Could Supreme Court Decision Impact ERCOT’s Reliability Needs? ERCOT latest report suggests not.

While there are a lot of what ifs, the recent Supreme Court decision to uphold the EPA’s Cross-State Air Pollutant Rule (CSAPR) at first glance could impact future generation and operating reserves in ERCOT, the Electric Reliability Council of Texas. In fact, back in 2011, in response to a request from the Texas Public Utility Commission, a preliminary analysis from ERCOT found that anywhere from 1,200 MWs to 6,000 MWs of Texas fossil fuel generation might be subject to closure or mothballing because of the impacts of the rules, putting Texas electric reliability at risk, especially at times of high demand or extreme temperatures. While the ERCOT preliminary analysis was admittedly rushed, and made some big assumptions,  it did suggest the timing of implementation of those 2011 proposed rules was going to be challenging for Texas at certain times of year. 

Well three years later, there is continued good news for development of more electric generation in Texas. Just a few days ago, ERCOT released its latest System Planning Monthly Report (March 2014), again showing there is a healthy interest in investing in Texas’s electric market. The report states that ERCOT is currently tracking 230 active generation interconnection requests totaling over 58,100 MWs of power. Again leading the way in these requests are wind — roughly 27,000 MWs in all — natural gas — at roughly the same — and solar — at some 3,300 MWs of power. In fact, the latest planning report shows that installed wind within ERCOT has already reached 11,065 MWs, and the expected amount of wind of those with signed interconnection agreements would reach 19,777 MWs by the end of 2017. 

Some are sure to paint doomsday scenarios where EPA rules — supported by the US Supreme Court — send Texas into a spiraling electric reliability crunch. Those poor coal plants just can’t meet those pollution rules and stay open they will say. While there will be challenges, and there is a need to support strong ancillary services like demand response to keep the lights on, expected investments in both gas, but especially in wind and solar, should keep Texas’ humming along economically. With implementation of CSAPR, we should also get some relief from all that coal pollution.