Denton staff recommends refinery of renewable goal, retirement of RECs and launch of 20-year integrated resource plan

Denton Municipal Electric (DME) staff on May 19 told the City of Denton Public Utility Board (PUB) that it will recommend clarifying how the city measures its 100% renewable goal, adopt a policy to retire renewable energy credits (RECs) once counted, and begin a long-term integrated resource plan (IRP) to determine the utility’s future generation mix.

Tony Puente, DME general manager, said the presentation defined gaps in the 2018 renewable plan and summarized findings from an internal audit and market developments. "Part of our recommendation will be, that once we count a REC towards that 100% renewable goal, that we retire it," Puente told the board.

Why it matters: staff framed the proposed changes as measures to maintain a transparent, auditable accounting method for the renewable target while managing reliability and cost risks tied to intermittent resources such as wind and solar. The IRP would analyze dispatchable and non-dispatchable options, forecast long-term load and reserve needs, and recommend procurement or build strategies.

Key staff recommendations and clarifications presented to the PUB: - Define the city renewable-energy goal in policy and formalize annual reporting and accounting methods (staff estimated 6–9 months for the policy). Puente said staff will count only RECs generated in the same calendar year they are applied to the goal. - Retire RECs used to meet the 100% goal rather than monetizing them; sell only truly excess RECs to benefit ratepayers. - Begin a 20-year integrated resource plan (IRP) with an 18–24 month timeline and community/stakeholder engagement; staff recommended hiring an external firm to support the process. - Take a cautious approach to large-load contracts (data centers and other 24/7 customers), preferring shorter-term or conditional arrangements rather than locking into long 15–20-year power purchase agreements for speculative loads.

Puente outlined current resources and challenges: DME has one dispatchable resource at 150 megawatts and about 455 megawatts of solar under contract, a PPA (Whitetail) that previously supplied REX that has since expired, and an RFP under evaluation for up to 300 megawatts of solar, wind and battery. He also noted that one solar project, Yellow Viking, is not yet online.

Staff cited recent figures and risks: summer 2023 peak native load was 408 megawatts; the city’s quick-start generation (the “deck”) provides roughly 225 megawatts, leaving an approximate shortfall of 183 megawatts to be served by other resources or contracts. Puente said that over the next two decades the city could need several hundred megawatts of additional dispatchable generation under current growth forecasts; staff used a 20-year planning horizon in the IRP recommendation.

Board reaction: members pressed staff on the balance between buying RECs and procuring physical renewable generation. "We need to separate the goal from the implementation," said Mister Taylor, PUB member, urging public engagement during policy development. Mr. Chan said he supported public meetings and recommended early stakeholder outreach during the policy phase. Several members emphasized reliability concerns and the economics of long-term PPAs.

Next steps: Puente asked for the PUB’s recommendation to send the presentation to City Council; staff will bring the renewable-energy policy forward internally over the next 6–9 months and proceed with an IRP that includes public engagement and a recommended vendor. Puente said staff plans to present the same package to council on June 3 for direction.