Texas notches fourth straight day of $1bn+ electricity market costs, calls for energy conservation
ERCOT calls for energy conservation
For the fourth day in a row, ERCOT has issued an advisory for projected reserve capacity shortages and called for energy conservation where safe. Rotating outages remain unlikely without significant deviations from ERCOT’s forecast.
ERCOT weathered extreme heat and waning reserves again yesterday, with calls for electricity conservation and an unexpected pickup in wind generation helping the grid through a trying afternoon and evening.
Online reserves (white line in the chart below) bottomed out around 5,600MW at 8pm. Emergency conditions are triggered when reserves fall below 2,300MW without expectations of quick recovery.
A $1bn Sunday in the Texas electricity market
Day-ahead prices for today again reflect expectations for tight operating reserves, with prices clearing above $2,000/MWh from HE17-20. The highest prices are again leaning later in the evening when demand drops slightly but solar vanishes from the supply stack.
ERCOT’s day-ahead energy market has cleared well north of $2bn just this weekend, before accounting for gigawatts of ancillaries, adding to the tab of historic wholesale market costs this month.
August 2023 will be ERCOT’s most expensive summer month ever, with wholesale electricity prices on track to settle at their highest levels in the market’s history outside of February 2021 (Winter Storm Uri). A rough initial low-end estimate, before accounting for billions more in ancillary service costs, puts the tab at greater than $14bn.
Texas remains primed for tight grid conditions and wholesale power price eruptions. Demand in ERCOT is forecast to stay near extreme levels, while afternoon and evening wind will continue to fall near summer lows—the perfect recipe for tight grid conditions and power price eruptions.
Thanks for this informative post.
It looks like a similar trend in all countries with a high share of renewables and limited flexible capacity.
I wrote an article about the volatility in day-ahead markets (even if less extreme in the EU for the moment).
https://gemenergyanalytics.substack.com/p/volatility-a-new-normal-in-day-ahead
The problem of over-reliance on unreliable, nondispatchable energy sources persists. The ERCOT day-ahead market peaks at close to $1,000.00 / MWh at 7:00 PM CDT on Monday, August 28. More evidence of the value of a grid like France's which is mostly a nuclear-powered grid.