As Gov. Greg Abbott signed legislation designed to prevent another major power failure, the state’s main grid suffered the year’s second emergency a week before summer officially begins.
The Electric Reliability Council of Texas this week asked residents to reduce electricity usage due to “tight” power grid conditions after loss of some supply sources due to a heat wave.
At the same time, Abbott extended the emergency he declared when the winter storm hit Feb. 14, knocking out power supplies and sending prices to the maximum $9,000 per megawatt hour.
On Monday, nearly 12,000 megawatts of power generation were offline, prompting calls for conservation. One megawatt typically powers about 200 homes on a summer day, ERCOT said.
By the next day, 1,200 megawatts of power was regained to the grid, and ERCOT issued a statement that the grid “remains strong during record demand.”
"We know it can be tough to change family routines, but yesterday is proof that simple conservation measures really do make a difference," ERCOT Interim President and CEO Brad Jones said in a prepared statement.
"Conservation notices are commonly used tools used by utilities and system operators across the country to ensure the reliability of the electric grid,” he added.
ERCOT said it has been leveraging every resource at its disposal, including activating all available generating units to help serve customer demand before calling for conservation.
ERCOT set a new June record for electricity demand, officials said. Based on preliminary data, the new record is 69,943 megawatts, which exceeds the 2018 June record by about 820 megwatts.
“Power plant owners continue repairs of unexpected equipment failures, and ERCOT is using all the tools in its toolbox to maintain reliability in the face of potential record-setting electricity demand,” the grid operator said.
ERCOT’s failure to keep power flowing in February has led to lawsuits, resignations on state boards and utility bankruptcies. Officially, 151 people died during the winter blackouts, but other estimates put the number much higher.
Under legislation passed in this year’s session, Texas will securitize nearly $1 billion to cover ERCOT’s losses during the week-long crisis in February.
Abbott this week signed Senate Bills 2 and 3 into law to reform ERCOT and weatherize and improve the reliability of the grid.
Abbott made ERCOT reform and weatherization of the power system emergency items this past session. Under those bills, Texas will require the weatherization of power generation facilities, natural gas facilities, and transmission facilities to handle extreme weather.
The Texas Railroad Commission and ERCOT will be required to inspect the facilities, and failure to weatherize these facilities can result in a penalty of up to one million dollars.
The bills also create a "Power Outage Alert" where Texans will receive an emergency alert whenever the power supply in the state may be inadequate to meet demand.
The legislation establishes the Texas Energy Reliability Council to improve coordination between state agencies and industry during extreme weather emergencies and extended power outages.
The bill requires ERCOT to have eight fully independent board members on its 11-member board, and requires board members to be residents of Texas.
"During the winter storm, too many Texans were left without heat or power for days on end, and I immediately made reforming ERCOT and weatherizing the power system emergency items,” Abbott said.
“These laws will improve the reliability of the electric grid and help ensure these problems never happen again.”
A study released June 1 found that electricity prices in ERCOT would have been roughly 73% lower during portions of February's deadly winter storm had regulators not inflated them to the $9,000 per megawatt hour legal cap.
The study was commissioned by Texas power provider Vistra and conducted by by London Economics International.
PUCT directed ERCOT to increase electricity prices during the storm in an attempt to increase power supply and reduce consumption as power plants buckled under the high demand caused by the Arctic blast.
Prices stayed around the cap for a 32-hour period between Feb. 15 and Feb. 19, running power suppliers' costs into the billions.
Investor-owned power companies that participate in the ERCOT market reported at least $10 billion of losses from the storm, much of them associated with the abnormally high prices of power and natural gas, according to a report by S&P Global Ratings.
Energy prices would have averaged $2,404 per megawatt hour if not for the PUC orders to increase them, according to the study.
The study said it would be a "straightforward matter" for regulators to unwind the transactions and revert back to real-time energy prices.
