Texas grid extends power conservation call as cold boosts usage, prices

March 3, 2014

(Reuters) – The Texas electric grid operator extended its call for residents and businesses to conserve power until Tuesday morning as a late arctic cold front that barreled as far as South Texas boosted the state's electricity consumption to a monthly record on Monday.

The Electric Reliability Council of Texas (ERCOT), the state's primary grid, had issued a public call for conservation on Sunday evening, citing freezing temperatures that would strain available generation capacity.

"With the continued cold weather, we expect conditions to remain tight, especially during the early evening tonight and early morning hours tomorrow," said Dan Woodfin, director of system operations for ERCOT.

"We have asked all available generation units to remain available, but we believe conservation by consumers also will be necessary to help maintain reliability during this cold March weather," said Woodfin.

Electricity usage in Texas has set peak-hour records in at least five of the past six months, according to ERCOT data.

Power demand early on Monday reached 54,549 megawatts in the hour ending at 8 a.m. CDT (1400 GMT), surpassing the 47,665 MW record set on Sunday evening as sub-freezing temperatures and high winds pushed deep into the state, according to the ERCOT website.

The previous March record use for ERCOT was 43,033 MW set in 2002. Monday's March peak is 27 percent above the March 2002 record.

The record autumn and winter power usage has come as regulators and some power plant owners disagree about whether Texas' $35 billion power market needs an overhaul to encourage construction of new power plants.

Last week, ERCOT issued its summer supply outlook after lowering expectations for peak power use in the years ahead.

ERCOT was able to avoid a repeat of the emergency steps taken in early January to prevent rolling outages.

Real-time power prices briefly hit the market cap of $5,000 per megawatt-hour in some areas during the early morning hours on Monday and averaged $2,700 per MWh for about one hour.

Prices also briefly hit $1,000 on Sunday evening as cold temperatures reached Houston and settled in.

The extreme winter weather has boosted power demand well above ERCOT's winter forecast of less than 50,000 MW under normal weather conditions.

ERCOT's winter peak remains 57,265 MW record set in February 2011 during a prolonged cold spell, according ERCOT spokeswoman Robbie Searcy.

Preliminary data showing a slightly higher peak of 57,277 MW on Jan. 7, has been revised downward to 57, 256 MW, Searcy said, still a peak for any January.

ERCOT's all-time peak use of 68,305 MW occurred in August 2011 during an extended heat wave and drought.

One megawatt can power about 500 homes during mild weather conditions and about 200 homes during high-demand summer months, ERCOT said.

Power producers in Texas include Luminant, a unit of privately held Energy Future Holdings, NRG Energy, Calpine Corp, NextEra Energy, Exelon Corp, LS Power and Panda Power Partners.

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