Unexpected plant outages pushed Texas into winter power emergency

HOUSTON — The unexpected closure of two plants in north central Texas Sunday night pushed the grid close to the brink of rolling blackouts Monday morning, according to the Texas grid planner.

Wholesale electricity prices soared above a state-mandated cap for nearly an hour around 7 a.m., an indication that the system was nearing its limits.

The two plants, which are now back online, accounted for about half of the unexpected 3,700-megawatt drop in available capacity Monday morning. That, combined with freezing temperatures, pushed the grid into emergency alert conditions, according to the Electric Reliability Council of Texas. The other half of the drop was caused by various unexpected mechanical issues at plants across the state.

“We were close,” said Dan Woodfin, ERCOT director of system operations, explaining that if one more power plant had been forced to shut down, it would have triggered rolling black outs.

A cold front pushed temperatures well below freezing overnight across Texas and sent Houston-area temperatures to a low of 28 degrees by 7 a.m. Monday. That spurred demand for electricity to rise to 55,486 megawatts in the following hour, about 11,700 megawatts short of last year’s peak demand, which occurred in August. One megawatt is enough to power about 500 homes under normal conditions in Texas or about 200 homes under extreme conditions.

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Woodfin said the two plants probably shut down because of  frozen moisture in critical instrumentation lines.

Power plants are weatherized by protecting the sensitive pipes and instruments around the plant from extreme weather conditions. Typical weatherization could include insulating exposed surfaces of external piping and creating barriers to block wind from certain instruments.

Weatherization plans are required of all generators to keep plants running in the winter. More than 20 plants to shut down during a cold snap in February 2011, spurring Texas’ last series of rolling blackouts.

“We have also been making site visits to random generators, to make sure that they are implementing their weatherization plans,” Woodfin said. “But it could be that they left out one piece and that could have been enough to take them off line.”

But some critics say that generators with multiple plants could benefit from a single plant outage, because of the resulting price increases for all remaining generation.

“It is much more profitable to have outages than it is to spend money on maintenance and winterize generators,” said Ed Hirs, an energy economics professor at the University of Houston.

The spot market for electricity typically trades at roughly $30 to $100 kilowatts per hour under normal conditions. It shot up above $5,000 per kilowatt-hour Monday morning, exceeding the $4,500 cap because of additional transmission costs, according to Robbie Searcy, a spokeswoman for Ercot.

“For generators with multiple plants on the grid, there is a perverse incentive to have an outage and capture the much higher prices,” Hirs said. “Ercot is going around checking plants to see if they have been winterized. Obviously they understand that they have a huge exposure to being gamed.”

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