An advisory committee of residents on Thursday selected which mix of energy sources it will recommend to CPS Energy’s board of trustees to power San Antonio over the next decade.
Two-thirds of the committee voted for Portfolio #2, of which 44% will come from natural gas or diesel fuel, plus renewables and battery storage.
While the committee’s decision is only a recommendation to trustees, who are expected to make a final decision early next year, it sets a precedent for how reliable, affordable and eco-friendly customers expect the utility’s energy sources to be over the next decade.
The plan recommended by the committee would add roughly 4,928 megawatts of generation capacity to the utility’s portfolio over the next seven years, including 1,380 from combined cycle natural gas and 808 from reciprocating internal combustion engines — large “car engines” that run on natural gas or diesel.
Another 500 megawatts will come from wind, 1,180 from solar and 1,060 from lithium battery storage.
Under this plan, CPS Energy would end its coal use in the next six years by shutting down Spruce 1 by 2028 and converting Spruce 2 to a natural gas plant by 2027, which would run indefinitely.
The plan does not include geothermal, hydrogen or nuclear; those sources may become more available and affordable in the near future, said Benny Ethridge, the utility’s executive vice president of energy supply. This mix aims to minimize CPS Energy’s reliance on the Texas grid, and to ensure the utility has dispatchable energy — meaning it can be turned on or off when needed.
“[This mix] allows us to add dispatchable generation alongside renewable generation so that we can actually support the intermittent nature of the renewables and use them to benefit our customers,” Ethridge told the San Antonio Report earlier this month after utility staff recommended this specific mix to the committee. “So for us, it’s about maintaining system reliability and affordability.”
According to a consultant’s financial models, the chosen mix would be more affordable for CPS Energy customers than the renewable-heavy mixes because it would require fewer upfront investments and fewer purchases from the Electric Reliability Council of Texas market.
CPS Energy’s rate advisory committee
It’s likely the board of trustees will vote for the committee’s recommendation.
They have done so both times the committee has made recommendations: first when it supported a 3.85% rate increase last December, and again in May when it voted to extend the utility’s energy efficiency program for another five years.
CPS Energy formed the rate advisory committee in 2021, following requests from climate activists for a full, open examination of the utility’s rate structure and its long-term plans for its power plants. The committee’s 21 members were chosen by CPS Energy’s trustees and San Antonio City Council members.
But critics of the committee, who hoped it would be more independent, say those recommendations were made because the utility’s staff guided the committee’s 21 members into agreeing with their choices and that the same thing has happened this time.
“It wasn’t the [committee] making this decision, it was CPS [Energy],” said DeeDee Belmares, a climate justice organizer with Public Citizen’s Texas office and committee member.
Ethridge defended the process.
Most utilities do not get input from customer advisory boards when weighing big decisions such as this, he said. Even for CPS Energy, he said, “It’s a first-time thing for us.”
CPS Energy shared nine portfolio options with the committee over several months, hosted seven community meetings and created a survey to allow customers to weigh in as well, said Dana Sootodeh, a CPS Energy spokeswoman.
Belmares points out that the recommended mix assumes that gas will be affordable and reliable, which it hasn’t been in the recent past. She noted one big reason customers saw higher bills this past summer was due to high gas prices, while multiple natural gas plants across the state failed during Winter Storm Uri.
“Wind saved us this summer — wind filled in where the gas plants were failing,” she said.
CPS Energy fossil fuel plants were available over 90% of the time from June through September, said CPS Energy spokeswoman Milady Nazir.
While natural gas has its drawbacks, it’s still the most reliable option that exists today, said the committee’s chairman Reed Williams. Williams encouraged the utility and committee members to think of this portfolio as a six-to-eight year plan rather than as a long-term solution.
“We’re closing down a baseload coal plant in a world that is politically controlled by people that don’t particularly like us, OK?” Williams said of ERCOT’s board of directors. “That’s what we’re trying to do, and we have to have their permission to do this. How do we get their permission? We get their permission by increasing our reliability.”
Several members, including Belmares, expressed their gratitude Thursday to the utility for its efforts to be more transparent, and on its decision to phase out coal.
Belmares added that she would like to see CPS Energy revisit its generation mix every two to three years, as technology continues to advance, especially given that the Inflation Reduction Act has money to help fund climate action efforts.
“I’m encouraged that the city is focused on securing the funding from the IRA,” she said. “I don’t feel like the potential from the IRA was communicated enough to the [committee] and I’d like to see that be the case.”