How ERCOT Works: A Brief Explainer of the Council’s Role in Providing Texas Power

A week ago, today, Texans found themselves in the dark while temperatures dropped below freezing. This week, the investigations begin into the causes of and reactions to the Texas blackouts.

Chiefly under the spotlight will be the Electric Reliability Council of Texas (ERCOT), the non-profit that has become nearly synonymous with last week’s turmoil.

ERCOT is tasked with overseeing the state’s grid and its associated electricity market. The council analogizes itself to an air traffic controller — facilitating commerce and monitoring the security of the process.

Its website states, “As the independent system operator for the region, ERCOT schedules power on an electric grid that connects more than 46,500 miles of transmission lines and 680+ generation units.  It also performs financial settlement for the competitive wholesale bulk-power market and administers retail switching for nearly 8 million premises in competitive choice areas.”

ERCOT charges a small fee per kilowatt of electricity traded on its market from generator to utility.

The board of directors appoints employees to oversee the day-to-day operations of the organization. ERCOT’s current president and chief executive officer is Bill Magness, who has held the position since 2016 and previously served as its general counsel.

Directly supervising ERCOT is the Public Utility Commission (PUC) which appoints members to the board. The PUC is governed by the Texas legislature, but its commissioners are appointed by the governor and must be confirmed by the Senate.

Each of the three commissioners — DeAnn Walker, Arthur D’Andrea, and Shelly Botkin — was appointed by Governor Greg Abbott. All three were unanimously confirmed by the Senate in 2019.

Below the ERCOT board is the Technical Advisory Committee which oversees various subcommittees, corrals advice from each, and makes recommendations to the board for actions or policies.

About 90 percent of Texas’ electricity infrastructure falls under ERCOT’s purview.

See the organizational chart ERCOT uses below.

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