Texas power market monitor resigns amid unresolved reform debate

HOUSTON, March 3 Mon Mar 3, 2014 7:56pm EST

HOUSTON, March 3 (Reuters) - Dan L. Jones, a vice president of Potomac Economics which serves as the independent market monitor for the $35 billion Texas power market, submitted his resignation Monday, a spokesman for the Texas Public Utility Commission (PUC) confirmed.

Jones has been active at the PUC in the ongoing debate about the need for reform of the Texas power market where demand is growing faster than supply.

Jones will leave his position as director of the independent market monitor for the Electric Reliability Council of Texas (ERCOT) no later than March 17, said Terry Hadley, a PUC spokesman said.

In a note to the three-member commission, Jones said his resignation "is the right decision for me and my family at this point in our lives and in my career," according to Hadley.

"Dan set a very high standard in monitoring the ERCOT market," Hadley said.

Jones served as director of the ERCOT wholesale market since 2006 and led a staff at Potomac which will continue in the market monitor role, said Hadley.

Jones declined to give further comment on the reasons for his resignation.

He and other Potomac officials have generally supported creation of a capacity market as a way to increase revenue for power-plant owners and newcomers looking to invest in the Texas market.

Potomac's analysis of the Texas power market put the spotlight on falling wholesale prices that make it difficult for generating companies to be profitable under existing market rules.

The PUC, legislators, large industrial users and other market participants are now divided over how to address the slowdown in new power-plant investment and the issue is likely to remain unresolved until the Texas Legislature meets next year.

Jones was a policy analyst at the PUC from 1994 to 1999 and served as a commissioner's adviser.

Separately on Monday, ERCOT extended its call for residents and businesses to conserve power as a late winter cold front boosted power consumption to a monthly record, straining available generation.

Power producers in Texas include Luminant, a unit of privately held Energy Future Holdings, NRG Energy , Calpine Corp, NextEra Energy, Exelon Corp, LS Power and Panda Power Partners.

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