Dive Brief:

• The underperformance of wind energy during a Feb. 1 winter storm in Texas compared to its effectiveness during winter storm Elliott in December demonstrates the need for energy systems to be resource adequate in all scenarios and create a market for reliability, says an industry official.
• Travis Kavulla, NRG’s vice president for regulatory affairs, said the difference in performance had more to do with uncontrollable meteorological factors than anything else.
• The Feb. 1 storm froze turbines and caused available wind capacity to drop as low as approximately 1,600 MW out of a total installed capacity of almost 37 GW, according to the Electric Reliability Council of Texas’s fuel mix tracker.

Dive Insight:

In comparison to the Feb. 1 storm, Kavulla said, December’s winter storm Elliott initially arrived in Texas with significant wind and little precipitation, allowing wind turbines to produce great amounts of energy while many gas and coal power plants failed.

State senator Tan Parker, R, Tweeted a photo of ERCOT’s data on Feb. 2 and said, “Texas can’t thrive on a wind and solar-only energy future. When we need it most, wind and solar can't deliver enough to make a significant difference. Oil and gas will continue to be the main energy source for our state and nation for the foreseeable future.”

When asked about how wind’s performance on Feb. 1 was politicized by opponents of renewable energy, while its performance in December was politicized by proponents, Kavulla said, "That's definitely the emanation that I perceive in the rhetoric, and to your point, it's an unfortunate one."

“Elliott showed up in Texas with lots of wind and very little precipitation,” he said. “The wind showed up in grand fashion, and if it had not been there, there would have been blackouts. That emphasizes the need for a robust resource adequacy scheme in Texas, which it does not currently have, because it's not wise to rely on wind like the system was doing on Dec. 22.”

In comparison, wind didn’t “perform much at all” during the Feb. 1 storm due to freezeups, Kavulla said. “From wind, little reliability was promised, and it has delivered to expectations.”

“Renewables are capable of producing a lot of cheap energy during a lot of hours a year, so the presence of renewables has generally been a good thing,” he said. “But it also means that there's an important corollary – that more attention needs to be paid to making sure your overall system is resource adequate for these events when renewables don't show up.”

Elise Caplan, the American Council on Renewable Energy’s vice president of regulatory affairs, said in a statement the Feb. 1 outages in Texas could be blamed on “outdated grid infrastructure” and an isolated grid within the region.

“Renewable energy projects have generally proven less susceptible to the impacts of weather extremes than fossil-fired or nuclear power plants – and of course are critical to any serious effort to reduce the frequency and severity of these climate change-induced occurrences,” she said. “To ensure a more reliable power supply, we need to invest in more interregional transmission so electricity can be easily moved from where it’s generated to where it’s needed.”

Caplan also said increased use of renewable energy is key to decarbonization, which would reduce the frequency and severity of extreme weather events.

Kavulla believes the problem is nationwide and not specific to Texas, and a regional energy marketplace that capably handles reliability has yet to emerge.

“Even in marketplaces like PJM, which has a very robust capacity market with a significant reserve margin over a wide area with a lot of resource diversity, we did not see it perform to expectations during winter storm Elliott,” he said. “There were a lot of power plant freeze-ups, and the gas and electric industry did not coordinate well.”

Texas has realized that a “freewheeling” market won’t adequately reflect the demand associated with severe weather events, requiring a market structure that takes reliability into account, Kavulla said. 

He said that the state’s regulators are letting the market “evaluate, assess and value for reliability contributions from those different resources,” and not demanding certain amounts of generation from different sources. However, they are also working to establish reliability standards for demand peaks that those resources can aim to meet. 

On Jan. 20, the Public Utility Commission of Texas voted to adopt an energy market overhaul that uses a Performance Credit Mechanism, or PCM, to allow generators in ERCOT to earn credits based on their availability during the state’s greatest hours of need.

This overhaul is supported by Gov. Greg Abbott, R, but received criticism from the Texas Oil & Gas Association about the PCM’s ability to “maintain a market-driven system” as well as criticism from groups like the Sierra Club, which is concerned that the model will “provide extra money to long-standing fossil fuel generators.”

Kavulla said he believes the state’s approach could ultimately provide a good compromise between a “chaotic and freewheeling” market and a “highly centrally planned” market, “where you're hoping that government administrators or RTO administrators, or monopoly utility administrators, are able to correctly guess every essential variable.”

“To me, that central planning, while it has some appeal, also means that there are single points of failure,” he said. “If the monopoly doesn't do a good job, then it's game over.”