Welcome to Grid Brief! Here’s what we’re looking at today: Texas considers keeping an old gas plant online, the US Treasury limbers up some clean energy tax credit requirements, the global LNG import boom, and more.

ERCOT Ponders RMR for Aging Gas Plant

The Electric Reliability Council of Texas is considering offering a Reliability Must Run agreement to Talen’s Barney Davis gas unit as the company signals its readiness to retire it.

“The Barney Davis plant is located in Corpus Christie, Texas, and according to generator registration documents has a total of 925 MW of capacity,” reports Utility Dive. “Of that, 292 MW comes from a gas-fired steam unit in the territory of AEP Texas Central. According to ERCOT, the unit intends to ‘indefinitely suspend operations’ as of Nov. 24.”

“The reliability analysis does not show that there would necessarily be local reliability issues if this unit were to retire,” ERCOT President and CEO Pablo Vegas said last week. But ERCOT, Vegas added, is focused on making sure it has the capacity to make it through winter.

If ERCOT decides the unit is needed for reliability, it will move to offer an RMR agreement in October. RMRs are not meant to “address long-term system needs,” according to ERCOT. They enable plant proprietors to recuperate expenses, and since the evaluations are rooted in system-wide reliability, the "costs to run RMR units are shared by all market participants."

Treasury Ups Flexibility for Green Tax Credits

The US Treasury Department has outlined new guidelines for apprenticeships and wage mandates for green projects that want to receive clean energy tax credits.

“The newly proposed IRS rules detail additional for constructing clean energy production and manufacturing facilities and build on rules already laid out by the IRA of last year,” reports Oilprice.com.

According to the new rules, following the prevailing wage as required by the Labor Department regulations and employing skilled apprentices will allow companies building IRA-qualified energy production facilities to gain tax credits amounting to five times the baseline value.

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Three Countries Began Importing LNG This Year

Three countries—Germany, the Philippines, and Vietnam—began importing LNG this year. They mark a new wave of LNG import capacity across the globe.

“Global liquefied natural gas (LNG) import capacity is set to expand by 16%, or 23 billion cubic feet per day (Bcf/d), by the end of 2024 compared with 2022,” reports the Energy Information Administration.

The EIA expects Antigua, Australia, Cyprus, and Nicaragua to start importing the super-chilled fuel; a host of other countries are already in the final stages of developing their LNG import capacity.

Conversation Starters

• Offshore wind leases in the Gulf of Mexico drew few bidders. “The Department of the Interior’s Tuesday auction of three lease areas in the Gulf of Mexico only netted bids on the area offshore Lake Charles, Louisiana, while the two areas offshore Galveston, Texas did not receive bids,” reports Utility Dive. “RWE Offshore US Gulf put in a winning bid of $5.6 million for the 102,480-acre Lake Charles lease, which has the potential to generate up to 1.24 GW, according to Interior. Research firm ClearView Energy Partners said in a Tuesday note that a lack of offshore wind targets in the Gulf states, as well as technical difficulties posed by deployment in those waters, may have contributed to a lack of bidder enthusiasm.”

• Toyota ran into a major glitch. “Toyota Motor Corp. said it will gradually resume operations at its 14 domestic plants Wednesday after a system malfunction suspended production, a rare glitch for the world’s biggest carmaker as it rushes to reboot its famed production system,” reports Bloomberg. “The malfunction had made it impossible to order parts, a Toyota spokesperson said, affecting some 28 assembly lines churning out everything from the top-selling Corolla and Camry to Prius hybrids. The company doesn’t suspect it’s the victim of a cyberattack, the spokesperson said.”

• Poland hangs onto its coal exit plan. “Poland is not planning a quicker end to using coal, the government said on Wednesday, criticising state-controlled utility PGE for bringing forward its carbon neutrality target by a decade to 2040. Under a pact the government signed with trade unions, Poland plans to keep mining coal until 2049,” reports Reuters. “PGE, Poland's biggest power utility, said on Tuesday it is seeking a faster exit as it bets on renewable energy. While coal generates some 70% of Poland's electricity, experts say using the fuel in power generation is not sustainable in the long run amid rising costs and the European Union's green climate policies.”

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