Process is Killing Texas Data Center Projects

As the data center buildout in Texas accelerates, the public conversation has fixated on generation, interconnection queues, and gigawatts. But the firms actually structuring these deals see a different problem entirely: process. In this episode, Joshua Rhodes speaks with Maura Yates, chief executive of Mothership Energy. Mothership is one of the most active retail electricity providers in ERCOT’s large-load market, managing more than three gigawatts of large load and writing more than 39 distinct data center contract templates to handle the variation across deals. Yates says the technology to power data centers exists. The bottleneck for data center completion is the time it takes to sign contracts for electricity service and the time it takes to connect them to the grid. As Texas debates SB6 implementation, co-location rules, and demand-side management, that distinction is shaping which projects get built and when. Joshua and Maura discuss topics including: * Why Mothership has written more than 39 distinct data center contract templates. * The difference between behind-the-meter, front-of-meter, and co-location deals. * What the Crusoe Goodnight data center PUC ruling means for future co-location projects. * Why most data centers are data center companies, not power companies. * HowYates expects ERCOT to integrate large load without pushing costs onto residential customers. Energy Capital Podcast is produced by ClarityForge Studios. Timestamps * 00:00 - Introduction & Maura Yates * 01:26 - Building Mothership from Both Sides of the Market * 03:27 - The Problem Mothership Was Created to Solve * 05:51 - White Label REP Model and Getting DERs into ERCOT * 08:37 - Option One vs. Option Two Retail Licenses * 10:42 - Selling the Residential Book and Pivoting to Large Loads * 13:27 - Entering the Data Center and Bitcoin Mining Space * 16:24 - How Mothership Structures Data Center Deals * 19:13 - What the Market Needs: Process Over Technology * 21:24 - Co-location, Net Metering, and BYOG in ERCOT * 26:13 - Do Data Centers Actually Want to Be Power Companies * 28:12 - Eclipse: Mothership’s Market Access Platform * 32:01 - Forward Curves and Empowering Price Takers * 38:07 - The Grid’s Future: Distributed Supply and Data Center Growth * 41:03 - Closing Resources People & Organizations * Maura Yates (LinkedIn) * Mothership Energy (Website - LinkedIn) * Joshua Rhodes (LinkedIn) * Webber Energy Group (Website - LinkedIn) * IdeaSmiths (Website - LinkedIn) Company & Industry News * Mothership Energy and Atlantic Energy Complete Texas Customer Transfer Related Podcasts by Energy Capital * “The Name of the Game is Flexibility,” a Conversation with ERCOT’s Pablo Vegas Transcript Joshua Rhodes: Hi, everyone, and welcome to the Energy Capital podcast. I’m really excited to have Maura Yates here to talk about Mothership Energy in ERCOT. Maura Yates has over 20 years of experience in the power industry, starting in distributed energy resources at Arizona Public Service before moving to governmental affairs at Sun Edison and then becoming VP of sustainability at MP2 Energy, which was bought by Shell in 2017. In 2021, Maura co-founded and is the CEO of Mothership Energy Innovations with her business partner, Caitlin Brammer. Mothership is the 18th largest retail electricity provider in the nation and is contracted and manages over three gigawatts of large loads in ERCOT. In addition to being a rep, Mothership provides risk management, technology and consulting services to electric cooperatives in Texas and specializes in data center and wholesale procurement. Yates, welcome to the Energy Capital Podcast. Maura Yates: Thanks for having me. Super excited to be here chatting with you all. Joshua Rhodes: Yeah, and we’re again, super excited to have you. Before we dig into mothership and your current role, like looking back kind of where you’ve come from, your LinkedIn started in a regulated electricity space at Arizona Public Service before kind of going into more corporate with Sun Edison and MP2 and Shell. And now you’re CEO of like a company in the really competitive space. How were those different, those roles that you have in the different spaces where they Maura Yates: That’s a really good question and it’s one I enjoy answering because ultimately it’s that background that has allowed us to create incubator Mothership Innovations to be the shop that it is. So when you look at the places, I’ve spent time at the utilities, I spent time at the development side, both a DER and large scale solar development shop, all the way then to a deregulated pseudo rep slash utility in ERCOT. And really just bounce back and forth from utility side. To developer or industry side, back to a version of the utility, back to the industry side. And now I’m back on quote unquote the utility side or the delivery side and supply side. And where we’ve landed with Mothership is really taking the learnings of participating and being a part of a company on both sides of the transactions, right? So you typically have the utility on one side and the developer on the other side. And so by jockeying back and forth between these spaces, between our regulated utility all the way into the deregulated market, it’s given us a really well-rounded understanding of how these different parties participate in the market, but also really what they find important and what they find valuable and like, what is it that the utility is trying to get out of transactions? What is it the developer is trying to get out of transaction? And when you better understand both sides of a transaction, you’re able to come up with a better solution for the transaction. Which is why, again, we’ve developed mothership in its latest stage to really be this deal shop and this service provider for both developers and other load serving entities and utility providers. And I should clarify, I’m using utility and like not the traditional ERCOT sense of TND, but really the one providing and servicing power to the end user. Joshua Rhodes: Yeah, no, that makes sense. Like, can you kind of tease out a little bit like of that? I seeing both sides of kind of how things operate is super valuable. So as you were seeing both sides, can you kind of tease out what was the problem that mothership was originally created to solve? Talked about both sides, but what was that problem there? Maura Yates: Yep. So the more time that we spent on both sides of these deals. So for example, I go back all the way to Arizona Public Service when we structured some of the first utility incentive programs and we were very aggressive, like in a very solar friendly way in terms of the incentives we were offering. So we worked really closely with the industry and the solar and battery developers. And our goal there was to better understand what is it that gets you to transact, right? Like if our goal as the utility was to get solar adopted by homeowners, what is it that the solar homeowners need to adopt? And what is it we as the utility then need to provide to enable this transaction? And we did a good job. Typically the utility or the load serving entities role is to provide some form of incentives and compensation. And we did that and we had success. We deployed a lot of projects, but incentives aren’t the most sustainable mechanism for growing an industry. So you have to continue to find value and way to extract value as you move away from incentives as the technologies become more competitive. When you start moving down the advancement and the maturity continuum, you start to realize that the challenge in getting these technologies deployed from both sides is really the customer experience. Something has to change in the customer experience. Everybody talks about it, both utility talked about the customer experience and the developer talked about the customer experience. But they talked about it differently and it’s the same customer. So our point was this customer is facing a very bifurcated customer experience. They would get a bill from their solar develop… This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.texasenergyandpower.com/subscribe