Monday Musings #60: ERCOT, CPS Energy & AEP Texas Should Hit “Pause” on Howard-Solstice Transmission Line

For the second time this month, the ​bigcitysmalltown​ podcast and this newsletter are putting a spotlight on two multi-billion-dollar, publicly funded infrastructure plans that would inflict irreversible environmental damage and a loss in land values in the Big Bend, Hill Country and Canyonland regions of the state.

Both projects should be slowed or halted. Click ​here​ to access our earlier podcast on the Trump administration’s proposed $46.5 billion Big Bend wall, a project that aims to address an immigration problem that simply does not exist across the vast, mountainous Chihuahuan Desert. Click ​here​ to read our newsletter on the same subject.

Our latest podcast episode focuses on the $1.4-2.1 billion, 370-mile-long ​Howard-Solstice Transmission Line​ that ​CPS Energy​ and ​AEP Texas​ propose to build and operate to deliver power from Bexar County to Fort Stockton where it can support operations in the Permian Basin oilfield. The project is one of 24 energy transmission projects requiring eight new “import paths” crisscrossing the state in the Electric Reliability Council of Texas’ 15-year, $33 billion ​Permian Basin Reliability Plan​.

HB 5066 was approved by Texas legislators and signed into law by Gov. Greg Abbott in 2023. Rep. Charlie Geren (R–Fort Worth) was the original author of HB 5066, which charged the Public Utility Commission of Texas and ERCOT with devising plans to generate and transmit more energy to support oil and gas production in the state.

Many San Antonio metro area ratepayers will be surprised to learn that this massive, top-down, statewide project tasked CPS Energy and AEP Texas to develop the transmission line long distance to West Texas, with the costs ultimately falling to ERCOT-member utilities and on to their ratepayers, including CPS Energy customers. The original proposal resembled paint thrown indiscriminately against a blank canvas with 77 different proposed routes drawn on state maps that challenged landowners and others to decipher and then battle.

“The map looked like a giant spider web, one pitting landowner against landowner,” said ​Ted Flato​, whose family owns a Kinney County ranch that holds the headwaters of the West Nueces River and is close to the Devil’s River watershed. Flato, a founding principal of Lake|Flato Architects in San Antonio, is also a founder of the nonprofit Headwaters Alliance, a coalition of landowners that advocates for Hill Country and Edwards Plateau land and water preservation and conservation.

While a CPS Energy representative said creation of the transmission line does not represent an expansion of the municipal utility's service area, it certainly seems to, even if retail electricity delivery is not being offered to ratepayers in the Fort Stockton region.

The plan to transmit power from Bexar County to far West Texas will require AEP Texas and CPS Energy to navigate some of the state’s most pristine and sensitive river basins and canyonlands. Now, several legislators in both parties who voted for the legislation in 2023 are expressing misgivings after hearing from voters who will be negatively impacted by the project.

Tens of thousands of Texans have registered their opposition to the project in advance of the PUC’s final route decision that will be made in August if the project proceeds as planned. Flato and others who oppose any transmission lines running through the region’s river basins and canyonlands give CPS Energy’s leadership credit for working to minimize the impact with proposed route modifications. The utility’s modifications, however, remain subject to PUC approval. The utility could pick a less expensive, more direct route, even knowing of the environmental damage such a decision would cause.

Even with CPS Energy’s route modifications, there is simply no way to get from the Howard Road substation in southwest Bexar County out to West Texas without carving a 200-foot wide path the entire 370-mile route, and building adjacent service roads for trucks, bulldozers and other heavy equipment through private property.

The line, with its 140-180-foot towers – the taller ones the same approximate height as the One Riverwalk Tower in downtown San Antonio – would forever alter viewsheds for neighboring landowners who would see the value of their properties plummet while receiving no compensation from the state. Another major challenge is convincing the PUC to approve a longer, more expensive route that avoids crossing the sensitive Edwards Aquifer Recharge Zone in multiple counties. San Antonio taxpayers have invested $400 million in recent decades to protect property over the recharge zone from being developed.

Here’s the challenge: The Permian Basin is the nation’s leading oil and gas field. Yet power generation in the region is wholly inadequate to serve the industry. Water is even more scarce. So ERCOT wants utilities based elsewhere in the state to start delivering resources to the oilfields with little regard to the collateral damage current plans would cause.

At the same time, datacenter builders see Texas as Ground Zero for the sector’s unprecedented building spree planned in the next few years. Cheap land in West Texas and the possibility of new power lines serving the region have placed West Texas on the expansion map. What’s next? The state mandating a SAWS water pipeline to the region?

How many of our thousands of newsletter readers even know that CPS Energy plans to generate and transmit power to far West Texas? Landowners along the route have complained of receiving letters in the mail last summer detailing a hurried, 2026 timeline for receiving their input and the PUC’s final decision. There have been a few regional public hearings, but the ERCOT plan and the role CPS Energy is tasked in executing have received scant attention at San Antonio City Council, which must approve CPS Energy rates and budgets. I doubt anyone can accurately predict the impact ERCOT’s plans will have on ratepayers, but the far-reaching scope of the plan merits more public input.

Hill Country and Southwest Texas landowners, conservative groups and environmental organizations have expressed opposition to the project. ​Preserve the Hill Country Coalition​ has registered 48,000 opponents in filings to the PUC. An ​article published in March​ by the Texas Tribune suggested that opposition might stop the project. I have my doubts.

CPS Energy CEO ​Rudy Garza​ appeared on the bigcitysmalltown podcast earlier this year. We covered a lot of ground, including the project and the surge of artificial intelligence-related datacenters flooding into the state and the San Antonio metro area. I didn’t have a full appreciation of the ERCOT-directed project at the time.

I do now, and have more questions than answers. One question for ERCOT: How come long-term plans do not include connecting to other multi-state grids? All sides agree there is a pressing need to strengthen our grid and meet rising energy demand in the country’s fastest growing state where climate change and extreme weather events that threaten grid capacity are becoming more common.

A related question: Did ERCOT consider recruiting El Paso, which is 100 miles closer than San Antonio to the Permian Basin, to be the host of a new transmission line serving the Permian Basin? PUC officials would argue that relying on the closer city would require new grid connections and construction of a new power plant, both of which seem to make sense, but would interfere with their hurry-up timetable. There certainly is abundant natural gas in the region to fuel such a new plant.

El Paso Electric is not part of ERCOT. The investor-owned utility operates in West Texas and New Mexico as a member of the ​Western Interconnection​, an international grid that extends from northern Mexico through 14 states into Canada. It was engineered to sustain sub-freezing temperatures common in Western state winters. It seems like a power line running along Interstate 10 West from Fort Stockton would be a much simpler, and thus a less expensive option with fewer engineering challenges.

There very well could be barriers I'm unaware of in considering alternatives. That’s the problem: A purposeful, community-driven information and education program has never been contemplated, much less vigorously pursued. Instead, state leaders are racing ahead without understanding the unintended consequences that could result from one of the most consequential projects ever taken on by CPS Energy.

My regular readers know two things about my approach to energy generation: One, I am pro-growth and pro-development and I know we have to generate and sell more energy to grow the economy and create more jobs. Two, I have long admired CPS Energy, the country’s largest municipal energy provider. I know how much better it serves ratepayers than any for-profit merchant utility would do.

That said, this project does not meet the standards any of us expect from our leaders. The enabling legislation was driven by legislators who have no stake in CPS Energy or the Texas Hill Country or the canyonlands southwest of San Antonio. This project ought to be slowed or stopped.