Interest groups point fingers over Texas’ near-blackout

PowerAd2HOUSTON — The frigid temperatures that blanketed Texas earlier this week have faded. But the state’s brush with blackouts has energized those campaigning for changes to the structure of Texas’ power grid.

Texans for Reliable Power, a group  ran a full-page ad Thursday in the Austin American-Statesman that warns of future power shortfalls in Texas if market modifications are not made.

“With low temperatures earlier this week, we narrowly escaped rolling blackouts,” the ad said. “We won’t be so lucky in the years ahead if we don’t take action now.”

The group is an umbrella organization for several large generators, including NRG Energy, Calpine Corp, NextEra Energy Inc. and Exelon Corp, .

Insufficient power

Generators have led the charge in pushing for a capacity market in Texas, which would pay generators to build and maintain some excess capacity for emergencies, such as a extremely hot days and major plant failures.

They say that the additional payments are needed to incent the construction and maintenance of generation. Currently, under the energy-only system, generators are paid only for power that consumers use.

Power reserves: Debate intensifies on state’s power reserve needs

Generators have argued that current reserve margins — the percentage of generating capacity kept available beyond what Texans use on days of highest power demand – will not be adequate to meet the demands of the growing Texas population.

However, Texans set a winter record for power use on Tuesday without problem. The amount of available power generation was more than 10 percent higher than peak demand, due to much higher wind generation and several plants that came back online Tuesday, according to Dan Woodfin, director of system operations for the Electric Reliability Council of Texas.

Monday’s power emergency occurred when 4,500 megawatts of power generation capacity that had been scheduled to run went offline, partly because of weather-related issues.

Opposition

Several large industrial customers have strongly opposed moving to a capacity market, saying that the state’s power problems are caused by planning issues and poor maintenance, not insufficient reserves.

In a letter to the state’s Public Utility Commission this month, the Texas Oil and Gas Association, a trade group of refiners and petrochemical processors, wrote:

Reliability can be adversely affected by storms and other extreme weather, as well as poor preventative maintenance and system planning. In fact, this is the source of nearly all electric outages in ERCOT. Extreme weather at unexpected times will typically be the most likely source of “capacity” related outages, even when adequate reserve capacity exists.

In a September report, the Electric Reliability Council of Texas, which manages the grid, said that 75,000 megawatts of capacity would be available from December through February, enough to handle even extreme winter weather conditions.

“We expect to be in good shape for the winter ahead,” said Warren Lasher, ERCOT’s director of System Planning, in a November interview. “Even if we see extreme weather conditions, we expect to have adequate resources.”


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