Texas grid sees load growth, no sign of oil slump

OREANDA-NEWS. The Electric Reliability Council of Texas (ERCOT) expects power demand to reach record highs this spring as oil and gas activity has yet to slow despite a slump in prices.

The months of March, April and May typically bring the lowest power consumption in Texas although above-normal temperatures in late May can spur early air-conditioning load and high electric demand.

ERCOT said spring demand could peak at 61,957MW in late May, which is 3,000MW, or 5pc, above the all-time May record set in 2012. The spring outlook is based on normal Texas weather conditions from 2002 to 2013.

Strong power demand from oil and gas exploration and production activity across the state has yet to drop despite a 50pc decline in oil prices since last June, grid officials said. ?ERCOT expects to have 76,619MW of generation on hand to serve spring load, a 27pc surplus.

Many power plant owners perform annual maintenance during the spring which can cause supply issues.

NRG Energy plans to upgrade environmental controls at six coal-fired units this spring, totaling 4,200MW. The 1,250MW unit 2 at the South Texas Project nuclear plant is also scheduled to shut for about a month to refuel this spring.

ERCOT does not control power-plant maintenance schedules, but "there is significant market incentive to bring plants back on line" before late May, ERCOT director of system planning Warren Lasher said.

A 400MW gas-fired plant, owned by Brazos Electric Cooperative, recently went on an extended outage due to a lack of cooling water.

Statewide drought conditions have lessened, but some areas remain in extreme drought, ERCOT officials said, and they continue to watch reservoir levels.

ERCOT's spring assessment includes several changes from last year. New calculations for wind capacity, along with more wind turbines, added nearly 1,700MW of wind to the 2015 outlook compared with a year earlier. Excluding wind, installed resources fell by 937MW despite new gas-fired generation placed into service last summer.

ERCOT's demand forecast is 9pc higher than the 2014 forecast peak of 56,677MW, but the 2014 projection was based on a cooler-than-normal weather forecast rather than normal weather. Actual demand in the second quarter of 2014 peaked in March at just 54,548MW, a monthly record.

The grid agency also has revised how it forecasts power demand since the 2014 report, paring annual growth in peak demand.

ERCOT meteorologist Chris Coleman expects mostly normal spring temperatures this year. While colder-than-normal temperatures seen in January and February may spill into March, Coleman said the potential exists for warmer temperatures from mid-to-late spring.

"Expect temperatures to average near normal for the majority of Texas this spring," Coleman said, with most of the state more likely to see dry conditions than above-normal precipitation.

Cold January temperatures pushed ERCOT demand 7pc above the grid's winter forecast. But wholesale power prices in winter fell below the year-earlier levels, as natural gas prices have slumped.