Item 12- Recommendation regarding Gas Peaker Units — original pdf

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ELECTRIC UTILITY COMMISSION RECOMMENDATION 20260112-012 January 12, 2026 Subject: Recommendation regarding consideration of gas peaker units for Austin Energy Motioned By: Seconded By: Recommendation The Electric Utility Commission recommends to the City Council that no action be taken regarding the purchase or commitment to purchase any natural gas peaking generators before the process committed to in the Austin Energy Resource, Generation and Climate Protection Plan to 2035 has been fully completed, including: 1. A full review of the results of the forthcoming all-resources RFP at the Electric Utility Commission and City Council to consider all alternatives for both generation and energy management within the Austin load zone - including transmission upgrades - that could identify the best alternatives to employ. 2. Austin Energy conduct a feasibility analysis and present the detailed results to the Electric Utility Commission and City Council. 3. The process includes robust community engagement with potential evening meetings to solicit feedback on possible sites for any possible additional gas peakers. The analysis of the alternatives shall include, but not be limited to, 1. Economic modeling of the most viable alternatives over a ten-year timeline. 2. Modeling of the carbon emissions and other air pollution emission of each of the options. 3. Analysis of important changes in the ERCOT market since the 2023 and 2024 Generation Plan modeling, including, approval of the 765 KV grid backbone, Real- Time Co-Optimization Plus Batteries (RTC+B), other completed and planned transmission upgrades, energy storage deployment in ERCOT, additional loads on the system, volatility, and regulations that could affect Austin Energy’s load zone requirements from 2025 to 2035. 1 of 2 Item 124. Review and analysis of the Austin Energy utility scale batteries to be installed by 2027 as to their effectiveness in providing significant in-load zone power requirements currently provided by the existing 200 MWs of Decker peakers. 5. Engineering analysis of cost and timeline to transition the ERCOT black start capability from the Decker peakers to one or more peaker units at Sand Hill. Rationale: The world is visibly suffering the damaging effects of a heating climate, human caused by burning fossil fuels. The Paris Climate agreement established a goal of limiting global temperature increase to a maximum rise of 1.5 degrees C. That amount of warming is already being reached in just ten years and continues heating on a dangerous trajectory. Mayor Watson attended the COP30 Conference in Belem, Brazil, representing the City of Austin in support of the need for effective action by major international cities as critical to the climate solution. The Austin Energy Resource, Generation and Climate Protection Plan to 2035 commits the utility to achieve Zero Carbon emissions in electric energy generation for Austin by 2035. Reaching our shared goal of Zero Carbon will require implementing bold plans with the best available renewable energy, storage, energy management, and transmission technologies during the transition period from 2025 to 2035. Austin Energy has just completed the purchase of a 100 MW x 4-hour battery and is in negotiations for additional batteries to be operational by 2027. Battery technology could replace most of the functionality of the Decker peakers. The All-Resources RFP has not been completed, studied and economically modeled to consider alternative energy generation sources and energy management solutions. The process steps in the Generation Plan have not been satisfactorily completed with Council and public input, specifically: Feasibility, Pre-Development, Development, and Construction. Vote: Against: Abstentions: Absent: Attest: 2 of 2