Our update today is much the same. ERCOT mandated outages are still ongoing. All outages are considered mandated at this time.
We’ve been hearing a lot of questions and confusion about what’s happening to the grid in Texas, and why it affects our local co-op. We’re going to try to better explain the electricity market in Texas, and why these outages are now happening across the state. This post is long, but if you read through it, we think it will answer a lot of your questions.
SPEC is a distribution cooperative. We’re a local company that delivers power to 7,625 members and maintains the distribution lines that serve the homes and businesses within our service area. We are governed by members just like you – our board of directors. Our employees also live in the local area, and many are members of our co-op. Just like you, our board members and employees are experiencing these mandated outages.
SPEC purchases electricity from South Texas Electric Cooperative. STEC is a generation and transmission cooperative. That means they make electricity and deliver it to their substations within our local distribution network through transmission lines. They also maintain those facilities. Although we purchase enough electricity to provide adequate power supply for our members, it does not matter to ERCOT when the Texas grid is in a state of emergency.
The power lines from local distribution companies like ours and transmission lines around the state make up what is commonly called “the grid”. There are three grids in the United States, one of which is entirely in Texas, with limited connections to the rest of the United States. Our grid has been significantly impacted because of the extreme weather that has hit the entire state—something that’s pretty unprecedented.
The Electricity Reliability Council of Texas manages the grid within the state. It is overseen by the Public Utilities Commission of Texas and the state legislature. They control the flow of power by operating a market where all electricity is bought and sold within the state. All power, regardless of who is generating it, flows through this market. More importantly, ERCOT is tasked with making sure the electric grid is reliable.
Unfortunately, legislation has heavily subsidized renewable energy resources. While these generation sources are certainly valuable, they also aren’t reliable. The wind doesn’t always blow and the sun doesn’t always shine. We have seen tons of renewable generation come online in Texas. But because it’s not profitable to build baseload power – like a natural gas power plan—there isn’t really any other new reliable generation being build. In fact, STEC is one of the only generation providers who has added new baseload generation in the last few years. They built their Red Gate natural gas facility in 2016. In that time span, many other power plants in Texas have closed.
We’ve been voicing our concerns about these issues to Texas legislators for years. And we’ve routinely shared our concerns about the reliability of the grid with our members in Texas Co-op Power. We typically worry about the risk of mandated outages in peak summer months. In fact, ERCOT got pretty close to issuing rotating outages in August of 2019. At that time, it wasn’t windy and wind turbines largely stopped producing electricity on an extremely hot day when demand was high.
So what has happened to cause these outages to happen in the winter?
The simple answer is that there isn’t enough electricity being made. More than 70 generating units across the state have tripped offline due to unprecedented sub-freezing conditions across the entire state. These generation issues span across all types of electricity generation. Until these facilities thaw and can begin making power again, we will experience mandated outages. Right now, the state is short electricity for millions of people.
The lack of electricity is also coupled with record-breaking electricity demand in the state. With the entire state falling below freezing, the load from heating and everything else is much higher than Texas typically experiences this time of year. This is not something ERCOT anticipated when modeling how much electricity they would need through the winter months.
ERCOT, in their role to keep the grid reliable, cannot let the demand for electricity be greater than the supply of power available. If that was to happen, the state would experience a statewide blackout. It could damage the grid to the point of a rebuild. Instead of an uncomfortable few days without power, we could experience an uncomfortable few weeks.
To prevent that from happening, ERCOT has issued these mandated outages. All utilities in the state have to comply.
Why is SPEC not in control of these mandated outages?
ERCOT has directed STEC (and all utilities across the state) to reduce a certain amount of load from its system to keep the entire state grid operational. STEC controls these outages directly by turning power on and off at their substations. These outages were supposed to rotate, but that effort has been hindered by ERCOT’s increasing load shed requirements. Instead of rotating loads, STEC is often required to drop even more load, which is why these outages have been lasting so long. They also can’t rotate load back on without having another circuit equal in load size to remove from the system. Some of our larger circuits have dealt with unfairly long outages because of this. We have had regular contact and are actively working with STEC to improve this process as much as possible for our members.
Lastly, we just want to say that we care about our members. We are deeply sorry that you are experiencing hardship. We know you’re cold. We know there are elderly, children, people with medical needs, pets, livestock and more that live on our lines. If we could just give you power, we would! Unfortunately, there just isn’t electricity available. We can only ask that you please continue to bear with us through this difficult time. We are all in this together.