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Narrowing margin: Power outages show
shrinking surplus, prompt questions
Apr 19
- Knight Ridder/Tribune Business
News - Dan Piller Fort Worth
Star-Telegram, Texas
Despite 99-degree temperatures
Tuesday, the Metroplex and the rest
of Texas avoided a repeat of the
two-hour rolling electrical
blackouts caused by an overloaded
grid that cut power temporarily to
more than 600,000 North Texas homes
and businesses Monday.
But
state planners have plenty of reason
to worry about future electricity
needs.
The
state's surplus of electricity, a
robust 20 percent or more at the
beginning of this decade, is
expected to be no more than 11
percent by 2010 because of
population growth, the retirement or
mothballing of older plants and a
slowdown in the construction of new
generators, which marked the late
1990s.
The
margin during the peak electricity
use periods in summer
air-conditioning season will be even
narrower, according to estimates
from the operator of the state's
electricity grid.
"There
is really little time for debate in
Texas and in the rest of the
country," said Larry Makovich of
Cambridge Energy Research
Associates. "There exists a need for
more generating capacity by the end
of this decade to avoid serious
shortages."
Texas'
shortage Monday was brought by an
unexpected 101-degree day in April
that caused a huge draw on power for
air conditioners. That pushed demand
on the electricity grid from the
normal amount -- 38,000 to 40,000
megawatts -- to more than 52,000
megawatts on a day when 14,000
megawatts of Texas' generating
capacity was down for maintenance.
Utilities normally perform generator
maintenance in April, when mild
weather usually makes for their
lowest load levels of the year.
But on
Tuesday, TXU Electric Delivery got
its coal-fired, 800-megawatt
generator at Martin Lake near
Kilgore in East Texas back online
after having it down for several
days for maintenance. TXU also
postponed maintenance down times
that were supposed to begin Tuesday
for its Big Brown plant in Freestone
County and another plant near
Monticello in northeast Texas. Big
Brown and Monticello, both
coal-fired, together have a
generating capacity of 1,400
megawatts.
"We'll
keep Big Brown and Monticello on as
long as they're needed," said
Kimberly Morgan, a TXU spokeswoman.
Grid
regulators asked TXU to reduce its
load by 400 megawatts. It used
prearranged 15-minute blackouts that
crossed its system from Pittsburg,
in East Texas, through Dallas-Fort
Worth to Midland. The two-hour
period of rolling blackouts
ultimately affected more than
600,000 residences and businesses,
TXU said.
"The
idea is to speed the inconvenience
around in as short increments as
possible," said Carol Peters of TXU.
"What we don't want is to overload
the system and cause it to crash,
which then takes a long time to
restart. There was a serious danger
of that happening on Monday."
The
blackout Monday occurred on the
first day of the special session of
the Texas Legislature in Austin, and
politicians responded quickly.
"With
record temperatures this spring and
an unanticipated high demand for
electricity, it is disappointing for
Texans to be without electric
power," House Speaker Tom Craddick
said.
Sam
Jones, chief operating officer at
the Electric Reliability Council of
Texas, told state lawmakers Tuesday
that bad luck and bad weather -- not
inadequate reserves -- led to the
blackouts. "Several circumstances
came together -- it's very abnormal
for us to see four plants to [go
down], very abnormal -- I've only
seen it twice before," Jones told
lawmakers during a hearing of the
House Regulated Industries
Committee. "And it was a record
[high temperature] by many degrees."
He put
the state's electric reserve margin,
defined as generating capacity above
peak loads, at about 16 percent for
this year, which is above the
minimum safe margin, identified by
the PUC as 12.5 percent. However,
that's down from previous years. A
PUC spokesman has said margins were
as high as 20 percent three or four
years ago, leading one lawmaker to
question whether Texas has enough
capacity under the current market
system.
"If
you're telling people we have more
than adequate reserves, even if
plants go down, what does it mean to
have adequate reserves and still
have rolling blackouts?" state Rep.
Sylvester Turner, D-Houston, asked
Jones.
Public
Utility Commission Chairman Paul
Hudson said it's too early to know
what caused the blackouts or whether
there was any inappropriate "gaming"
by market participants. At the
height of the shortage, the price of
reserve wholesale power soared to
levels six to 10 times higher than
typical.
"It's
too early to draw conclusions,"
Hudson said. "We'll look at events
of yesterday both in terms of the
logistics of what happened and what
happened with regards to pricing.
It's our job to follow up on these
issues and make sure that it doesn't
happen again."
PUC
spokesman Terry Hadley said that
there was no initial evidence of
gaming but that "we've got staff
asking questions."
Local
customers of electricity providers
had their own doubts and questions.
"We
saw the same thing happening in
California," Mansfield resident Rod
Hill, who lived in San Jose during
the blackouts there in 2000-01, said
Tuesday. "When the first blackouts
occurred, we were told that plants
were being taken offline for
repairs. California deregulated its
electricity, and I'm concerned that
history is repeating itself in
Texas."
Jack
Morel of Arlington ridiculed the
notion that Monday's weather
surprised electricity planners.
"I
heard the forecast on Sunday
afternoon about the heat wave
coming, and I was smart enough to
put a bamboo curtain over my western
windows," Morel said. "If a little
guy like me could do that, then why
couldn't a big utility make some
adjustments, too?"
On
Tuesday, with temperatures at 99
degrees, the load on the state grid
again reached 52,000 megawatts, but
no appeals to the public or rolling
blackouts were needed. Even so,
state grid planners are working
under estimates showing that Texas'
margin between its electricity use
and its generating capacity during
the heaviest peak loads, which
normally occur during summer
air-conditioning months, is
narrowing.
"A new
plant takes four or five years to
build, and when you see that Texas'
reserve margins are likely to narrow
by the end of the decade, it makes
sense to take a look at new plants
starting now," TXU Chairman John
Wilder said last year when
announcing that the utility wants to
build a coal-fired generator in
Robertson County that would serve
the Dallas-Fort Worth grid.
That
plant and another coal-fired
generator proposed by San Antonio's
municipal utility are now going
through the permitting process with
state environmental regulators. TXU
says it hopes to have the new plant
in service by 2010.
TXU
depends on four coal-fired plants in
East and South-Central Texas for its
base-load generation, or plants that
operate round the clock. Those
plants provide about 5,200 megawatts
of the 18,000 megawatts needed for
the Dallas-Fort Worth market.
An
additional 2,300 megawatts comes
from TXU's nuclear plant at Glen
Rose. The rest comes from natural
gas-fired plants.
In
addition, the Dallas-Fort Worth
market is served by merchant
generating plants operated by Suez
Energy in Bridgeport, Midlothian and
Ennis; FPL, near Forney, east of
Dallas; and American Electric
Service, near Granbury.
In the
decade beginning in 1995, utilities
and independent generators built and
put online 70 generating plants in
Texas, all fueled by natural gas.
But the gas-fired generating boom
has run aground as natural gas costs
have at least tripled since the
beginning of this decade. The Suez
plant that opened near Bridgeport
last year is expected to be the last
new gas-fired plant in the
Dallas-Fort Worth area in the
foreseeable future.
-------------------------------------------------------------------------------------------------------------------------------------------------
Apr 18, 5:35 AM EDT
Hot Temperatures Force Blackouts in
Texas
By
STEVE QUINN
Associated
Press Writer
HOUSTON (AP) -- Faced with the
prospect of another day of
record heat, the state's power
suppliers urged Texans to cut
down on their electricity use in
the hopes of avoiding more
rolling blackouts.
Power companies throughout the
state imposed the blackouts
Monday because of an electricity
shortage during unseasonably hot
weather. Thousands of people
were caught without electricity
for short periods of time as
highs reached into the low 100s,
and police rushed to direct
traffic during the afternoon
rush hour.
Highs were expected to reach
into the upper 90s on Tuesday
before returning to a more
normal range in the 70s and 80s
on Wednesday.
"We are asking everybody to
pitch in and do the best they
can by minimizing electric
consumption between 3 p.m. and 7
p.m., the peak hours," said Paul
Wattles, spokesman for Electric
Reliability Council of Texas,
which runs the state's
electricity grid.
As
much as 15 percent of the
state's power supply was already
off line for seasonal
maintenance to brace for the
summer's energy usage peaks, but
four power generating plants
also shut down unexpectedly,
Wattles said. Officials were
pushing to get power flowing
again from the generators that
had been idled.
ERCOT said operations were back
to normal by Monday evening.
The typical usage for Texas in
April is about 40,000 megawatts
a day, but the state pushed
52,000 megawatts on Monday,
Wattles said. The rollouts were
limited to the ERCOT grid, which
provides electricity to about 80
percent of the state.
A
recorded high of 101 degrees at
Dallas-Fort Worth International
Airport broke the previous high
of 94, set in 1913 and matched
in 1925, according to the
National Weather Service.
Temperatures reached 107 degrees
in Laredo.
The
rolling blackouts, which lasted for
a little more than two hours, were
the first in the ERCOT region since
Dec. 22, 1989, during a winter ice
storm.
------------------------------------------------------------------------------------------------------------------------------------------------
Perryman Group Study Confirms Huge Benefits of Texas
Electric Competition; Cites Rate Savings
WACO, Texas, April 13, 2006 /PRNewswire
A new study by The Perryman Group on the impact of
cost savings from retail electric competition on
business activity indicates an annual stimulus to
the Texas economy of some $9.73 billion in total
expenditures, $4.64 billion in gross product, and
almost 47,800 permanent jobs. To put these numbers
in perspective, the annual benefit of electric
competition to Texas employment is more than five
times the economic impact of the first phase of the
Toyota manufacturing plant in San Antonio set to
open later this year and more than 10 times that of
the new Texas Instruments 300mm wafer fabrication
facility.
Ray Perryman, economist and president of the
economic research and analysis firm based in Waco,
said, "Numerous innovations have been introduced and
prices are lower than they would have been in a
regulated environment. Market forces are having the
desired effects of providing consumers with more
control and more choices at prices lower than they
would have been under regulation."
Cost savings from four years of healthy competition
has led to advances in many economic areas, the
study said. For example:
Regarding natural gas prices, Perryman said, "Some
commentators have suggested that the increase in
prices in Texas indicates a lack of success of the
competitive mechanisms. This assertion is simply
wrong. Electric rates have always varied across
areas depending on fuel costs, capital costs, and
other factors."
"The pertinent issues are whether prices are lower
and choices are greater than they would have been in
the absence of competition. By that standard, Texas
has by far the most successful program in the United
States."
The study noted that natural gas prices for the
electric power sector have risen 268 percent since
2002. During the same period, the weighted average
residential electricity Price to Beat has risen by
about 85 percent, while the corresponding lowest
competitive offer has risen by 69 percent.
Texas continues to be widely recognized as the
healthiest and most successful market for retail
electricity in the United States and, in fact, one
of the best in the world, the study observed.
The study concludes, "An adequate and affordable
supply of electric power is essential to current and
future prosperity. Since the introduction of
competition in the retail segment of the market for
electric power, Texans have enjoyed substantial
savings compared to likely rates in a regulated
environment."
"Moreover, investments in generation facilities have
helped ensure additions to capacity that will help
to serve the needs of a growing population and
economy."
CONTACT: Dr. Eugene Baker, 254.751.9595
SOURCE The Perryman Group
------------------------------------------------------------------------------------------------------------------------------------------------
News Update: TXU Electric Delivery
April 10, 2006
Demand Reset with New Customer Move In
Effective April 28, 2006, TXU Electric
Delivery will reset the demand ratchet
on an existing premise for a new
customer moving in. A move – in transaction on an existing
premise completed on or after this date
will trigger a demand ratchet reset to
“0”.
The demand ratchet will NOT be
reset with a customer name change
transaction, when a move in transaction
is received for the existing customer
following a disconnect for non pay, or
when the customer switches to a
different competitive retailer.
Premises being invoiced for periods
prior to the April 28, 2006 effective
date of this change will continue to be
billed using the historical demand
ratchet for this premise.
This change in practice is being
implemented for the following reasons:
New customers moving into an existing
premise will have the opportunity to
establish their own demand for billing
purposes regardless of the previous
customer’s demand.
This change will allow TXU Electric
Delivery to move toward more
standardization of practices between
Transmission and Distribution Service
Providers within the Competitive
Electric Market in Texas.
------------------------------------------------------------------------------------------------------------------------------------------------
Thursday, December 1, 2005
-- The
Public Utility Commission (PUC) on
Thursday approved an extension of its
emergency rules to continue providing
deposit waivers for both Hurricane
Katrina and Rita victims when applying
for new basic local telephone and
electric service in Texas.
The waivers are good for 60 days and are
designed to make it easier for hurricane
victims to establish a new residence.
Some Texas providers already have
voluntarily waived deposit requirements
and eliminated installation fees.
The rules were set to expire on Dec. 2,
2005. Thursday’s action extends the
rules until Jan. 29, 2006.
The PUC does not have the authority to
waive deposit requirements for customers
of municipal electric utilities and
electric cooperatives, but the
Commission encourages these entities to
authorize such waivers.
http://www.puc.state.tx.us
------------------------------------------------------------------------------------------------------------------------------------------------
Tuesday, March 15, 2005
-- Texas is expected
to meet a 2009 mandate three years early
by sharply increasing the use of
renewable energy to generate
electricity.
The Texas electric restructuring law of
1999 required an additional 2,000
megawatts of renewable generating
capacity in Texas by 2009. Developers
have added 1,190 megawatts on-line since
the law was passed, and projects adding
486 megawatts are either under
construction or have been officially
announced. Transmission agreements have
been finalized for another 720
megawatts. Developers are expected to
push hard to get new projects on-line by
Dec. 31 because federal renewable energy
tax incentives expire at the end of this
year.
Renewable energy uses several sources,
including wind, landfill gas, water
(hydro), biomass and solar. In Texas,
wind power currently accounts for 96
percent of renewable generating capacity
added since 1999.
Approximately three percent of the
state's total electric generating
capacity comes from renewable energy. In
Texas, a megawatt provides enough
electricity for a year to power three to
four hundred homes.
http://www.puc.state.tx.us
-----------------------------------------------------------------------------------------------------------------------------------------------
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