As wind steals their electricity market, natural-gas firms want it to pay when it doesn't deliver

Texas produces more energy from wind than any other state, but a growing feud between wind and natural-gas interests in the state is reflecting an emerging national trend. Wind power is exempt from state regulations that force utilities to pay for energy that a source fails to deliver. Gas companies say that's not fair, Russell Gold of The Wall Street Journal reports, but wind utilities say they can't control the weather and should not be held accountable for windless periods.

The fight has taken an added sense of urgency as increased wind-energy production in Texas is displacing gas consumption to generate electricity, projected to drop 18.5 percent by 2013, Gold writes. The Electric Reliability Council of Texas forecasts the amount of electricity Texans will need the next day, and orders generation for that power starting with the cheapest source, which is usually wind. Older natural gas plants are generally the most expensive source and are the last sources ERCOT turns to, Gold reports. Fossil-fuel companies that don't deliver the supply of electricity they promised face daily financial penalties, but wind is exempt because of its unpredictable nature.

"My philosophy is that whoever causes the problem should be responsible for fixing the problem," says Kevin Howell, president of Texas operations for NRG Energy Inc., the state's second-largest power provider. "Wind shouldn't cause problems that other people have to fix." Wind advocates argue argue while new forecasting techniques make it easier to predict in advance when wind could provide power, they can't control nature, Gold writes. The battle isn't just contained to Texas; fossil-fuel companies in the Midwest and Wyoming are pushing for wind to be held to similar standards they face. (Read more)