Thursday, January 24, 2019

ERCOT Gains Additional Capacity to Meet Summer Demand

By Tom Kleckner

ERCOT will have more breathing room as it prepares for record demand this summer after an additional 525 MW of generation recently came online in Texas.

The ISO said Monday it now has 78.2 GW of capacity available to meet an expected peak demand of 72.8 GW, which would break the 2016 record of 71.1 GW. The additional capacity has boosted ERCOT’s planning reserve margin from 9.3% to 11% since the previous seasonal assessment of resource adequacy (SARA) report.

“That definitely improves the situation,” said Pete Warnken, ERCOT’s manager of resource adequacy, during a media call Monday.

The additional generation comes from the 225-MW, gas-fired Denton Energy Center that recently went into service in North Texas and the return of the mothballed 300-MW gas unit at Barney Davis in Corpus Christi.

ERCOT summer peak demand planning reserve margin

South Texas Nuclear Generating Station

Warnken said rotating outages are still possible under extreme scenarios, “but that risk has been reduced a little bit with those resources.”

ERCOT has approximately 2.3 GW of capacity available through load-control measures with transmission or distribution service providers. Tight reserves could also trigger the need for the ISO to deploy ancillary services and contracted emergency response service capacity to maintain sufficient operating reserves.

Staff also expects industrial facilities to make voluntary load reductions and increase the power they sell into the market during peak demand.

“We expect the market to respond to scarcity conditions,” Warnken said. “It’s a good bet to expect they’ll be looking at summer conditions and making decisions appropriately before they bring their resources on.”

ERCOT summer peak

ERCOT’s Dan Woodfin | © RTO Insider

Dan Woodfin, the ISO’s senior director of system operations, said the grid will also benefit with the completion of the Houston Import Project, a $590 million effort that will allow more power to be imported from the north.

“All the pieces are in service at this point,” Woodfin said. “That will help reduce congestion into the Houston area because it improves the transfer capability.”

ERCOT also released its latest Capacity, Demand and Reserves (CDR) report, which includes planning reserve margins for the next five years. The reserve margin peaks at 12.3% in 2020, before dropping to 8.9% in 2023.

The CDR report adjusts the 2019 summer demand forecast down to 74.2 GW, reflecting a delay in a new industrial facility on the Texas coast. Staff expects the load forecast to eclipse 77 GW in 2023. That number includes the planned integration of Lubbock Power & Light’s customers, which is scheduled to take place in 2021.

The ISO’s target planning reserve margin is 13.75%. Warnken said staff is studying an economically optimal reserve margin, which would balance the amount of generation needed to maintain reliability with its cost.

The next CDR report will be released in early December.