Updated: Grid Operator Warns Summer Blackout Threat Could Recur

Updated, Thursday, 4:45 p.m.:

Trip Doggett, the chief executive of ERCOT, said in a press call that the magnitude of the shortfall in backup power "was not expected," and the surprise was due to a large, planned new coal plant being unavailable.

Also, reactions to the ERCOT report are rolling in. Texas Competitive Power Advocates, a group representing power plant operators and other electric companies, said that the report showed the importance of "proper pricing signals" to facilitate investments in new plants. But Randy Moravec, the executive director of the Texas Coalition for Affordable Power, issued a statement warning against efforts to increase wholesale prices, which "will ultimately flow to the electric bills of homeowners, businesses and local governments throughout the state."

Environmentalists argued that the ERCOT report showed the importance of energy-saving measures. Colin Meehan, a clean energy analyst with the Environmental Defense Fund, said that it was vital "to look to technologies that don't use water, like wind and solar power, and lower customer demand during peak times."

Original story:

In a report released Thursday, the state's electric grid operator indicated that next summer could see a repeat of the rolling blackout threats that plagued Texas past summer. The reason: rising demand for electricity and some power plants going offline.

"If we stay in the current cycle of hot and dry summers, we will be very tight on capacity next summer and have a repeat of this year's emergency procedures and conservation appeals," Trip Doggett, chief executive of the Electric Reliability Council of Texas (ERCOT), said in a statement.

If crazy weather — like the deep freeze in February that caused large numbers of power plants to break down — hits again this winter, outages could also result then, according to another report, which was also released Thursday. But Doggett put the risk of this happening in the wintertime as "very low."

Among the power plants ERCOT expects to go offline are two units of Luminant's 1970s-era Monticello coal plant, in Titus county. Luminant has said that new pollution rules from the federal Environmental Protection Agency will make it impossible to operate the plant next year and that the agency's efforts to soften the rule in response to such concerns have not gone far enough.

ERCOT is also concerned about the ongoing drought, because power plants that use natural gas or coal or nuclear power rely on vast amounts of water to cool their equipment. Altogether, nearly 11,500 megawatts of electric generation in Texas "relies on water sources that are at historically low levels," the report said. That's roughly 18 percent of the grid's  installed capacity for the winter, though arrangements with other power plants not normally counted can increase that total capacity figure.

ERCOT's warning comes a few days after a national electric-reliability group released a report citing Texas and New England as places where the long-term ability to avoid blackouts is of particular concern.

In all, ERCOT said today, some 2,234 megawatts of power-plant capacity is expected to go offline by next summer. This means that if there is an electricity crisis, fewer power plants will be available as backup. (Happily, however, weather experts believe next summer will not be quite as hot as last summer.) In addition, ERCOT said, some 1,259 megawatts of planned power plants have been delayed or put on hold, including a solar plant in Travis County and a wind project in Jack County as well as two coal plants.

ERCOT is working on steps to combat the threat of blackouts, by helping craft new rules to incentivize homes and businesses to lower their afternoon electric consumption. (Summer afternoons are when power demand is greatest, due to air-conditioners running full-blast in the heat.)

The report may highlight ongoing concerns about the ability of the deregulated Texas electric market to incentivize the building of new power plants. In other words, despite the high wholesale prices that accompanied last summer's heat — at least some of which got passed on to consumers — Texas electricity regulators have been concerned that prices may not be high enough to encourage companies to invest in new power plants. Large numbers of new power projects are in fact planned for the future, but there is no guarantee that they will be built.

"We're really reviewing the way the market sends signals, and whether they're sufficient to incent the building of generation, or whether we need to change those," Donna Nelson, the chair of the Public Utilities Commission, which regulates the grid, told the Tribune in September.

The conservative Texas Public Policy Foundation, in a statement, said the ERCOT report showed that caps on wholesale electric prices had proved problematic, as have renewable energy subsidies. “To ensure adequate supplies of electricity in the future, we have to eliminate harmful regulations so that the market can do its work," said Bill Peacock, TPPF's vice-president of research.