane Florence. “Instead, it was wind [and] tree damage to power lines and blown transformers.”

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Electricity System Climate Resilience underpins grid reliability amid heatwaves and drought, integrating solar, wind, hydropower, nuclear, storage, and demand response with efficient transmission, flexibility, and planning to secure power for homes, industry, and services.

Key Points

Power systems capacity to endure extreme weather and integrate clean energy, maintaining reliability and flexibility.

✅ Grid hardening, transmission upgrades, and digital forecasting.

✅ Flexible low-carbon supply: hydropower, nuclear, storage.

✅ Demand response, efficient cooling, and regional integration.

Summer is just half done in the northern hemisphere and yet we are already seeing electricity systems around the world struggling to cope with the severe strain of heatwaves and low rainfall.

These challenges highlight the urgent need for strong and well-planned policies and investments to improve the security of our electricity systems, which supply power to homes, offices, factories, hospitals, schools and other fundamental parts of our economies and societies. This means making our electricity systems more resilient to the effects of global warming – and more efficient and flexible as they incorporate rising levels of solar and wind power, as solar is now the cheapest electricity in history according to the IEA, which will be critical for reaching net-zero emissions in time to prevent even worse impacts from climate change.

A range of different countries, including the US, Canada and Iraq, have been hard hit by extreme weather recently in the form of unusually high temperatures. In North America, the heat soared to record levels in the Pacific Northwest. An electricity watchdog says that five US regions face elevated risks to the security of their electricity supplies this summer, underscoring US grid climate risks that could worsen, and that California’s risk level is even higher.

Heatwaves put pressure on electricity systems in multiple ways. They increase demand as people turn up air conditioning, driving higher US electricity bills for many households, and as some appliances work harder to maintain cool temperatures. At the same time, higher temperatures can also squeeze electricity supplies by reducing the efficiency and capacity of traditional thermal power plants, such as coal, natural gas and nuclear. Extreme heat can reduce the availability of water for cooling plants or transporting fuel, forcing operators to reduce their output. In some cases, it can result in power plants having to shut down, increasing the risk of outages. If the heat wave is spread over a wide geographic area, it also reduces the scope for one region to draw on spare capacity from its neighbours, since they have to devote their available resources to meeting local demand.

A recent heatwave in Texas forced the grid operator to call for customers to raise their thermostats’ temperatures to conserve energy. Power generating companies suffered outages at much higher rates than expected, providing an unwelcome reminder of February’s brutal cold snap when outages – primarily from natural gas power plants – left up to 5 million customers across the US without power over a period of four days.

At the same time, lower than average rainfall and prolonged dry weather conditions are raising concerns about hydropower’s electricity output in various parts of the world, including Brazil, China, India and North America. The risks that climate change brings in the form of droughts adds to the challenges faced by hydropower, the world’s largest source of clean electricity, highlighting the importance of developing hydropower resources sustainably and ensuring projects are climate resilient.

The recent spate of heatwaves and unusually long dry spells are fresh warnings of what lies ahead as our climate continues to heat up: an increase in the scale and frequency of extreme weather events, which will cause greater impacts and strains on our energy infrastructure.

Heatwaves will increase the challenge of meeting electricity demand while also decarbonizing the electricity supply. Today, the amount of energy used for cooling spaces – such as homes, shops, offices and factories – is responsible for around 1 billion tonnes of global CO2 emissions. In particular, energy for cooling can have a major impact on peak periods of electricity demand, intensifying the stress on the system. Since the energy demand used for air conditioners worldwide could triple by 2050, these strains are set to grow unless governments introduce stronger policy measures to improve the energy efficiency of air conditioning units.

Electricity security is crucial for smooth energy transitions
Many countries around the world have announced ambitious targets for reaching net-zero emissions by the middle of this century and are seeking to step up their clean energy transitions. The IEA’s recent Global Roadmap to Net Zero by 2050 makes it clear that achieving this formidable goal will require much more electricity, much cleaner electricity and for that electricity to be used in far more parts of our economies than it is today. This means electricity reaching much deeper into sectors such as transport (e.g. EVs), buildings (e.g. heat-pumps) and industry (e.g. electric-arc steel furnaces), and in countries like New Zealand's electrification plans it is accelerating broader efforts. As clean electricity’s role in the economy expands and that of fossil fuels declines, secure supplies of electricity become ever-more important. This is why the climate resilience of the electricity sector must be a top priority in governments’ policy agendas.

Changing climate patterns and more frequent extreme weather events can hit all types of power generation sources. Hydropower resources typically suffer in hot and dry conditions, but so do nuclear and fossil fuel power plants. These sources currently help ensure electricity systems have the flexibility and capacity to integrate rising shares of solar and wind power, whose output can vary depending on the weather and the time of day or year.

As governments and utilities pursue the decarbonization of electricity systems, mainly through growing levels of solar and wind, and carbon-free electricity options, they need to ensure they have sufficiently robust and diverse sources of flexibility to ensure secure supplies, including in the event of extreme weather events. This means that the possible decommissioning of existing power generation assets requires careful assessments that take into account the importance of climate resilience.

Ensuring electricity security requires long-term planning and stronger policy action and investment
The IEA is committed to helping governments make well-informed decisions as they seek to build a clean and secure energy future. With this in mind, here are seven areas for action for ensuring electricity systems are as resilient as possible to climate risks:

1. Invest in electricity grids to make them more resilient to extreme weather. Spending today is far below the levels needed to double the investment for cleaner, more electrified energy systems, particularly in emerging and developing economies. Economic recovery plans from the COVID-19 crisis offer clear opportunities for economies that have the resources to invest in enhancing grid infrastructure, but much greater international efforts are required to mobilize and channel the necessary spending in emerging and developing economies.

2. Improve the efficiency of cooling equipment. Cost-effective technology already exists in most markets to double or triple the efficiency of cooling equipment. Investing in higher efficiency could halve future energy demand and reduce investment and operating costs by $3 trillion between now and 2050. In advance of COP26, the Super-Efficient Equipment and Appliance Deployment (SEAD) initiative is encouraging countries to sign up to double the energy efficiency of equipment sold in their countries by 2030.

3. Enable the growth of flexible low-carbon power sources to support more solar and wind. These electricity generation sources include hydropower and nuclear, for countries who see a role for one or both of them in their energy transitions. Guaranteeing hydropower resilience in a warming climate will require sophisticated methods and tools – such as the ones implemented in Brazil – to calculate the necessary level of reserves and optimize management of reservoirs and hydropower output even in exceptional conditions. Batteries and other forms of storage, combined with solar or wind, can also provide important amounts of flexibility by storing power and releasing it when needed.

4. Increase other sources of electricity system flexibility. Demand-response and digital technologies can play an important role. The IEA estimates that only a small fraction of the huge potential for demand response in the buildings sector is actually tapped at the moment. New policies, which associate digitalization and financial behavioural incentives, could unlock more flexibility. Regional integration of electricity systems across national borders can also increase access to flexible resources.

5. Expedite the development and deployment of new technologies for managing extreme weather threats. The capabilities of electricity utilities in forecasting and situation awareness should be enhanced with the support of the latest information and communication technologies.

6. Make climate resilience a central part of policy-making and system planning. The interconnected nature of recent extreme weather events reminds us that we need to account for many contingencies when planning resilient power systems. Climate resilience should be integral to policy-making by governments and power system planning by utilities and relevant industries, and debates over Canadian climate policy underscore how grid implications must be considered. According to the recent IEA report on climate resilience, only nine out of 38 IEA member and association countries include concrete actions on climate adaptation and resilience for every segment of electricity systems.

7. Strengthen international cooperation on electricity security. Electricity underpins vital services and basic needs, such as health systems, water supplies and other energy industries. Maintaining a secure electricity supply is thus of critical importance. The costs of doing nothing in the face of growing climate threats are becoming abundantly clear. The IEA is working with all countries in the IEA family, as well as others around the world, by providing unrivalled data, analysis and policy advice on electricity security issues. It is also bringing governments together at various levels to share experiences and best practices, and identify how to hasten the shift to cleaner and more resilient energy systems.

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Texas Electricity Market Bailout proposes securitization bonds and ERCOT-backed fees after Winter Storm Uri, spreading costs via ratepayer charges on power bills to stabilize generators, co-ops, and retailers and avert bankruptcies and investor flight.

Key Points

State plan to securitize storm debts via ERCOT fees, adding bill charges to stabilize Texas power firms.

✅ Securitization bonds finance unpaid ancillary services and energy costs

✅ ERCOT fee spreads Winter Storm Uri debts across ratepayers statewide

✅ Aims to prevent bankruptcies, preserve grid reliability, reassure investors

An approximately $2.5 billion plan to bail out Texas’ distressed electricity market from the financial crisis caused by Winter Storm Uri in February has been approved by the Texas House.

The legislation would impose a fee — likely for the next decade or longer — on electricity companies, which would then get passed on to residential and business customers in their power bills, even as some utilities waived certain fees earlier in the crisis.

House lawmakers sent House Bill 4492 to the Senate on Thursday after a 129-15 vote. A similar bill is advancing in the Senate.

Some of the state’s electricity providers and generators are financially underwater in the aftermath of the February power outages, which left millions without power and killed more than 100 people. Electricity companies had to buy whatever power was available at the maximum rate allowed by Texas regulations — $9,000 per megawatt hour — during the week of the storm (the average price for power in 2020 was $22 per megawatt hour). Natural gas fuel prices also spiked more than 700% during the storm.

Several companies are nearing default on their bills to the Electric Reliability Council of Texas, which manages the Texas power grid that covers most of the state and facilitates financial transactions in it.

Rural electric cooperatives were especially hard hit; Brazos Electric Power Cooperative, which supplies electricity to 1.5 million customers, filed for bankruptcy citing a $1.8 billion debt to ERCOT.

State Rep. Chris Paddie, R-Marshall, the bill’s author, said a second bailout bill will be necessary during the current legislative session for severely distressed electric cooperatives.

“This is a financial crisis, and it’s a big one,” James Schaefer, a senior managing director at Guggenheim Partners, an investment bank, told lawmakers at a House State Affairs Committee hearing in early April. He warned that more bankruptcies would cause higher costs to customers and hurt the state’s image in the eyes of investors.

“You’ve got to free the system,” Schaefer said. “It’s horrible that a bunch of folks have to pay, but it’s a system-wide failure. If you let a bunch of folks crash, it’s not a good look for your state.”

If approved by the Senate and Gov. Greg Abbott, a newly-created Texas Electric Securitization Corp. would use the money raised from the fees for bonds to help pay the companies’ debts, including costs for ancillary services, a financial product that helps ensure power is continuously generated and improve electricity reliability across the grid.

Paddie told his colleagues Wednesday that he could not yet estimate how long the new fee would be imposed, but during committee hearings lawmakers estimated it’s likely to be at least a decade. Several other bills to spread out the costs of the winter storm and consider market reforms are also moving through the Legislature.

ERCOT’s independent market monitor recommended in March that energy sold during that period be repriced at a lower rate, which would have allowed ERCOT to claw back about $4.2 billion in payments to power generators, but the Public Utility Commission declined to do so, even as a court ruling on plant obligations in emergencies drew scrutiny among market participants.

Instead, lawmakers are pushing for bailouts that several energy experts have said is needed, both to ensure distressed companies don’t pass enormous costs on to their customers and to prevent electricity investors and companies from leaving the state if it’s viewed as too risky to continue doing business.

Becky Klein, an energy consultant in Austin and former chair of the Public Utility Commission who played a key role in de-regulating Texas’ electricity market two decades ago, said during a retail electricity panel hosted by Integrate that legislation is necessary to provide “some kind of backstop during a crazy market crisis like this to show the financial market that we’re willing to provide some relief.”

Still, some lawmakers are concerned with how they will win public support, including potential voter-approved funding measures, for bills to bail out the state’s electricity market.

“I have to go back to Laredo and say, ‘I know you didn’t have electricity for several days, but now I’m going to make you pay a little more for the next 20 years,’” state Rep. Richard Peña Raymond, D-Laredo, said during an early April discussion on the plan in the House State Affairs Committee. He said he voted for the bill because it’s in the best interest of the state.

Paddie, during the same committee hearing, acknowledged that “none of us want to increase fees or taxes.” However, he said, “We have to deal with the reality set before us.”

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