Interesting Things out of Texas

Image courtesy of ERCOT

Yesterday, Bloomberg had posted a brief article on wholesale electricity prices in ERCOT, noting near record high prices on Monday as a function of extreme heat, lighter wind speeds, and coal plant decommissioning. Yesterday morning around 8AM, ERCOT was projecting higher demand than available capacity, predicting another round of record prices and potential brown-outs. This morning, Bloomberg's follow-up piece noted that yesterday wholesale prices reached the $9000/MWh cap (employed by ERCOT to limit runaway pricing) for about five hours. According to ERCOT, they came within ~2100MW of their actual capacity. The last unit to come online was a retired coal plant that was brought back online in anticipation of this event. It may come as a surprise to many of us that wind makes up anywhere between 15-27% of ERCOT's electricity mix, a significant contribution from a renewable asset. The percentage contribution doesn't correlate with actual generation and depends on other factors. For example, in March, when wind contributed 22% of electricity mix, it generated 6045 GWhs, but in July, it generated 6146 GWhs which constituted only 15%.

Image courtesy of ERCOT

Overall, wind has been a been a viable renewable asset for Texas/nationwide but has also contributed to some inefficiencies in the market. It'll be interesting to see how ERCOT manages this moving forward; where investment dollars go regarding technology type.