When the state electrical grid operator warned Thursday that Texas could be hit with blackouts next summer in part because its cushion of reserve energy is less than hoped, reaction was swift, but all over the map.

“I worry that if there isn't more of an emphasis on sounding the alarm, it won't get fixed,” said Diane Liebmann, an attorney with Haynes Boone in San Antonio who has represented power companies before the state's various energy regulatory agencies.

Others are more skeptical of claims that Texas won't have enough power to keep the lights on, including Clarence Johnson, a veteran energy consultant and former director with the Texas Office of Public Utility Counsel, which represents consumers.

The experience thus far, he said, is that new power plants have been built in time to meet increasing demand.

“Generation has always shown up,” he said. “There is no reason to believe it won't.”

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At issue are the incentives — or perceived lack of them — for power companies to build new plants to meet demand in this fast-growing state. While many are planned, it's unclear how many actually will get built.

Some worry the “energy only” market in Texas, which pays plant operators only for the power they supply, doesn't offer companies enough of a return to reliably recoup the multibillion-dollar cost of building a new power plant.

Every other energy market in the world, save Australia, operates a “capacity market,” that pays generators a flat amount on top of the cost of the power, ensuring the necessary incentive to build new plants.

Generators like the guaranteed additional payments under that system, but they are passed along to consumers, raising energy prices.

When Texas deregulated its energy market a decade ago, it had plenty of excess capacity, and so chose to create an energy-only market. Since then, however, reserve margins have continued to shrink.

In Texas and Australia, regulators have set price caps on what a generator can charge for wholesale power during periods of peak demand, but Australia's is five times higher than the Lone Star State's. Those occasionally sky-high prices create enough of an incentive for companies to build, Liebmann said.

“There's no stomach in Texas” for raising price caps to Australian levels, she said, nor is the Public Utility Commission of Texas, which regulates the industry, interested in creating a capacity market.

The commission is concerned, however, that prices may not be high enough to incentivize new power plant construction, and is looking for less drastic ways to tweak the system.

“The commission would like to have as gentle a touch on the market as possible,” PUC spokesman Terry Hadley said.

He said commissioners are in consensus that a capacity market would force higher costs onto customers and potentially create more capacity than is necessary.

The PUC recently approved higher minimum prices for wholesale power, and is looking at possibly raising the current price cap of $3,000 per megawatt hour, among other potential changes to the system.

It works differently for municipally owned utilities, such as CPS Energy and Austin Energy. They build and plan for the demand in their own markets, and recoup costs through rate increases.

But they're not immune to the rolling blackouts that would come with statewide power shortages, so CPS has been participating in the discussion about what to do.

In a recent memo to his fellow PUC commissioners, Ken Anderson, who has expressed interest in increasing the wholesale price cap, noted that CPS suggested raising it to $4,000 per megawatt hour.

Johnson thinks the PUC should proceed with caution.

He noted that ERCOT historically has forecast lower reserve margins in outlining years than the grid actually ends up with — not because it's doing anything wrong, but because it is notoriously difficult to estimate when and how much new capacity will be built in any given year.

Reserve margins aren't intended to guarantee that there's never a blackout, he said, but to provide a cushion to meet the range of the most expected weather outcomes.

“It's really premature to say we're headed for a calamity,” he said.