Texas suffered a huge failure his electrical system in the past week, after the state was hit by a devastating one winter StormLast Tuesday evening, 4 million electricity customers had lost power, almost a third of the total users of 12.4 million. Most of those customers have regained power, but the partial power outage lasted several days and the winter season is not over yet. This article discusses the reasons for the Texas power outage, including interruptions in natural gas supplies; generation units that couldn’t bear the cold; the lack of generation capacity requirements or a capacity market in Texas; and the isolation of Texas from other network systems U.S that could have provided additional electricity.
The power outage occurred in the area served by the Electric Reliability Council of Texas, or ERCOT, which covers most of Texas. ERCOT is an “independent grid operator” that manages the electricity grid and is responsible for matching the supply and demand of electricity within its catchment area. ERCOT does not generate electricity itself, but gives instructions to energy producers about how much electricity is needed to meet the demand for electricity. The problem arose when electricity demand skyrocketed on Monday, February 15, due to severe cold, and ERCOT was unable to find enough power production to meet that demand.
According to ERCOT, “extreme weather conditions caused many production units, of all types of fuel, to go offline and become unavailable.” That is why ERCOT announced emergency situations on February 15 and initiated alternating power outages, that is, shutting down the power supply to groups of different customers for short periods. However, as more and more production units went offline, the temporary power cuts turned into a power loss over large areas for extended periods. So for what reason did this happen?
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A more significant problem were interruptions in the supply of natural gas from Texas. In 2020, natural gas provided the most electricity of all fuel sources: 45.5% of electricity in Texas came from natural gas, 22.8% from wind, 17.9% from coal, 10.9% from electricity, nuclear and 2, 9% from other sources. But because of the freeze, there was not enough natural gas available to supply power plants with the constant pressure they need. Dan Woodfin, ERCOT’s senior director of systems management, stated on February 16, 2021, “It appears that much of the generation disconnected today is mainly due to problems in the natural gas system.” The reasons included competition with other users, including residential users, who needed the gas for heating; frozen gas wells, pipes and valves; and frozen processing equipment.
Another major problem was the insufficient protection of the generating installations against the cold. Many conservative commentators in the United States blamed frozen wind projects for the energy crisis. It should be noted that ERCOT’s seasonal planning is based on this type of energy for only 7% of the total electricity supply from December 2020 to February 2021, although wind projects provide much more electricity in other parts of the year. Some wind projects They freeze last week due to a lack of ice capacity used in cold weather wind projects, but they continued to operate long enough to get close to winter forecast numbers. The power plants the use of gas, coal and nuclear energy, which were expected to provide much more electricity in the winter months, also suffered from the cold, such as instrumentation systems freezing.
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Texas also suffered from the lack of capacity requirements or a capacity market, which provide for mandates or payments to power producers to have generation sources ready for use, even if those resources are not currently being used. Most jurisdictions in the United States have these requirements or markets that provide an insurance policy in terms of adequacy of resources. But not ERCOT. Instead, it lets prices float freely, on the assumption that the possibility of extremely high prices is a sufficient incentive for energy producers to build capacity. The problem is that these price increases can be very expensive for electricity consumers. Many analysts believe that floating prices are an ineffective strategy compared to capacity requirements or markets to ensure that there are sufficient resources.
Finally, Texas is not connected to the two major grids in the rest of the United States that could have provided supplemental electricity when Texas faced insufficient generation. This was a conscious decision by the Texas government, as interconnection with the other US networks would have given the US federal government regulatory authority over ERCOT and its network. Texas is adamant to avoid federal regulation. In fact, former Texas Governor Rick Perry believes Texans are willing to have power outages lasting more than 3 days rather than accept federal regulations. Former Gov. Perry’s comments were greeted with outrage by his political opponents, as the suffering and likely deaths from the failure of the Texas electrical system could have been avoided had Texas been connected to the other US grids.
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What happens now? The Governor of Texas, Greg Abbott, has already requested that ERCOT be investigated. At the same time, he admitted that, as governor, he has responsibility for the proper functioning of ERCOT and has promised reforms.
As for the reasons for the power outage, the Texas legislature is now likely to require new protections for the electrical system and gas supply system against cold weather. However, those protections are expensive and there will certainly be a discussion about who should pay. Following an earlier Texas freeze in 2011, a report from the US Federal Energy Regulatory Commission (FERC) and the North American Electrical Reliability Corporation (NERC) warned that more protection from cold weather was needed. But ERCOT could not make such protections mandatory and the FERC / NERC warning was largely ignored. With increased volatility in weather patterns, the severity of the storm just hitting, and growing political backlash against Texas political leaders, this state is likely to take more aggressive action this time.
As for the market’s requirements for capacity and Texas’s interconnection with the other networks in the United States, there will certainly be intense debate as to how to proceed. The failure of the Texas electricity system will put pressure on Texas to judge whether it is time for a change of course on these issues, but it is too early to say how the debate will unfold.
John McNeece is a Senior Fellow of Energy and Commerce at the Center for United States-Mexico Studies at the University of California, San Diego. You can be contacted by email at [email protected]