Texas grid sets June power record, urges conservation

Reuters News
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Posted: Jun 25, 2012 1:17 PM

HOUSTON (Reuters) - Texas power use peaked on Monday afternoon at a higher level than in any previous June even as the state urged consumers to limit appliance use to avoid straining power plants, as much of the state broiled under triple-digit temperatures.

Power demand reached 65,047 megawatts in the hour between 4 p.m. and 5 p.m. CDT (2200 GMT), surpassing the June record of 63,102 MW set last year, according to preliminary grid data.

Real-time power prices briefly exceeded $100 per megawatt-hour Monday afternoon and next-day power prices in the state traded between $165 and $175 per megawatt-hour, down several dollars from Monday's trades.

The extreme heat hit Sunday when the mercury hit 100 degrees Fahrenheit (38 Celsius) in Houston, San Antonio and Dallas, the three biggest cities in the Lone Star State, prompting residents to crank up air conditioners. Triple-digit highs are forecast for several more days this week, with some high enough to set records, AccuWeather.com forecast.

The Electric Reliability Council of Texas (ERCOT), the grid operator for most of Texas, said in a release it was looking closely at anticipated electric use and available generation.

ERCOT said demand may top 66,000 MW on Tuesday. The state's all-time peak use of 68,379 MW was set in August of last summer during a protracted heat wave and drought.

The grid agency said adequate generation resources should be available to serve that load without activating emergency programs that could lead to curtailment of power to certain industrial customers or broader rolling outages.

The grid operator said its plan for the week takes into account current power-plant outages and the possibility of losing additional resources.

One megawatt is enough to serve about 200 Texas homes during hot weather when air conditioners run for extended periods.

The grid agency has projected that power use will peak at 67,492 MW this summer, about 1,300 MW above what would be expected in a normal weather scenario.

ERCOT warned that rolling outages could occur this summer given the state's limited amount of surplus generation.

An extended heat wave and drought last summer forced ERCOT to declare emergencies on six days and curtail power to interruptible customers on two days in August to avoid widespread rolling outages.

The state's shrinking reserve margin has led regulators to implement a number of wholesale market changes to encourage construction of new power plants over the long-term.

Several idled power plants have been returned to service to bolster the summer supply after a new coal-fired plant expected to be operational was delayed.

NRG Energy, the state's second-largest power company, has more generation available this summer than last, after restarting a half dozen older, natural gas-fired units totaling 1,100 MW that were previously in mothball status.

"We have invested significant capital to get our units ready during spring outages," said Mauricio Gutierrez, NRG's chief operating officer.

Luminant, the state's largest generator, said its power plants have undergone preventative maintenance, inspections and testing to be available when called on this summer.

"We take our role of powering Texas very seriously and as such, we began preparing for the hot Texas summer months ago," said a Luminant spokeswoman.

The biggest transmission and generation companies in ERCOT include Luminant and Oncor, units of privately held Energy Future Holdings, CenterPoint Energy, American Electric Power, PNM Resources, NRG Energy, Exelon, NextEra Energy and Calpine Corp.

(Reporting by Eileen O'Grady in Houston and Scott DiSavino in New York; editing by Sofina Mirza-Reid, David Gregorio, Jim Marshall and Bob Burgdorfer)