Texans might not have enough power to keep air conditioners humming without interruption this summer if the forecasts of the organization responsible for maintaining the reliability of the Texas grid are correct. There are two trends leading to the anticipated troubles of the grid. Many older plants will no longer be able to operate as new EPA rules take effect. However, the demand for electricity in Texas is predicted to continue to rise.
ERCOT had a difficult year in 2011, a year that saw around 7,000mw of capacity lost from the grid. Most consumers were probably not aware of the loss in electricity capacity for the grid but they felt the impact as rolling blackouts occurred throughout the state during a frigid winter storm.
ERCOT is taking steps to try to prevent a repeat of February 2011 when the grid was unable to meet demand and was forced to implement targeted blackouts. Working with the PUC they are seeking to update rules to allow for greater participation of contingent electricity sources in the event of an electricity demand emergency.
With power reserve margins dangerously low planning becomes all the more critical. There is simply no wiggle room in the system at this point. To make for better planning and minimize the chance of surprises ERCOT is asking transmission operators to report on all late stage electricity projects to confirm they are on track for their anticipated go-live dates.
The challenges being faced by ERCOT right now are a complex mix of unprecedented weather behavior, economic pressures, and a set of new environmental protection agency rules that will lead to existing power plants being shut down because they will not be compliant with the new rules. Texas over the last year experienced a string of weather events not seen before. Weather challenges faced by the Texas electricity grid started early in the year as February saw an ice storm that effectively shut down transportation and kept Texans in their homes where they turned on their heaters and demanded record electricity output from the grid. The record demand along with weather-related failures at certain key points in the power generation infrastructure forced ERCOT to implement controlled blackouts.
As Texas is dealing with these weather events it is absorbing the impact of new EPA rules. Many market observers have been warning for a while that the EPA rules could mean not just higher electricity rates in Texas but could jeopardize the reliability of Texas electricity. These warnings could become reality as several otherwise operational power plants are closed down because they will not be able to comply with the regulations. The difficulties being felt in Texas are being seen in the whole North American grid system. With hundreds of electricity plants closing down for upgrades mandated by the EPA rules there is a very real concern that blackouts will occur.