According to a report by the Energy Information Administration, wind curtailments in Texas have dropped steadily and substantially since 2011 thanks mostly to the state’s completion of 3,500 miles of transmission lines as part of the Competitive Renewable Energy Zones program. A curtailment refers to and event where a power plant is asked to slow or stop feeding electricity to the grid. This happens when the supply of electricity greatly outweighs the current demand for electricity. When this happens electricity production has to be reduced (curtailed) in order to keep an oversupply of power from causing a disruption of the power grid.
Because electricity rates in Texas are allowed to fluctuate based on real-time market demand, prices for wind generated electricity have in the past sometimes gone negative. This creates the odd circumstance where wind power producers actually pay market participants to accept their electricity. This is only really possible in the world of wind power because federal production credits pay wind producers for every kilowatt of power they produce and sell to the grid; even if they are selling the power for a negative price. Instances of negative pricing have also dropped substantially since the CREZ project was completed.
Texas experienced a boom in wind capacity from 2006-2009 resulting in the production of over 7,000 megawatts of wind capacity. Since most of these wind turbines were built in West Texas and most of the state’s population is in the eastern part of the state, Texas experienced what is known as transmission congestion. There weren’t enough large power lines and transmission equipment to get the power from the western part of the state to where it was needed in places like Dallas/Fort Worth, Waco, and Austin.
In an effort to address this imbalance between the available supply in the west and the demand in the east, the Texas Public Utility Commission in 2008 created a plan which established five zones with a lot of wind power in place or the potential for a lot of wind power. These were called Competitive Renewable Energy Zones. They then authorized a large number of projects to build massive new power lines to carry this electricity to the state’s businesses and homes.
The projects completed in 2013 with a total cost of around $7 billion. Now that the Texas grid has the capacity to effectively move West Texas wind power across the state, curtailments of wind power have been substantially reduced, and occurrences of negative pricing have all but disappeared. For 2013 wind generation in Texas was up 13 percent.
Published with premission from Vault Energy Solutions