Texas grid asks residents to conserve power as heatwave hits

An electrical substation is seen after winter weather caused electricity blackouts in Houston, Texas, U.S. February 20, 2021. REUTERS/Go Nakamura

Texas's embattled electrical grid operator warned residents to cut electricity use "as much as possible" for the rest of this week, as several days of heat over 90 degrees Fahrenheit (32°C), combined with generation outages, could strain the grid even before summer officially starts.

Monday's warning from the Electric Reliability Council of Texas (ERCOT) comes after the state endured several days of blackouts during an unusual cold spell that left millions without power throughout the state in February.

The freeze underscored the difficulty electric grids can have when confronted with unexpected weather patterns. California on Monday also urged residents to prepare for the possibility of conserving energy in coming days due to the heat. read more

Power prices have soared in California, reaching their highest levels since February, with several days of high heat expected this week across the U.S. West and Southwest. In Texas, real-time ERCOT prices soared to over $2,000 per megawatt hour at several pricing hubs, due to surging demand.

ERCOT came under heavy criticism amid the freeze for the design of its grid, which does not pay operators to keep power generation ready in an emergency. The grid's board resigned due to public pressure following the blackouts, even after several board members defended the grid's performance.

Parts of Texas are expected to see the temperature cross 100 degrees F (37.8 degrees Celsius) in the week before the official start of summer on June 20.

ERCOT was "supposed to have enough reserves to meet peak demand this summer, yet here we are in mid June with the first bout of high temperatures and they are already seeking conservation," said Matt Smith, director of commodity research at ClipperData, a provider of commodities data and analytics.

"It does not bode well for the months ahead," Smith said.

ERCOT said more than 11,000 megawatts (MW) of generation was down due to repairs. The grid operator says the peak demand could surpass 73,000 MW on Monday, which could strain the grid's capacity to generate power for customers.

"This is unusual for this early in the summer season," Woody Rickerson, ERCOT vice president of grid planning and operations said on the number of outages.

Texas is the only state in the continental United States with an independent and isolated grid, which allows it to avoid federal regulation but limits its ability to draw emergency power from other grids. ERCOT also operates the only major U.S. grid that does not have a capacity market - a system that provides payments to operators to be on standby to supply power during severe weather events.

Monday's peak load forecast may exceed 73,000 MW, ERCOT said, adding that the peak demand record for June is 69,123 MW set on June 27, 2018.

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