Can more solar help Texas meet peak demand?

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It was hot yesterday in Texas. Really hot; 105 in Austin and San Antonio, with a heat index that made it feel much worse than that. And with the state’s economy and air conditioners buzzing away, demand on the electric grid hit a new all-time high of 74.5 GW between four and five PM, a fact noted the the Electric Reliability Council of Texas (ERCOT).

This was both 1 GW higher than the all-time record set last summer and above the state’s forecast for the day, and fairly close to the 78.9 GW of total generation capacity (including reserves) that the state identified in May as being available this summer.

But while ERCOT was expecting something like this to come, it still sent wholesale power prices shooting up above $7,500 per megawatt-hour, before even 3 PM.

This was a test of Texas’ power system, which has no capacity market and is characterized by slim reserve margins. Earlier this spring, ERCOT identified that the system might need to enter an emergency status in order to keep the lights on.

And while Texas passed this test, with no widespread reports of power outages, it remains to be seen what next summer will bring.

 

Can solar meet the peak?

One resource that could help to meet this peak demand is solar, particularly when paired with energy storage. But given its size, wealth of cheap land and ample sun, Texas has less solar than you would expect. ERCOT’s summer resource adequacy report, published in May, identified less than 1.9 GW of utility-scale solar.

There is also a question of how much solar is able to meet these peaks, which come well after the mid-day peak of solar generation. In San Angelo, Texas, which is around the geographical mid-point of the western half of the state, the sun didn’t set until around 8:30 PM yesterday, but that doesn’t mean that solar projects – particularly those on rooftops and fixed-tilt racking – are at full output.

ERCOT gives a peak average capacity percentage of 74% for large-scale solar, meaning that it expects solar to have an average generation of around 3/4 of its rated capacity at the time of peak demand. But one of the challenges here is that these peaks typically run for several hours. ERCOT’s total demand yesterday was more than 70 GW until 8 PM, and didn’t fall below 60 GW until around 11 PM.

Solar paired with four-hour lithium-ion batteries could neatly meet this peak evening need, including after the sun goes down. And this is not theory; the Hawaiian island of Kaua’i is doing exactly this with large-scale solar paired with batteries, and the rest of Hawaii has followed suit – procuring 247 MW of solar projects backed with 998 megawatt-hour of battery storage. Notably, these all came in with bids of under 10 cents per kilowatt-hour.

 

The queue

If Texas doesn’t yet have as much solar as it could use, it is farther behind on batteries. The same May report which showed the 1.86 GW of solar also showed only 86.5 MW of batteries, and the state’s laws around ownership of battery storage could be an issue here.

There is a truly awesome amount of solar on the way in Texas, with ERCOT’s July interconnection report showing 62 GW of solar projects. And while given the highly speculative nature of project development most of those will likely not be built, there are nearly 9 GW of projects that have interconnection agreements, including 3.2 GW that have a full interconnection study completed.

Those projects that can secure financing and get built will come online over the next few years. It is difficult to say which ones will be online by next summer, but a June ERCOT report identified 1.3 GW of projects with interconnection agreements and financial security posted that are expected to come online later this year, a number which should grow as the year progresses.

Batteries are less promising; while there are nearly 4 GW of battery projects in the queue, none of these yet have interconnection agreements.

Nor do we know what the weather will be like next summer, but with increasing temperatures due to climate change, there is a good likelihood of Texas continuing to ramp up its peak demand as more and more air conditioners crank up to deal with the heat. It will be a race to get enough solar, and batteries, online in time.