ERCOT: Summer reserves shrink, but forecasts indicate enough supply

Dive Brief:

The grid operator for most of Texas is predicting adequate generation capacity both this summer and in the decade ahead, but has identified scenarios that could cause reserve margins to dip, potentially impacting reliability, Platts reports.
Both the Seasonal Assessment of Resource Adequacy (SARA) and Capacity, Demand and Reserves (CDR) reports "identify uncertainties that could affect outcomes," according to the Electric Reliability Council of Texas (ERCOT).
The summer outlook remains strong, ERCOT said, though weather and outages could impact operations. ERCOT anticipates 78,434 MW of total generation capacity to serve projected peak demand of 70,588 MW this season.

Dive Insight:

Texas's power grid appears to be in good shape for the summer and years ahead, but as always a host of factors could impact that – unplanned generator outages, low wind and warmer-than-expected temperatures.

"We expect to have enough generation available to serve consumer needs this summer, based on the current forecast," said Director of System Planning Warren Lasher. However, he added that a mix of heat, wind and outages "could cause operating reserves to drop below target levels, making it necessary to take additional actions to maintain grid reliability."

The summer SARA report includes 680 MW of new natural gas-fired generation resources that are expected to begin operating by summer peak, ERCOT said, another 410 MW of new planned wind generation capacity (counted at 12% based on historical peak performance in non-coastal regions), and another 7 MW of planned grid-level solar generation capacity (counted at 80% during peak).

A single MW of energy will serve about 200 Texas homes during peak demand periods, typically late afternoons on hot summer days, the grid operator said.

"Although a transition away from El Niño adds some uncertainty to the summer forecast, we expect trends to mirror the average weather over the planning horizon," said ERCOT Senior Meteorologist Chris Coleman. "We could see some temporary, localized hot periods, especially in the Valley and portions of West Texas, with peak demand expected later in the summer."

ERCOT’s CDR report, which examines existing and planned resources and load forecasts for the next 10 years, shows planning reserve margins remaining above 15% through 2026, based on established reporting criteria.

"We continue to see sufficient planning reserve margins in the 10-year outlook, beginning in 2017," Lasher said. "However, this report also includes generation resources that could be affected by environmental regulations, and future decisions by resource owners may impact these projected planning reserve margins."

ERCOT said that since the previous CDR report was released in December 2015, nearly 1,000 MW of new generation has become operational in the ERCOT region, with a peak capacity contribution of about 250 MW.