Texas is grappling with another heatwave, with highs reaching 114 degrees, placing extreme pressure on a power grid that has come under scrutiny in recent years for its ability to handle increased demand, Rystad Energy analyst Ryan Kronk said in a market note sent to Rigzone late Wednesday.
In the note, Kronk highlighted that the Electricity Reliability Council of Texas (ERCOT) asked consumers to conserve energy on Monday in response to the extreme heat, “suggesting that rolling blackouts could be on the cards”. On Wednesday, ERCOT also issued a conservation appeal for between 2-9pm on July 13, asking Texans and businesses to voluntarily conserve electricity during that time. ERCOT warned in the appeal that extreme hot weather continued driving record power demand across the state.
“Consumers are feeling the hit, with power prices soaring to their highest levels since the record-breaking February 2021 freeze, at a time when air conditioning is essential for public safety,” Kronk said in the market note.
“As the rest of the summer looms on the horizon, these issues are not going away anytime soon. The most recent heat wave comes on the back of one of the hottest Junes ever in Texas. And the heat is not over; temperatures exceeding 100 degrees are expected to continue through this week,” Kronk added.
“To add insult to injury, the summer months have barely just started and higher temperatures are all but certain in late July and early August,” Kronk continued.
In the note, Kronk highlighted that the extreme heat also impacted wind power generation, which the analyst noted is a major source for Texas’ power grid.
“One of the U.S.’ fastest-growing states in terms of population, power demand in Texas is also increasing,” Kronk said in the note.
“The solitary nature of the Texas power grid, combined with the extreme weather of recent years is placing a lot of strain on the system,” Kronk added.
In defense of the Texan power sector, Kronk said a great deal is being done to rectify the situation, adding that Texas leads much of the country in new power plant installations, including in renewables.
In the long term, however, Kronk warned that Texas will need to invest in significant storage capacity or renewable fuels to have a climate-friendly and secure grid.
At the time of writing, ERCOT’s website shows that grid conditions are “normal” and states that “there is enough power for current demand”.
Source: Rigzone.com