Forecasts in 2012 of diminishing resource adequacy set the stage for a push by generators and the Public Utility Commission of Texas (PUC) to vastly increase government intervention in Texas’ world-class electricity market. A more accurate assessment of the data since then has debunked the notion that Texas needs to adopt a capacity market with subsidies to generators as high as $4 billion a year—on top of what Texans pay for electricity. 

In May 2016, the Electric Reliability Council of Texas (ERCOT) forecast historically high levels of reserves: 18.2% for 2017 (as opposed to a 12.84% forecast in 2014), and 25.4% for 2018 (almost double the forecast made for that year in 2014). Thanks to its competitive electricity market, Texas has adequate resources to power Texas’ growing economy for at least the next 10 years. The Foundation’s research substantiates the underlying reason for future resource adequacy; new investment in generation is generally profitable and sufficient to keep up with increased demand.