Hurricane Harvey’s Impact on Texas Electricity Grid

High winds and significant flooding along the Texas Gulf Coast substantially impacted the Texas electricity grid.  The transmission and distribution infrastructure sustained severe damage in the southern portion of the state as a result of Harvey’s landfall.  10,000 megawatts of electricity was lost to the grid according to the Electric Reliability Council of Texas (ERCOT).

The loss of generation capacity was offset by a large drop in electricity demand across the state.  The loss in demand was a direct result of downed transmission lines.  Leaving hundreds of thousands of Texans without power at times.  The grid also benefited from a drop in temperatures across the state during the period when the loss of capacity was at its greatest.

Many factors associated with the storm combined to reduce electricity output.  Several power plants went offline as a result of flooding that impacted the delivery of fuel supplies to the generator facilities.  These same transportation difficulties kept personnel needed to run the plants from getting to work.

Near the coast where winds exceeded 130 miles per hour, many high voltage transmission lines were taken out of service by the damaging winds.  Further inland in the Houston area, flooding took a larger toll on transmission facilities.  Capacity was also lost due to loss of wind power.  Wind turbines are turned off when wind exceeds 55 mph in order to avoid damaging the equipment.

Power loss along with the failure of a backup generator were to blame for explosions at the Arkema chemical plant.  The plant stored chemicals that become volatile when not cooled to a certain temperature.

Meanwhile, many electricity providers in Texas stepped up to help in relief and rebuilding efforts.  NRG, the parent company of Reliant Energy and several other electric brands in Texas donated one million dollars to organizations including the Red Cross, and the J.J. Watt Houston Flood Relief Fund.   Direct Energy, the parent company of Bounce energy and the Direct Energy retail brand is matching donations up to $25,000 the Red Cross.  TXU Energy is allocating $500,000 to help customers who are unable to pay their electric bills in the wake of Harvey.

Texas Electric Grid Has Adequate Capacity for Summer/Fall 2017

ERCOT has released its latest Seasonal Assessment of Resource Adequacy for the summer months.   The organization anticipates that the Texas electric grid will have no trouble meeting the demand for electricity during the hot summer months from June – September.   The report forecasts a peak demand of 73,000 megawatts for electricity during the period.  This is based on the average demand for that same period over the last 14 years.

Against this demand, officials are projecting a peak production capacity of 83,000 MW.  Included in this total is 2,500 MW of new natural gas powered generation and 800 MW of new wind and utility scale solar generation.  Because of the intermittent nature of wind and solar energy generation, only 350 MW of peak power from wind and solar are being included in the projections of summer capacity.

There is no new coal power electricity generation included in the forecast.  Coal continues its multi-year decline across the U.S. and in Texas in particular due to a combination of environmental regulations, competition from renewable energy sources and cheap natural gas.  Cheap natural gas more than anything else has helped to keep electricity rates in Texas low for several years.

In a separate report, ERCOT looked at generation over the next five years.  The trend is unsurprising.  Summer capacity is expected to rise to over 87,000 MW hours in 2022.  Wind, Solar and Gas are expected to grow both in real terms and as a percentage of total capacity.  Coal is expected to continue to decline.

The Texas electricity market continues to be a model for the benefits of energy deregulation.  Capacity and reliability continue to improve.  This is occurring with a lower per kWh environmental impact thanks to the proliferation of renewable energy in the state.  Additionally, giving consumers the power to choose their electricity provider has led to innovations in the way electricity is sold to end users.   All of this is occurring in an environment of sustained low rates.

See Also: Oncor Proposes Electricity Rate Increase for Many Texans
See Also: Electricity-Related Complaints Continue Downward Trend In Post-Deregulation Texas Market

 

2016 Another Strong Year for Renewable Energy and Natural Gas

2016 Renewable EnergyContinuing a 3 year trend, 2016 saw renewable energy account for the majority of new electricity generation capacity in the United States.  The lion’s share of these additions came in the form of wind and solar power.

As is often the case, renewable energy generation peaked in the spring on a nationwide basis.  The spring typically sees a peak in hydroelectric power in the western part of the U.S. as rain and snowmelt drives hydro power. The Western United States also contributed the majority of the country’s solar power with 77% of total U.S. solar generation.  In Texas, the state’s massive installed wind base continued to churn out electricity for the Texas electricity grid which is separate from the other major U.S. electricity grids.

While 2016 also saw a large increase in solar power, most new solar capacity comes from small scale solar photovoltaic rather than large scale utility generation.  As of October of 2016 the U.S had a total of 12.6 GW of small-scale solar power installed.

Wholesale Electricity Rates Continue to Fall

Despite the fact that new capacity generation is coming largely from renewable energy sources, it is cheap natural gas that continues to put downward pressure on electricity rates.  Monthly wholesale prices for 2016 were lower than 2015; driven largely by lower natural gas prices.  The cost of natural gas delivered to power generators was 17% lower for the first 10 months of 2016.

Low rates for natural gas also contributed to an increased reliance on natural gas for electricity generation.  2016 saw, first the first time, natural gas surpass coal for electricity nationwide.  Although, in Texas this has been the case for a number of years.

 

Texas Sets Another Record For Wind Power

Texas Wind EnergyTexas has set a new record for electricity generated from wind.  On November 27th 2016, the ERCOT system saw more than 15,000 megawatts of electricity provided to the grid from wind turbines.

The amount represented about 45% of the spot demand for power in the grid in the afternoon.

“We saw high wind output throughout the day, ranging from just over 10,000 MW during the late night hours to this peak output during the noon hour,” said ERCOT Senior Director of System Operations Dan Woodfin. “Over the years, ERCOT has taken a number of steps, such as improving renewable generation forecasts, to allow us to operate the grid reliably on days like this.”

During the period, total output from wind approach the system capacity of 17,000 MW.

See Also: Wind Energy Provides Cheap Electricity In Texas

 

Electricity-Related Complaints Continue Downward Trend In Post-Deregulation Texas Market

ERCOTOver the last fiscal year Texans filed 4,835 electricity-related inquiries or complaints according to the Texas Coalition for Affordable Power. This represents a significant drop from the previous post-deregulation low set last year, where the Public Utility Commission registered 6,973 inquiries or complaints. Data from the PUC shows a drop across nine different categories of complaints, with only one category seeing an increase. The data from this year confirms the on-going trend of higher responsiveness and customer satisfaction in Texas’s deregulated retail energy market.

A Continuing Trend Based On Increased Customer Satisfaction

The almost 31% drop in electricity-related inquiries and complaints registered between 2015 and 2016 is the second largest drop so far recorded. Two of the main factors influencing this trend are lower energy prices and a growing familiarity with the conditions and providers of the deregulated market. Also, two major sources of complaints, Sharyland Utility and the installation of advanced meters, are no longer the source of as much dissatisfaction among customers.

The PUC registered a fall in almost every category of electricity-related complaints over the 2015 fiscal year. This falling rate of complaints includes a number of major categories of complaints, such as provision of service complaints, meter complaints and complaints related to switch-holds, the blocking of electric service for residences.

The data for 2015 suggests that customer satisfaction continues to see significant improvements across the state of Texas. The last three fiscal years in particular are registering increasing levels of customer satisfaction. While the data still shows a higher number of inquiries and complaints than pre-deregulation levels, the strong and on-going trend suggests that levels may soon approach their pre-deregulation lows.

See Also: Electricity Sales Continue Multiyear Decline

 

Cheap Natural Gas Leads to Falling Consumer Electricity Rates

Plunging oil prices may have hit some energy companies hard and have some oil-producing nations worried about their budget deficits, but it has been a boon to the average American consumer as electricity rates have dropped 1% nationwide to an average of 12.4 cents per kilowatt hour, the first nationwide decline in energy prices in decades.

electricity_rates

As developed nations move away from burning dirty coal for energy as a result of the efforts to meet international greenhouse emission caps, cleaner burning natural gas plants and alternative energy sources (wind, sun, geothermal, etc) are filling in the gaps. Natural gas is now the major source of fuel for energy producing plants, and a 28% drop in the price of natural gas for energy producers over the first half of the year has translated into big gains for consumers nationwide.

However, the replacement of coal burning plants with plants that use natural gas and a plunging price in hydrocarbons is not the entire story. Solar and wind energy in particular continue to become more efficient with advancing technologies, and are taking an increasing share of national, and international, energy production. This year the United Kingdom produced more energy from solar panels than from burning coal, and marked the first day since 1882 that no energy was produced from the burning of coal across the entire nation.

The state of Texas has enjoyed an even greater drop in consumer electricity prices, down 6% to 11 cents per kilowatt hour, thanks to easy access to plentiful supplies of cheap natural gas and a deregulated market. The deregulated market has allowed producers to adjust their prices sooner to reflect the lower cost of natural gas, and then pass these savings on to the consumer.

New England, which has a similar share to Texas of energy produced by natural gas, saw a similar decline in electricity rates over the year. However, the biggest decline of 12% was observed in the state of Hawaii, which uses oil for the vast majority of its energy production. The steep decline in the price of oil helped to bring electricity rates down substantially, albeit from a position that was far above the national average as a result of the state’s remote location and the difficulties that its geography causes for the installation of energy infrastructure.

 

Coal’s Importance To Texas Electricity Continues To Decline

smokestackThe use of coal to generate electricity in Texas continues to slide.  Just ten years ago, half of the electricity in Texas came from the burning of coal.  Today, coal only contributes 20%.

Why the huge drop off?  The two main factors are natural gas and wind energy, with solar and hydro also playing a part.

Texas is by far the largest producer of natural gas in the U.S., more than doubling the production of the #2 state, Pennsylvania.  Texas is now producing so much natural gas, that a pipeline is being built that will send a significant amount of natural gas to Mexico to be used by their electricity generators.

Texas also produces more electricity via wind energy than any other state.  There have already been days when the state saw more electricity produced from wind than from coal.

It is expected that by 2020, more than half of all coal-burning power plants in Texas will be shuttered.

 

Enough Electricity In Texas For Spring As Renewable Energy Surges

ERCOT, the organization responsible for maintaining the Texas electricity grid, is predicting more than adequate capacity in the spring amidst an expected surge in renewable power for the state in 2016.   In its Seasonal Assessment of Resource Adequacy, ERCOT is predicting a spring usage peak of 58,279 MW.  This is well within system capacity even with the assumption that there will be 9,482 MW of lost system capacity due to maintenance and forced outages.  This is based on historical outage data going back to 2010.  The demand estimates were made using May 2006, a hotter than normal May, as a model.

Due to the fact that Texas’ operational solar capacity recently passed a threshold of 200 MW, the methodology for determining how much solar power to include in capacity projections has changed.  This resulted in a decreased amount of solar power included in the spring projections.  However, 2016 is expected to be an exceptional year for solar energy in Texas.

ERCOT Solar

By some estimates, the state will see an additional 2 GW of installed solar capacity in 2016.  This would result in a 10-fold increase in solar electricity.  Texas has long been considered a sleeping giant when it comes to solar power. Although it has the geography and climate to be a substantial producer, it has had very little in the way of utility scale solar power.  This is changing in a big way with projects underway for both the Austin and San Antonio municipal utilities among others.  The Austin project, in particular, is notable for its low cost. The purchase agreement for that project calls for a rate of less than 5 cents per kilowatt hour.  This is cheap even when compared to natural gas.  Several years of cheap natural gas have led to low electricity rates in Texas and created a challenging environment for solar and natural gas to compete on price.

Despite this, renewables have continued to gain ground in Texas, led by wind in particular. Wind, along with solar, make up around two-thirds of the state’s additional capacity for 2016.  Of the 12,500 MW in new power expected to come online, wind will account for about 63%. 2016 will likely see wind overtake coal as the second largest source of electricity in the state.

Although coal is rapidly becoming a smaller contributor to the state’s electricity output, coal plants are still critical for keeping the lights on in Texas.  The report downplays any potential impact of compliance with the Mercury and Air Toxics Standards regulations for coal units.   With the final compliance date being April 15, 2016, planners expect generators to be in compliance.

The preliminary summer report predicts record peak electricity usage for the state with demand peaking at over 70,000 MW for the first time.  Against this, it is predicted that the system will have over 79,000 MW of available generation.

Texas And Oklahoma Ban Fracking Bans

frackingIn Texas, where electricity rates have been on the decline, the natural gas boom has brought about both cheap electricity and bolstered the state’s economy.

The technique of “fracking”, or injecting water in high-pressure jets to fracture shale deposits and release pockets of oil and gas to the surface, has been widely touted by its supporters as a way to achieve energy independence from foreign sources of fuel. We all remember cries of, “Drill, Baby, drill!” echoing throughout the land. In the wake of 2005’s Energy Policy Act, fracking started taking hold, and it has been growing ever since.

Is Fracking Causing Earthquakes?

In the Dallas metro area, which had seen almost no earthquake activity in the 58 years prior to 2008, there have been more than 130 temblors since.  Irving, Texas recently experienced 11 quakes in 24 hours. Oklahoma has been hit particularly hard: Having only had a handful of quakes measuring a magnitude of 3.0 or greater on the Richter scale per year from 1975 to 2008, it has seen a huge increase in seismic activity: In 2009, there were 20 earthquakes measuring 3.0 or greater; in 2011, among almost 60 such quakes, the largest earthquake in Oklahoma’s history, a 5.7 magnitude tremor, occurred. The number of earthquakes has shot up even more since then: 2013 saw 109 such earthquakes, and in 2014 there were 585. Based on numbers so far this year, it’s possible that Oklahoma will have 900 such earthquakes.

In a report issued early in May, researchers at Southern Methodist University (SMU) in Dallas concluded that oil and gas activities are “most likely” the cause for the increased seismic activity in the area they studied around the towns of Azle and Reno, near Fort Worth, which sit atop the Barnett Shale, an oil-and-gas-rich geological formation into which 17,500 new wells have been drilled over the past 15 years. The specific activity that could be linked with the quakes is not the fracking itself, but the disposal of wastewater by-product by injecting it, also at high pressure, into deep wells, which apparently causes shifting around existing faults, thereby causing the tremors.

While the SMU report resists drawing a definite conclusion as to cause, the United States Geological Survey doesn’t hedge: A USGS report released in April states that, “Earthquake activity has sharply increased since 2009 in the central and eastern United States. The increase has been linked to industrial operations that dispose of wastewater by injecting it into deep wells.”

States Prevents Cities from Banning Fracking

In its most recent legislative session, The State of Texas passed a law prohibiting local communities from enacting bans on any fracking or drilling activity–including the use of injection wells. This law is seen as a reaction to a municipal ban enacted by the town of Denton in North Texas, whose citizens were concerned about wells that were being drilled in residential areas. The oil and gas industry felt that this ban impinged upon their property rights, and The Texas Oil and Gas Association (TXOGA), along with the state’s General Land office, filed a lawsuit against the City of Denton the day after the ban was passed.

The industry went to the Texas legislature to head off any further municipal uprisings, and House Bill 40, which prohibited any further bans, was born. Passed by the Republican legislature and now signed into law on May 18 by Republican Governor Greg Abbott, who characterized the legislation as a move to limit government bureaucracy.

Denton Residents say the wells have polluted the local water, and there has been increased drilling within 200 feet of schools, public parks, and even homes.

For its own part, after years of denying any link between the burgeoning seismic activity and the growth of the fracking industry, specifically the use of wastewater injection wells, Oklahoma has taken a surprisingly strong step in acknowledging it. The Office of the Oklahoma Secretary of Energy and Environment has created a website called Earthquakes in Oklahoma ( http://earthquakes.ok.gov/ ), which features an interactive earthquake map that shows how earthquakes have gone from being very few and scattered around the state in the pre-fracking era to being numerous and concentrated in very specific locations.

Although the map itself does not state that these are the areas in which fracking activity is also concentrated, the section of the website labeled “What We Know” does affirm that the recent rise in seismic events can’t be attributed fully to natural causes and goes on to state that “The Oklahoma Geological Survey has determined that the majority of recent earthquakes in central and north-central Oklahoma are very likely triggered by the injection of produced water in disposal wells.”

However, the state of Oklahoma has followed Texas with similar legislation against fracking bans. A week after Abbott signed off on the Texas law, Oklahoma’s Governor Mary Fallin, signed a bill into law that would prevent municipal regulations of drilling activities, causing Norman, OK Mayor Cindy Rosenthal to voice concern that cities might not be able to regulate the disposal of wastewater into the drainage basins of municipal water supplies.

In Texas, natural gas is the largest source of electricity generation electricity companies and consumers have both benefited from cheap natural gas in the last several years.

 

 

Georgetown To Be First City In Texas To Go To 100% Renewable Energy

green electricityGeorgetown, Texas plans to be the first city in the State to go completely green, with an aim toward getting 100% of its energy from renewable sources, namely solar and wind power. Through a 25-year deal with SunEdison, the city of Georgetown will purchase 150 MW of energy, beginning in 2016. This power will be provided by solar farms that SunEdison, the world’s largest renewable energy company, plan to construct in West Texas. Georgetown also contracted EDF Renewables to provide 144 MW of wind energy from the Spinning Spur 3 wind farm, under construction outside Amarillo. That deal, inked last year, will run through 2039.

Texas has an already-burgeoning wind power industry and has the potential to be a national, if not global, leader in solar power, as well, considering its size and solar exposure. Solar power hasn’t had an easy time getting a foothold without much support and financial incentives in a state more known for oil than practically any other commodity. But now that costs have decreased dramatically for solar power production, the winning factor that made the decision easy for Georgetown turned out to be not so much environmental ideals as price.

Yes, that’s right–the renewable option was also the most economically feasible one. There’s a bit of a “gold rush” on currently to develop the West Texas area for solar and wind power, and municipalities may start to reap the benefits soon, as costs drop lower and lower. Georgetown isn’t waiting, and it plans to join other such forward-thinking cities as Burlington, Vermont, already in the 100% club. Not all Texas cities have their own utilities, as Georgetown does. In most areas, consumers buy power directly from retailers, some of whom do offer power provided by 100% renewable energy. (See “Organic Power Promo” by Bounce Energy and this 100% Wind Energy plan by Green Mountain Energy)  As solar and wind power continue to become more affordable, correspondingly lower utility rates are likely to increase consumers’ preference for renewables, possibly to a tipping point that will make fossil fuels look like a last resort.

Another benefit of investment in renewables for Texas is that solar and wind power do not require the use of water, as the production of power from fossil fuels does. This is a legitimate concern for an area that can suffer from crippling drought. A switch to clean energy can provide a one-two punch in this area, though; not only does it reduce water consumption on an immediate basis, the reduction in greenhouse gases caused by large-scale adoption of renewables could possibly help mitigate the drought-producing effects of climate change, over the long term.

The combination of wind and solar are anticipated to be particularly successful because they are complementary to one another. The blazing afternoon Texas sun traditionally puts peak demand on the grid, but the use of solar power allows that very sun to provide the supply, as well. Wind, on the other hand, tends to occur at times that the sun doesn’t, so energy from wind power can supplement solar energy conveniently. And unlike fossil fuels, whose price and availability can’t be predicted over any kind of long term, the sun and wind are locally produced, so to speak, and as reliable as anything ever gets. The fact that these energy sources are also non-polluting and water-saving, as well as being cheap and reliable, is just icing on the cake.