Texas retailers call for changes in computer system administration

Texas electricity suppliers called for an overhaul after a consultant in charge of testing computer systems associated with startup of the troubled retail electricity pilot resigned. Suppliers have asked the Public Utility Commission to make changes in how the program is administered and asked for an accounting of the program's expenses and future needs.


By Ann de Rouffignac
OGJ Online

HOUSTON, Aug. 22 -- Texas electricity suppliers called for an overhaul after a consultant in charge of testing computer systems associated with startup of the troubled retail electricity pilot resigned.

Since the consultant's resignation, suppliers have asked the Public Utility Commission to make changes in how the testing program is administered and asked for an accounting of the program's expenses and future needs.

Computer problems have dogged the retail pilot, first set to begin June 1, from the start, and thrown it far behind schedule. Full competition is supposed to begin Jan. 1. The consultant was overseeing computer links among the competitive retailers, transmission and distribution utilities, the power scheduling entities, and the Electric Reliability Council of Texas Inc.

ERCOT also has had problems with its internal systems that switch customers to alternative electric suppliers from incumbent utilities.

Almost $1 million was collected from market participants for system testing. Retailers and transmission and distribution utilities were assessed $75,000 each to participate in the market. Electricity schedulers were assessed $10,000 each, according to one market participant.

With 6 retailers, 4 utilities, and 20 schedulers participating in the pilot an estimated $950,000 was collected to pay for tests. ERCOT declined to publicly disclose the figure because of concerns about a confidentiality agreement with the vendor.

Retailer First Choice Power Inc., a unit of TNP Enterprises Inc., Fort Worth, asked for a full explanation of past expenses and how much more, if any, will be assessed to finish system testing before the market opens January 2002.

First Choice and other retailers also urged the commission to hire a new independent administrator who reports to state regulators not ERCOT. The grid operator submitted its own proposal, asking that the systems test administrator report to ERCOT.

In other deregulated markets, the systems test administrator has been independent and reported to state regulators, First Choice Power said. ERCOT shouldn't be allowed to monitor itself, it said.

Whether a new third party administrator is hired or whether ERCOT takes on the task itself, is a matter that will have to be approved by the grid operator's board of directors, said Sam Jones, ERCOT's chief operating officer.

If an independent administrator reporting to the commission is not hired, First Choice recommended any unspent funds be refunded to market participants. First Choice asked for a general review of the costs associated with the independent third party test administrator, including:

-- Reconciliation of all expenditures to date.

-- Projection of anticipated expenditures going forward.

-- Verification that all parties in the tests have contributed their share of fees.

-- Analysis of anticipated final costs to quantify any refunds due market participants.

So far, 106,951 customers have signed up to participate in the pilot program but only a few hundred customers are actually receiving power from their new providers. During testing of the switching process so many errors were generated that Shell Energy Services, a unit of Shell Oil Co., Houston, asked for assurances the systems will fixed before ERCOT proceeds for fear errors could become "unmanageable."

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