Texas narrowly avoids rolling blackouts after 2nd conservation plea by ERCOT this week

Source: By Robert Walton, Utility Dive • Posted: Thursday, July 14, 2022

Dive Brief:

  • The grid operator for most of Texas asked customers on Wednesday to reduce electricity consumption for the second time in a week, citing lower wind and fossil fuel generation than anticipated, and spiking demand amid a sweltering heat wave.
  • Ultimately, the Electric Reliability Council of Texas said it was able to maintain grid reliability and did not ask utilities to curtail demand, though there were conflicting reports in the media and some customers did lose power.
  • ERCOT asked customers to reduce electricity consumption from 2-9 p.m., something it does when the operator expects projected reserves to fall below 2,300 MW for 30 minutes or more. A similar call for conservation was sent Sunday.

Dive Insight:

Electricity prices in ERCOT spiked to $5,000/MWh Wednesday afternoon, as wind output fell and fossil fuel outages increased.

Gas and coal outages at 5 p.m. yesterday were 60% greater than ERCOT had anticipated in its summer Seasonal Assessment of Resource Adequacy, or SARA, energy analyst and Stoic Energy President Doug Lewin noted in a tweet.

The thermal outages are “definitely a big issue,” GridLab Executive Director Ric O’Connell said in an email. “It shows that the thermal fleet is not as reliable as people would have you think. … Renewables are meeting the forecast and are well within the boundaries of ERCOT’s SARA.”

ERCOT was anticipating peak demand of almost 79 GW and forecasts appeared to show lower supplies, but ultimately the grid operator maintained reliability with a margin of about 1.15 GW, according to a privately-maintained dashboard of Texas grid data.

This graph shows the supply-demand balance on the Texas grid.

Conditions were similar to Monday, ERCOT said in its conservation request, when residents and businesses cut demand by about 500 MW to maintain reliability.

Amid the calls to reduce electricity consumption, there were conflicting reports of outages on Wednesday.

American Electric Power said about 3,000 customers lost power in its territory, but it worked with ERCOT to reduce congestion and the local outage was resolved in less than an hour. According to local media, Kenedy, San Patricio and Bee counties all reported outages. Near Dallas, the city of Farmersville said it was conducting blackouts at ERCOT’s request but later retracted that statement.

“ERCOT did not request rolling blackouts,” the grid operator said in a statement. “When ERCOT asks for conservation, we hope all businesses will heed our request, including miners, however there are no requirements for them to conserve.”

Texas regulators have been working on wholesale market changes to improve system reliability, and have directed ERCOT to operate in a more “conservative” manner.

“We’ve built a bigger margin of safety into our current operating posture. We’re buying more reserves, and adjusting the amount of reserves we have at any given time to real-time conditions,” Public Utilities Commission Chairman Peter Lake told the state’s legislature in June.

Those changes mean higher prices for consumers and could add $1.5 billion to electricity bills this year, ERCOT Independent Market Monitor Director Carrie Bivens has estimated.