ERCOT Expects Threat to Grid to Lessen

Dave Fehling/StateImpact Texas

Transmission towers in Houston

So far, so good as 100+ degree temperatures blanket much of Texas, stressing the ability of power plants to keep millions of air conditioners running.The manager of the statewide grid, the Electric Reliability Council of Texas (ERCOT), said while the system was stressed with the second day of triple digit temperatures and there was concern there would be problems, none occurred. And some relief may be on the way.

“Tomorrow (Wednesday), the weather forecasts have the temperatures moderating a few degrees and right now were forecasting (peak demand) something between 64,000 and 65,000 (megawatts),” said Kent Saathoff, ERCOT’s vice president for grid operations.

That demand would be below Tuesday’s which Saathoff said they expected to break 66,000 megawatts which would be a new record for June. The old record was set yesterday with 65,047 megawatts.

Saathoff said there are a total of about 400 power plants statewide and that so far, there have been no breakdowns above what normally occurs.

“We don’t have any abnormal amount of outages today. But the more days we have like this we have, particularly if they are strung together, that causes more wear and tear on the plants and there’s more potential for having forced outages,” said Saathoff.

Price Spikes

It’s during these times of huge demand that electricity prices on the wholesale market skyrocket. Earlier in the day, they were at about $26 per megawatt hour. But by mid-afternoon, they soared and hit the regulated price cap of $3,000. But not for long.

“I would say it was probably for several, 15 minute intervals but probably less than an hour,” said Saathoff in a conference call with reporters.

That’s a key issue in what the Texas Public Utility Commission will likely vote on this Thursday. The three commissioners are expected to approve raising the price cap to $4,500 starting August 1. The hike is opposed by some consumer and industry groups that warn that the commission may be moving too fast in its efforts to spur construction of new power plants by making the Texas electricity market more profitable.

An industry group, the Texas Industrial Energy Consumers, estimates the higher price cap would raise the statewide cost of electricity by over $4.5 billion per year.