In its latest seasonal assessment of the state’s grid, the Electric Reliability Council of Texas (ERCOT) says that the state’s available generation capacity should be more than sufficient to meet anticipated demand for electricity in the fall and winter seasons.
ERCOTS seasonal assessment predicts a peak demand of 47,000 MW in the fall of 2013 while available generation is expected to be 74,000 MW. This creates a comfortable margin even in the event of unexpected losses in generation or weather related spikes in demand. The picture for the winter of 2013 / 2014 is similar with comfortable margins projected.
Officials and the public have watched the state’s capacity situation closely for the past few years after several scares in 2011 that lead to the threat of rolling blackouts for much of the state. Ongoing drought conditions within the state have also created concern for the electricity supply. Fresh water for cooling is a requirement for many methods of generating electricity.
Despite occasional warnings about potential tight electricity supply, Texas has not had a real power crisis since 2011. ERCOT predictions of electricity usage have been too high recently with Texans using less power than anticipated. This has left some to wonder if the capacity crisis in Texas has been somewhat overblown.
Among the proposals to address potential future shortfalls in electricity capacity is a plan to transition Texas to a ‘capacity market‘. Consumers and consumer groups are not onboard with a transition to a capacity market. Such a change would result in effectively higher electricity rates as new fees are attached to electric bills to prefund the construction of new power plants. The state’s electricity generators are generally in favor of a capacity market because it would reduce their risk of building new capacity by paying them up front to build new plants. Under the current system producers only get paid when they sell their electricity in the market.