Texas PUC Moves To Drop 1-in-10 LOLE Reliability Metric, Potentially Publish 4 Alternative Metrics

The Public Utility Commission of Texas yesterday moved forward to drop use of the target 1-in-10 Loss of Load Expectation (LOLE) reliability standard, and potentially replace the target with four new metrics

Commissioner Kenneth Anderson said that his preference would be to eliminate the current LOLE target.

Subject to ERCOT feedback concerning costs and other issues, Anderson suggested publishing four metrics: the market equilibrium reserve margin, the economically optimal reserve margin, and, for each of those metrics, a conversion into expected unserved energy

Anderson suggested that the metrics be published every two to three years, with the frequency depending on the costs for ERCOT to calculate such standards

Chairman Donna Nelson emphasized concerns about the costs of publishing any new standards, and remains concerned about giving the impression that the reserve margin is required, when it is not mandated.

ERCOT was directed to provide information about costs to inform the Commission's decision at a future open meeting

Anderson noted that the current 0.1 LOLE implies one hypothetical loss of load event in 10 years, but ignores distribution-level disruptions, particularly from major storms