AUSTIN, Texas — The Texas Energy Summit continued its focus on the Texas Emissions Reduction Plan as it gathered in person for the first time since the February 2021 winter storm that nearly collapsed the ERCOT grid.
The summit organizers from the Texas A&M Engineering Experiment Station’s Energy Systems Laboratory have long emphasized a focus on energy management. However, the lead panel addressed — what else, after last year’s storm? — increasing the ERCOT grid’s resilience.
Moderator Evan Smith, the Texas Tribune’s CEO, noted the grid didn’t collapse during last month’s winter storm, which was considerably less severe than the previous year’s storm. (See ERCOT Breezes Through Latest Winter Storm.)
“Problem solved. Panel over. Do we really have to increase resiliency?” he asked his panel. “Isn’t everything okay, based on what happened a couple of weeks ago?”
“We know we're making progress,” said Caitlin Smith, senior regulatory director for Jupiter Power, an energy storage resource consultant. “Things are changing in Texas. Our generation and our demand is changing. You have to constantly be working on it. I don't think there's ever going to be a point where everything is fixed and we're done.”
Virginia Palacios, executive director of Commission Shift, which seeks to reform natural gas regulator Texas Railroad Commission, noted the most recent storm was only the seventh coldest in the last 12 years.
“It got cold, and the grid held up. That’s not something that should be celebrated,” Evans responded.
Still, this winter’s weather activity resulted in reduced gas production in West Texas, Palacios said.
“There are gas facilities that are not winterized. If we had a severe storm, we could expect more outages,” she said. “So, there’s a chink in the armor.”
State Sen. Jose Menendez (D) agreed, referencing ERCOT interim CEO Brad Jones’ recent comment that natural gas production declines might point to the grid’s continuing vulnerability because of its reliance on gas generation.
“That was not [U.S. Rep. Alexandria Ocasio-Cortez] saying the quiet part out loud,” Menendez said. “Gas is a weather-dependent resource. We still see signs of problems on the horizon.
“At the end of the day, there’s no free lunch. Do you pay to keep the lights on? How much do we pay?” he asked. “Building more gas plants … that would all be on the backs of the consumers. That’s why we should focus on energy efficiency and demand response. How can we do more on the demand side, so we don’t need as much generation as quickly as we think.”
“We know what the problem is. The problem is expectations on different resources,” Smith said. “We expected gas to be there, and then it wasn’t.”
While the conference was focused on clean energy and air, the specter of Russia’s invasion of Ukraine hung over the proceedings.
“Air quality is really in the DNA of this summit. … Obviously, these are extraordinary times,” said Stoic Energy President Doug Lewin, who helped coordinate the event. “There can be discussions about how our oil and gas sector can support our allies abroad … but we ought to be thinking about our allies abroad and Ukrainians that are suffering so deeply right now.”
Smith opened the summit with an update on the state’s recent primaries and its political outlook, but the first question he fielded from the audience was about oil politics.
“Well, [Texas does] benefit from higher oil prices, right?” Smith said. “Prices over $100 a barrel tend to be good for the economy and good for the state’s bank account, but I don't think anybody wants to profit off of Russian tyranny.”
“We're seeing this really huge crisis that even I am having trouble sort of wrapping my brain around,” said Amy Myers Jaffe, research professor and managing director of the Climate Policy Lab at Tufts University’s Fletcher School in Massachusetts.
Jaffe, who recently published her latest book, Energy’s Digital Future, referred to the global energy markets’ “mega crisis,” with gas and oil prices both rising to levels not seen for years.
“We're really in a very tenuous situation with a very fragile market,” she said. “Gas prices are at historic highs, and we know from history that these kinds of crises end — especially when its oil-related — with a global recession. That is how prices come down.”
But Jaffe also pointed to a bright side: “We know each time this happens, we get new technologies, new energy efficiency, new government policies that lower demand.”
Participating in a panel discussion on replacing Texas’ highest polluting power plants with cleaner and more reliable resources, Daniel Cohan, an associate professor at Rice University, said any replacement resources will have to come from Texas, given much of the state’s isolation from the rest of the country’s grid.
“The replacements for the polluting power gird will have to come from Texas. … That’s not true anywhere else on the continent,” he said, noting that most of the state’s power capacity is more than 30 years old. “We keep them because they ‘keep the lights on.’ Maybe they’re killing us, but you can count on them. Except when they’re not actually there for us, such as during the February storm.”
“The gas plant existing isn’t the problem,” Cohan said. “The problem is how much it’s used.”
Several speakers offered up virtual power plants as being among the new, enabling technologies that could eventually replace conventional resources. Virtual power plants rely on aggregated rooftop solar customers or community distributed solar, often with battery storage.
Using a suburb north of Houston as an example, Jaffe said, “Imagine if everyone in The Woodlands had rooftop solar and also had something the size of the washing machine in their garage that stores that electricity. Say the developer of this [distributed energy resource] system gives everybody a battery 30% larger than their electrical use.
“Then, when it’s not sunny or there is a surge in demand for heat, we aggregate that 30% of everybody’s batteries. That’s why it’s called a virtual power plant,” Jaffe said. She said a similar system in Western Australia prone to massive brownouts proved to be a “very robust” solution.
Closer to home, Jaffe said California’s experience after the Aliso Canyon natural gas blowout in 2015 fed the states’ optimism to pursue a 100% renewable energy goal. Developers offered to replace the natural gas capacity with solar energy and batteries. They installed 104 MW of solar and battery storage in a matter of months.
“And it’s still operating and it’s still working today,” Jaffe said.
“The cleanest energy is the kilowatt-hour you don’t use,” pointed out Keri Macklin, vice president of strategic energy management and carbon consulting for CLEAResult. She said placing a price on carbon has proven to quickly transition power companies from coal usage.
“It’s making it economically unfeasible for those coal plants to continue to run. That’s the cleanest and fastest way to do it,” Macklin said. “Politically, it may be more difficult, but it’s a very quick way to make the renewable energy more profitable.”
The Department of Energy’s Kelly Speakes-Backman made a virtual appearance at the summit to explain how the Biden administration intends to put the nation on an “irreversible path to clean energy.”
As the DOE’s principal deputy assistant secretary for the Office of Energy Efficiency and Renewable Energy, Speakes-Backman oversees the agency’s $2.8 billion portfolio of research, development, demonstration and deployment activities in energy efficiency, renewable energy and sustainable transportation.
“Secretary [Jennifer] Granholm likes to say that DOE is America's solutions agency because we never back away from a challenge and because of how the many technologies and areas of society that our work actually impacts,” she said. “For decades, we've already been investing in these innovative renewable energy and efficiency and transportation technologies. But now it's time to recognize and realize those returns on our investment by getting those solutions into the marketplace at scale as quickly as possible.”
Speakes-Backman said no single technology or solution will help the federal government reach its goal of a net-zero economy by 2050. Instead, it will take a coordinated effort in a wide variety of areas, with a strong emphasis on deploying technologies that are close to commercialization.
DOE has established five programmatic priorities: 1) decarbonizing the grid; 2) decarbonizing transportation; 3) decarbonizing the industrial sector; 4) reducing buildings’ carbon footprint; and 5) decarbonizing the agricultural sector.
The agency is relying on collaboration with the National Labs, federal agencies, the public sector and “our state local partners,” Speakes-Backman said, “because we know that we can only build a clean energy future if we're going to be bringing these communities and workers along with us.”
DOE’s success will rely on investments in a diverse, STEM workforce “to provide a pathway forward for communities of workers who risked their lives to produce fossil fuels,” she said.
“We know that we have to build a clean energy economy in a way that's going to benefit all Americans,” Speakes-Backman said. “We have to address the environmental injustice that disproportionately affected communities of color, low-income communities, indigenous communities and rural communities. We're deeply committed to making sure that it's embedded in all of our work.”
Before the 2021 February winter storm waylaid his best-laid plans, State Rep. Drew Darby (R) was pushing a bill that would have shortened the deliberation process for ERCOT economic projects and mandated a biennial ISO report identifying “critical designation” transmission infrastructure projects.
Darby’s bill (HB1607) never made it out of the House, lost in the wave of legislation addressing fixes to ERCOT’s governance and its system following the storm. However, he promises the bill will be back for the 88th Texas legislature in January.
“As a policy matter, I believe we’re still going to need to have this discussion as we move forward in the next session,” Darby, who was first elected in 2006, said. “It takes anywhere from eight to 10 months to actually put in a wind farm, but the evaluation process takes eight to 10 years.”
Darby, a native West Texan, knows the importance of transmission infrastructure. He saw the 2005 Competitive Renewable Energy Zone (CREZ) initiative invest $6.9 billion in 3,600 miles of new, high-voltage transmission lines and pave the way for Texas’ renewable energy boom.
“There was no power generation at the end of [CREZ lines],” Darby said. “I questioned spending that many resources to provide access to power generation when there was no proposed power generation or a single plan. The master plan was … if you build it, they will come. By gosh, we did build it, and they have come.”
With the wind farms, and now the solar facilities, congestion has increased on the ERCOT system. Carrie Bivens, the grid operator’s Independent Market Monitor, said real-time congestion rent — the impact of one additional MW on a constraint — was $2.1 billion last year, up from $1.4 billion the year before. The system incurred $300 million during just one day of the February winter storm.
“It’s growing year over year. … There is a lot of congestion throughout Texas,” Bivens said.
ERCOT has had 16 generic transmission constraints at one time. Seven of those were in South Texas’ Rio Grande Valley, which are being addressed in a PUC-directed project and a $1.28 billion 345-kV line approved by the grid operator’s board. (See Texas PUC Directs Tx Construction in Valley, “Board Approves $1.28B Tx Project,” ERCOT Board of Directors Briefs: Dec. 10, 2021.)
“We have a lot of land [in West Texas], a lot of solar and certainly wind farms. That has created an extraordinary opportunity for my region and Texas, but it comes with challenges that are impeding additional growth for power generation,” Darby said. “Let’s look at these projects in an expedient manner and move them quickly.”