ERCOT studies range of scenarios prior to summer, identifies low risk for outages

New, more extreme scenarios incorporated into seasonal assessments for holistic view

AUSTIN, TX, March 25, 2021 - Based on information provided by generation owners to the Electric Reliability Council of Texas (ERCOT), the grid operator anticipates there will be sufficient generation to meet the summer 2021 peak demand based on expected system conditions.

ERCOT today released its final Seasonal Assessment of Resource Adequacy (SARA) for the spring season (March - May) and its preliminary assessment for the summer season (June - September).

Preliminary Summer SARA

'ERCOT will benefit from growth in generation resources, but forecasts are also showing another record-breaking summer on the demand side,' said ERCOT's Vice President of Grid Planning and Operations Woody Rickerson. 'Overall, power reserves are in a better position heading into this summer compared to the past few years.'

ERCOT is traditionally a summer peaking region, and generators in Texas are typically built to maximize performance during hot weather conditions.

With continued economic growth across the state, ERCOT anticipates a summer 2021 peak demand of 77,144 MW, which would be a new system-wide peak demand record for the region. Based on the December Capacity, Demand and Reserves Report, the reserve margin is expected to reach 15.5% by summer, up from 12.6% in 2020 and just 8.6% in 2019.

ERCOT anticipates there will be nearly 87,000 MW of resource capacity available for summer peak, including 5,489 MW of planned summer-rated capacity (i.e., gas-fired, utility-scale solar and wind). Additionally, ERCOT expects to have 939 MW of operational battery storage resources, which includes 717 MW of planned additions. While some of these battery storage resources may help meet customer demand, they are not currently included in ERCOT's capacity contributions for summer.

One MW typically provides enough power for 200 homes on a hot summer day.

New Extreme Scenarios & EEA Reserve Capacity

In response to the unprecedented, extreme winter weather event in February that forced half of the generation in ERCOT to go offline, the grid operator has added a new section in the preliminary summer SARA that includes more extreme scenarios that could lead to energy emergencies and the possibility of controlled outages. These extreme scenarios consist of combinations of high system risk assumptions derived from historical data, and while there is a low probability that they will occur, they would be high-impact events.

'We recently experienced a terrible tragedy, and ERCOT is committed to working with legislators, regulators and stakeholders on how to prepare for more extreme outcomes moving forward,' said Rickerson. 'We must strike a balance between communicating the possibility of these types of conditions and providing realistic seasonal expectations.'

While there is always a risk of emergency conditions and outages, that risk increases based on a combination of factors, including record demand resulting from extreme temperatures, high thermal generation outages and low wind/solar output.

The preliminary summer SARA also shows the adjusted amount of reserve capacity expected to be available if ERCOT enters into emergency conditions. When ERCOT enters into an Energy Emergency Alert, or EEA, it has approximately 2,300 MW of additional resources that only become available when an EEA is declared by the grid operator.

Summer Preparations

Prior to summer, ERCOT and its Market Participants take additional steps to ensure system reliability can be maintained during tight conditions. Steps include:

• Coordination with Transmission Service Providers (TSPs) to limit planned outages during the summer months
• Request generators to contact gas suppliers to identify any pipeline activities that would affect the availability of gas for their generators during the summer season
• Communications coordination with Market Participants

The final summer SARA report will be released in early May and will reflect the expected summer weather conditions, including developing drought conditions in west and south Texas.

Final Spring SARA

Based on the spring SARA report, ERCOT anticipates there will be sufficient generation to meet system-wide demand under most of the extreme system conditions evaluated. The spring SARA includes a 64,448 MW spring peak load forecast.

Background on the SARA

The SARA report is based on an assessment of generation availability and expected peak demand conditions at the time it was prepared. The cutoff date for planned resources to be included in the spring SARA has changed from March 1 to April 1, and the cutoff date for the summer SARA has changed from June 1 to July 1. Additionally, the report now includes synchronized generation that may be producing power but has not yet been approved by ERCOT for commercial operations.

The assessment takes into account expected generation outages that typically occur during each season for maintenance, as well as a range of generation outage scenarios and weather conditions that could affect seasonal demand.

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