ERCOT: Energy supplies sufficient for summer peak demand over next decade

Dive Brief:

The Electric Reliability Council of Texas has issued its Seasonal Assessment of Resource Adequacy (SARA) for the upcoming summer along with a preliminary assessment for fall, concluding the state has sufficient generation resources in all but the most extreme of scenarios.
The grid operator expects summer demand to peak near 73,000 MW, while total generation will be close to 82,000 MW. The final Fall assessment will be released in September, but the margin is nowhere near as close—ERCOT expects a 56,000 MW peak in the cooler months, with expected generation resources totaling nearly 87,000 MW.
But while the grid operator expects to meet demand, the report also indicates the summer reserve margins are shrinking, falling from 18.9% in 2018 to 9.6% in 2027, likely due to load growth as the state's economy continues to grow.

Dive Insight:

The Lone Star State continues to set new peak demand records, so the big takeaway from ERCOT's SARA report isn't really this summer but the coming years—and the grid operator says its reserve margins are expected to remain healthy, though they appear to be shrinking due to load growth as Texas experiences a booming economy from energy and tech jobs.

The latest Capacity, Demand and Reserves (CDR) report shows planning reserve margins "well above" 16% for the next five years and exceeding 18% for four of those, according to ERCOT.

"We set a new summer peak demand record last year, and we may set another new record this year," said Warren Lasher, ERCOT senior director of system planning. The grid's peak demand surpassed 70,000 MW nine times in 2016 and peaked at 71,110 MW.

"At this time, we do not anticipate any generation resource adequacy issues during the coming months, although we could see a need for conservation in the case of extended extreme temperatures or very low wind generation output during peak conditions," Lasher said in a statement.

And the region is expecting a boost in generation, including significant gas resources to back up a growing base of wind and solar. The 82,000 MW of expected capacity includes 2,500 MW of planned natural gas-fired generation and about 800 MW of new wind and grid-scale solar additions (though those are expected to contribute only about 350 MW over summer peak hours, based on historical performance).

"For each of the past two years, we received more than 75 interconnection requests from developers who are considering new projects in the ERCOT region," said Lasher. "While many move through the interconnection process and get built, a number of others do not. We update our anticipated planning reserve margins based on the status of interconnection agreements and other factors defined in our Protocols."

Since the December 2016 CDR report, newly added wind and grid-scale solar generation resources total nearly 1,800 MW, according to ERCOT date. More than 10,000 MW of planned resources are included for 2018, with anticipated summer peak capacity of almost 5,500 MW.