Austin Energy’s power generation hit the 65 percent carbon-free level in 2024, and the municipal utility is targeting 100 percent carbon-free load by 2035, one of the most aggressive clean energy targets of any utility in Texas. Austin Energy is one of the largest municipally owned utilities in the country and one of the few vertically integrated utilities operating inside ERCOT’s deregulated market. As the utility plans for load growth and rising ERCOT market exposure, it is also preparing the community to weigh the trade-offs that entails. In this episode, Joshua Rhodes speaks with Stuart Reilly, general manager of Austin Energy, and Lisa Martin, the utility’s chief operating officer. Reilly and Martin walk through how the muni model shapes new load evaluation, renewable contract structure, and community engagement. They describe a resource plan that combines local generation with utility-scale batteries, distributed energy deals, transmission upgrades, and demand response. Joshua, Stuart, and Lisa discuss topics including: * What it means to operate as a vertically integrated muni inside ERCOT’s competitive market. * The 500 megawatts of plausible new load Austin Energy is planning for, and why most of it is not data centers. * How load zone price separation has changed the hedging value of distant renewable power purchase agreements. * Why the resource plan calls for new local generation alongside more clean energy procurement. * A new 100 MW battery deal with Jupiter Power and a 40 MW distributed deal with Base Power. * How the utility returned over $100 million to customers from Winter Storm Uri. * How Austin Energy communicates reliability, affordability, and clean energy trade-offs with its community. Energy Capital Podcast is produced by ClarityForge Studios. Timestamps * 00:00 - Intro, Stuart Reilly and Lisa Martin * 01:11 - Austin Energy as a Non-Opt-In Utility * 05:47 - Planning for Load Growth, Why Gas Peakers * 09:25 - Sizing Real Load vs the ERCOT Forecast * 10:49 - New Loads, New Costs, Who Pays * 12:13 - Load Zone Separation, Explained * 14:02 - Decker Retirements and Local Generation * 16:51 - PPAs, Hedges, and the $850 Problem * 18:26 - How a Gas Peaker Fits a Carbon-Free Goal * 23:53 - Why Local Power Enables More Renewables * 26:43 - Communicating Complexity to Customers * 31:19 - Jupiter Power, Base Power, and Local Storage * 36:08 - Distributed Batteries and Distribution Costs * 40:25 - Closing Thanks and Outro Resources People & Organizations * Joshua Rhodes (LinkedIn) * Webber Energy Group (Website - LinkedIn) * IdeaSmiths (Website - LinkedIn) * Stuart Reilly (LinkedIn) * Lisa Martin (LinkedIn) * Austin Energy (Website - Executive Leadership Team) * Other Oganizations Mentioned * ERCOT (Website) * Jupiter Power (Website) * Base Power (Website) Company & Industry News * Austin Energy signs Battery Storage Deal, Advancing Climate and Reliability Goals * Austin expands renewable energy push with major solar generation investments - Community Impact * Texas grid operator’s demand forecast likely an overestimate - Texas Tribune * Austin Energy 2035 plan sees challenges and successes one year after adoption - KXAN Books, Articles & Reports Discussed * Austin Energy Resource, Generation and Climate Protection Plan to 2035 * ERCOT Preliminary Long-Term Load Forecast 2026–2032 * Aggregate Distributed Energy Resource (ADER) Pilot Project Related Podcasts by Energy Capital * All Energy Capital Podcasts * Texas Growth Is Running Into Power Grid Limits with Katie Coleman * Who Pays for the New Grid with Pablo Vegas * Creating a Distributed Battery Network with Zach Dell Related Posts by Texas Energy & Power * Process is Killing Texas Data Center Projects * Transmission Takes a Decade, Load Doesn’t — with Raina Hornaday Transcript Joshua Rhodes: Hey everyone, welcome to another edition of the Energy Capital Podcast. I’ve got not one but two guests for you today, both from the C-suite of Austin Energy, one of the largest municipal utilities in the country. It actually ranks as the eighth largest publicly owned electric utility in the U.S. And it serves about a million folks in the greater city of Austin. So today we’re going to be talking to Stuart Reilly, who’s a current general manager of Austin Energy. Stuart has spent about 20 years in service of the city of Austin, starting as assistant city attorney, before moving up to various roles at Austin Energy. Lisa Martin is currently the Chief Operating Officer at Austin Energy, but she’s also spent times before at SoCal Edison, going through energy supplies and contracts and other types of things. And also from her LinkedIn, found out that she had something to do with subsea surveillance at Shell, which I actually want to just throw out all of the questions I have for you guys and focus just in on that. So sorry, Stuart, if we don’t talk about anything that we were going to talk about, but having found this out today. I’m really excited to have both of you all here to talk about Austin Energy. So Stuart and Lisa, welcome to Energy Capital Podcast. Stuart Reilly: Thanks Josh. Lisa Martin: Thank you, glad to be here. Joshua Rhodes: So in this podcast, we talk a lot about energy. We talk a lot about Texas energy. And a lot of times when we’re talking about ERCOT, we’re talking about the competitive regions of the system. And most electricity meters in the state of Texas are in kind of the power to choose region. But there are some parts of the states that are different, one being Austin Energy, the other being the City Public Service of San Antonio. And a lot of the co-ops are actually these things called non-optin entities. Stuart, can you explain kind of what those are and kind of how Austin Energy fits in the energy mix in ERCOT and in Texas. Stuart Reilly: Yeah, absolutely. And Austin Energy has been around since 1895. Like you mentioned, we serve about a million residents, 580,000 customer accounts, homes and businesses. Not just in the city of Austin, but kind of in the Travis County region, we serve 11 other cities in our area and unincorporated areas of Travis County. Currently the third largest municipally owned utility, but operating in the ERCOT market as a non-optin entity. So because our history kind of goes back to this 1895 period when investor owned utilities didn’t want to come to Austin, our city decided to start this journey on its own, build a dam, build a powerhouse that served as the first street lighting system, the moonlight towers that we still have here in Austin. Even as the market evolved and even after the competitive market in Texas and ERCOT came to be, we still operate as vertically integrated utilities. So we still have generation, transmission, distribution, and retail customers. And we do all of the customer service functions for the city of Austin. And so while we’re a vertically integrated utility in Texas, we still have to compete in the ERCOT market. Our generation, we still sell all of our generation into the ERCOT market and we buy all the load to serve our customers out of the ERCOT market at the Austin Energy Load Zone. So even though our generation used to directly serve our customers, now it’s operating and bid into the market just like anybody else is operating in that ERCOT market. So really when you look at us as a vertically integrated utility in Texas operating everything from end to end, I think we have the ability to do more of what’s in our community’s best interest. Because if you’re just operating in the ERCOT market as a generator, your interest is in generating more and that’s where your income is going to come from. For us, it’s really looking at the whole picture of what is the best outcome for the customer leading with our values. We’ve been trying to sell less of the thing that we sell. So if we’re a generator, we’d be generating more. If we were a rep, we’d be trying to sell more. So that’s really enabled us to be ahead of the game when it comes to energy efficiency programs, rebate programs, solar programs, getting our customers to do things on the customer side that get to better environmental outcomes. Because we’ve been talking for years of decades, even in Austin, about how a kilowatt reduced is cheaper than a kilowatt produced. So if you’re looking at getting to cost effective environmentally friendly outcomes, we think we have that kind of advantage by looking at the whole picture by serving customers and operating as a generator in the market. Lisa Martin: And I’ll just add in that I think being municipally owned has really helped us get where we are in terms of being a leader in the energy transition because our public and our city council are so engaged. And so, you know, for right now we’re implementing our resource generation and climate protection plan to 2035. And a lot of it involves going out into the community and talking to them and saying, Hey, what is being a good utility partner look like to you? What do you expect out of your utility? And so we get lots of feedback from the community and our city council, and that all ties into what we’re working on. Joshua Rhodes: That makes sense and I want to dig into quite a bit of that, but Stuart, you actually brought up a really good point about some of the first uses of electricity in Austin being our famous moon towers. I just want to verify these are the same moon towers where the dazed and confused party at the moon tower be there comes from, right? Stuart Reilly: Yeah, and we have a little history center here in Austin Energy that shows some of that. And I think Matthew McConaughey is playing there around the clock telling people that there’s a party at the Moon Tower. I think that that really sparked a new level of understanding and appreciation for our iconic Moonlight Towers, which we still operate after all these years and they’re designated as Tex
