An Eventful Week on the ERCOT Grid

A few thoughts and observations about what happened on the ERCOT grid during a scorching August heat wave

Major takeaways, with more details below:

• Solar and storage made a determinative difference this week. Without them, there almost certainly would have been rolling outages. 

• The thermal fleet — the cause of so many of the problems during Winter Storm Uri in 2021, plus many near-misses since — performed moderately well. However, thermal outages were 20% higher than ERCOT expects, and they increased to 30% higher over the course of the tightest day (August 20).

• Prices hit the price cap of $5,000 per megawatt-hour on Tuesday, August 20, but only for about an hour and a half. The system worked as intended: Texas' competitive, energy-only market is working well when it produces low prices most of the hours of the year, then brief intervals of high prices to spur additional generation — with no conservation calls or energy emergencies.

• Demand response played a big role this week, too, though you can’t see it like other resources on the ERCOT dashboard. In 2022, ERCOT quantified the reduction from big users at more than 4,500 megawatts. It’s likely larger now. However, due to antiquated rules and practices, that demand response kicks in around 5pm and may actually cause higher demand in the critical 7-9 pm period. Policymakers need to consider changing those hours to better reflect the needs of the grid. More importantly, it's past time for the state to create opportunities for Texas families and small customers to cash in on demand response savings, too. 

More on all of this, with data and graphs, for paid subscribers below. If you aren’t yet a paid subscriber, please become one today. If you can’t afford a subscription but would like to read on, please request a complimentary subscription in an email to stoicenergyconsulting@gmail.com.

Solar production grew 60% over the last year, greatly increasing reliability