2011 was a challenging year for the operators of the Texas electricity grid. 2012, however, isn’t going to be any easier. This according to ERCOT who holds the responsibility of insuring the reliability of the Texas grid. There are a large number of the electricity generating plants that are scheduled to be decommissioned over the coming months and still others that will be turned on later than initially expected.
This continues the trend from 2011 where the grid struggled to meet demand following the loss of around 7,000 MW of output. The impact of that loss was felt when ERCOT was forced to orchestrate rolling blackouts during severe cold weather in February.
ERCOT has taken 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.
ERCOT is expressing the urgency of the situation to the electricity operators in the state. They have approached the state’s transmission operators and asked for a thorough top-down review of current projects that are expected to be plugged into the grid over the next year. They need to have assurances that the assumed completion dates for projects that will begin feeding the grid are accurate. ERCOT’s chief executive cited new EPA rules among other factors as reasons why there is no margin of error when it comes to planning out the available capacity of the grid over the coming year.
In many ways the Texas electricity system has found itself caught in a perfect storm of weather conditions, new environmental regulations, and economic conditions. Texas in the last year experienced a string of weather events not seen before. Unprecedented ice, snow, and temperatures struck the state in February 2011 causing a jump in demand for electricity pushing the grid beyond its capacity. The result was rolling blackouts in a state not used to such things.
A frigid winter gave way to a blazing dry summer. The summer of 2011 was on par with the legendary summer of 1980 in terms of the unrelenting string of 100 degree temperature days. Texans were asked to take voluntary measures to limit electricity usage. This allowed the electricity system to stay on line more or less uninterrupted. But, once again, the system was being pushed near its capacity point. In addition to the extreme temperatures, 2011 is also notable for the continuation of an historic drought in Texas as wells as unrelenting wildfires.
Perhaps somewhat ironically at the same time Texas is coping with this near biblical string of weather events it is absorbing the impact of new EPA regulations. Many market observers have been warning for some time 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. This is far from just a Texas problem. Concerns about how the rules will affect the reliability of the North American grid are being raised by the very group who is in charge of maintaining the reliability of the grid, NERC. The logistics of closing down hundreds of plants even temporarily over a short time span are problematic.
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