Weather Alert

Financial impact of CPS Energy issues during freeze on customer billing unclear

FORT WORTH, TX - FEBRUARY 18: A swinging bench hangs from a tree after a snow storm on February 18, 2021 in Fort Worth, Texas. Winter storms have brought historic cold weather and power outages to Texas. Residents have gone days without electricity and fresh water after a catastrophic failure of the power grid in the state. (Photo by Ron Jenkins/Getty Images)

BEXAR COUNTY (KTSA News) — CPS Energy said Friday night it is not immediately clear how the costs of getting power on in San Antonio this past week will affect customer bills.

The utility said it experienced an unusually sharp increase in the cost of fuel and its costs to customers “may be substantial.”

“Our goal is always to keep our customers’ bill affordable,” CPS Energy said in a statement.

It is currently evaluating options to make that happen, which could include financing the expenses with bonds to pay it off through billing over years.  That plan would only be viable if it is approved.

CPS Energy said it will continue working with its board of trustees and the San Antonio City Council to find the most financially feasible solution for the community.

It is not clear if the state’s investigations into ERCOT and other energy companies will have a mitigating impact on the expenses.

CPS Energy also came up with a FAQ sheet to answer many questions customers may have about what happened.

Some highlights from CPS Energy:

Q: Why did my outages last so long? I thought they were “rolling” outages.
A: Under standard emergency procedures, rotating, or rolling, outages are targeted to last 10-15 minutes to reduce energy demand. The conditions during the winter weather emergency were not typical. The Texas power grid experienced record levels of stress due to the extreme and persistent freezing weather. As a result, ERCOT required electric utilities to urgently reduce the amount of electricity being used by customers across the state. The required reduction was greater than had ever been requested before. The process to reduce the demand for energy on the electric grid is called load shed and it is necessary to protect the grid from failing if electricity demand exceeds the available supply of electricity. Load shed is accomplished by turning off electrical circuits
connected to the grid. Because circuits connect customers to the grid, load shed turns off service to customers to reduce energy demand and protect the grid. To meet our required share of the load shed demand reduction, the duration of time circuits were off-line had to increase to a point where customers experienced extended outage periods and only brief periods of power. We adjusted our processes throughout this event to respond to the unprecedented levels of required load shed. We wanted to provide relief to customers who had been without power, but equipment limitations and failures occurred, resulting in the extended outage periods experienced by many. For customers who could be restored, we implemented longer cycles to maximize the
amount of time we gave customers to warm their homes, cook a meal, charge electronic devices, etc. Some customers could not be restored due to equipment issues, resulting in continuous loss of power.

Q: Why isn’t there a way of distributing the power outages so it isn’t such an extreme hardship on the ones that have been without power the longest?
A: A blackout of the statewide electric grid would be catastrophic. To help stabilize the state grid during times of extreme demand for electricity it is sometimes necessary to turn off some electric circuits that carry power to our customers. Not all electric circuits are turned off because some circuits provide power to critical facilities throughout our community. Critical facilities include hospitals, police stations, and fire stations.  Residents on the same circuits as critical facilities may not have initially experienced outages. Due to the extreme stress on the grid, some of these critical facilities and the homes on the same circuits eventually experienced outages.

Q: What is a critical circuit? Why aren’t I on a critical circuit?
A: Critical circuits have been identified to provide power to essential facilities such as hospitals, fire stations or police stations. Because we need these essential services in all weather conditions, we do everything we can to avoid outages on these circuits. If your home is near one of these essential facilities, you may be on a critical circuit.

Q: Will CPS Energy reimburse me for damages such as to my electronics, pool pump, and loss of perishable food?
A: We know it’s inconvenient and sometimes costly to experience a power outage. However, as a utility, we work to keep the power on for our customers but cannot control adverse weather conditions or equipment failures that can result in outages. Generally, we do not reimburse for any damages caused by weather-related outages. We advise customers to consult their insurance policies on what losses may be covered.

Q: If we were not connected to ERCOT, would we have still had outages?
A: Yes – Being connected to ERCOT is a safety net. If one or more of our power generation plants becomes unable to perform, we rely on ERCOT to provide the power we need to supplement the lost production to meet our community’s energy demand. When we have extra power, we sell electricity to ERCOT to supplement other utilities as needed.

Q: What was the main issue? Was it generation? Was it not weatherizing units?
A: There was insufficient power generated by the power sources supporting the ERCOT grid. Multiple factors, including the extreme weather, caused plants to be offline. Some power plants were undergoing planned maintenance in preparation for the summer season of high demand. A thorough analysis will be conducted.

Q: Why weren’t we prepared for something like this to happen? Will we be prepared in the future?
A: While we did pay very close attention to weather forecasts and began circulating messaging last week calling for energy conservation, this weather system had an unprecedented impact not only on Greater San Antonio, but across the entire state of Texas. We sent an English/Spanish telephone message to all customers we had phone numbers for on Sunday advising of the potential weather and asking for energy conservation.
As of Feb. 19, San Antonio experienced 6 straight days of freezing temperatures coupled with ice and several inches of snow. That is unheard of in our area. We normally see cold snaps that may last overnight, or even for a day or two, not longer. We manage our hot summer seasons, with help from the community to voluntarily reduce energy usage between the hours of 3:00 p.m. and 7:00 p.m. when demand is at its highest. Power plants in our state are not designed to run under sustained bitterly cold conditions. Once we are out of the crisis, we will carefully analyze operating
procedures to enhance our preparedness for future winter events.

Q: Should we change the way the grid is set up so this doesn’t happen again?
A: Texas has a robust grid system that normally performs very well throughout the year. This is an unprecedented, historic weather event. Lessons are sure to be learned and applied to future events and processes, but it is not possible to completely weatherproof the services of generating and providing power at a reasonable cost. CPS Energy will take this experience and look for opportunities to improve our response to these events in the future. We are always looking to improve upon the service we provide our customers and community. We have already improved processes during the duration of this event and will continue to do so.

Q: How is this event going to affect my bill?
A: The financial impact of the winter weather emergency has not yet been fully calculated, but it may be substantial. Our goal remains to keep our customers’ bills affordable.

Q: Why was power off for some SAWS pumping stations?
A: Most SAWS pump stations are on critical circuits and, as such, were initially excluded from controlled outages. As ERCOT continued to require additional load shedding, SAWS and CPS Energy jointly evaluated the challenges and made the decision to include some SAWS pump stations in the rotating outages in order to spare other critical sites, such as hospitals, police stations, and fire stations.

Q: Have the CPS Energy headquarter building’s lights remained on, and what message does that send to the public?
A: We do have some 24-hour operations at our downtown office building, and due to security reasons, we kept those lights on in that particular work area and the parking garage for security reasons. However, we curtailed our power use at the downtown building to minimum levels.

Q: Why were the downtown city lights excluded from controlled outages?
A: The downtown area of San Antonio is supplied by an electric grid design that has built in redundancy that is not uncommon for dense downtown areas with multiple highrise buildings. The nature of this grid design creates significant challenges in performing load shed operations on these circuits. The best option for this part of our system was customer conservation measures during the event.


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