Item 6- Draft Recommendation Resource Reliability Study — original pdf

Backup

CITY OF AUSTIN RESOURCE MANAGEMENT COMMISSION RESOLUTION REQUESTING INDEPENDENT ANALYSIS OF CARBON-FREE RESOURCES ADDRESSING AUSTIN ENERGY’S 400-MEGAWATT RELIABILITY NEED CONSISTENT WITH CLIMATE EQUITY PLAN AND CLEAN ENERGY GOALS WHEREAS, the Austin Climate Equity Plan (2021) and Austin Energy's Resource, Generation, and Climate Protection Plan to 2035 — adopted unanimously by the Austin City Council in December 2024 — commit the City and its municipal utility to 100% carbon-free generation by 2035 and net-zero emissions by 2040, and direct all procurement and investment decisions to align with those goals; and WHEREAS, Austin Energy has identified approximately 575 annual reliability risk hours in the Austin load zone and determined that approximately 400 megawatts of additional dispatchable capacity is needed to address that risk, with an estimated budget of approximately $1 billion — a commitment of sufficient scale to warrant rigorous, independent evaluation of all available pathways; and WHEREAS, the technology landscape for carbon-free reliability resources has changed dramatically, with utility-scale and customer-scale battery storage costs continuing to decline, grid reconductoring enabling greater effective capacity from existing infrastructure, demand response programs achieving reliability performance previously associated only with centralized generation, time-of-use and real-time pricing programs reshaping peak load curves; and WHEREAS, a comprehensive portfolio of these carbon-free demand-side and grid- side resources — evaluated individually and in combination — may be capable of addressing all or a substantial portion of the identified 400-megawatt reliability need at total cost competitive with or below the approximately $1 billion budget, while advancing Austin's climate goals and providing year-round grid benefits rather than capacity dispatched only during reliability events; and WHEREAS, an independent, out-of-state technical consultant with no financial interest in any generation technology, vendor, or regional market is best positioned to evaluate these alternatives objectively and with access to the most current national experience deploying carbon-free reliability resources at scale; now, therefore, THEN BE IT RESOLVED that the Resource Management Commission urges that the approximately $1 billion identified to address the 400-megawatt reliability need be invested in a manner fully consistent with the Austin Climate Equity Plan and the 2035 Resource Plan; and BE IT FURTHER RESOLVED that the Resource Management Commission requests that Austin City Council directs the Financial Services Department to engage an independent, out-of-state third-party technical consultant — selected through a competitive process with no financial relationship to any generation technology vendor, equipment manufacturer, or regional market participant — to conduct a comprehensive, publicly available analysis of carbon-free resource portfolios capable of addressing the identified 400-megawatt reliability need within the approximately $1 billion budget, and BE IT FURTHER RESOLVED that the analysis evaluate, at a minimum: (1) utility-scale and customer-scale battery storage; (2) grid reconductoring and transmission upgrades to increase effective import capacity into the Austin load zone; (3) expanded demand response programs; (4) time-of-use and real-time pricing pass-through structures; (5) vehicle-to-grid and smart EV charging programs; and (6) virtual power plants aggregating distributed solar and storage; and BE IT FURTHER RESOLVED that the analysis shall quantify the reliability contribution, lifecycle cost, carbon impact, and ratepayer cost of each resource type and portfolio scenario, assess whether any combination can meet Austin Energy's 575-hour annual reliability risk reduction goal at or below the approximately $1 billion budget, and identify any regulatory, contractual, or operational barriers to deployment along with recommended strategies to address them; and BE IT FURTHER RESOLVED that the findings be presented to the Resource Management Commission and the Electric Utility Commission in a duly noticed public meeting, with adequate time for Commission review and formal recommendation to the City Council, and that the Resource Management Commission reaffirms its strong support for Austin Energy's already-approved renewable energy and battery storage investments and urges their accelerated deployment as a near-term contribution to the City's reliability and climate goals.