Efficiency in ramping up, down important for renewables-heavy Texas grid: exec

A new $7.2-billion financing program to expand resources in the Electric Reliability Council of Texas emphasizes dispatchability, but a Wartsila executive emphasizes the importance of efficiently ramping up and down to accommodate increasing intermittent renewable penetration.

On Nov. 7, Texas voters approved a constitutional amendment authorizing the creation of the Texas Energy Fund to provide low-interest financing to expand dispatchable resources by as much as 10 GW.

The Public Utility Commission of Texas is in the process of developing rules to implement Senate Bill 2627, which called for establishing the Texas Energy Fund (Project. No. 55826).

The law authorizes loans and grants in the following categories for expansion of 100 MW or more of dispatchable power, excluding batteries, for up to $7.2 billion to be located within the ERCOT service area, which serves about 90% of Texas load.

The PUC plans to begin accepting loan applications by June 1 and start distributing funds by Dec. 31, 2025. Organizations such as the Lower Colorado River Authority and Calpine have committed to placing new generation in service by June 2025 and June 2026, respectively, in order to obtain significant early completion bonuses.

Flexibility is needed

However, Karl Meeusen, director of Wartsila North America's markets, legislative and regulatory policy, said "steel in the ground" is not as important as the flexibility of such resources.

Wartsila, a Helsinki, Finland-based producer of power generation with North American headquarters in Houston, has more than 1 GW of such resources in Texas – 850 MW of engine power and 200 MW of battery energy storage systems.

"It's not anymore just about what's happening, at peak," Meeusen said in a recent interview. "It's about what you're able to do, during netload peak, what you're able to do when there's variability on the system, and how you're able to respond to those more specific events, as opposed to that two o'clock in the afternoon on an August weekday."

In the past, resources were considered reliable if they could operate 8,760 hours a year, but "I think what we're still lacking is how we're doing in 8,760 times 12, which is to say every five-minute interval," Meeusen said.

And the key question is not so much whether capacity is available, but whether it's "functionally available, meaning it can ramp to where it's needed to help support the variability of the system," Meeusen said.

Reciprocating internal combustion engines such as Wartsila's products allow quick upward and downward ramping capability – what he called "mileage" at heat rates around 8 MMBtu/MWh, whereas gas turbine peakers often have heat rates in excess of 10 MMBtu/MWh.

"How much do you need me to move to balance the system out?" Meeusen said. "So for example, if I have a resource and a ramp from zero to 100 MW then back down, I provide 200 MW of mileage. ... I can find an example from Texas where if you look from hour to hour, it looks like the absolute change is about 50 MW or 75 MW, but then when you look within the hour, it's actually 800 MW of total movement up and down, up and down every five minutes."

Minimizing opportunity cost

In a system with large amounts of intermittent renewable resources, such as ERCOT with 38.8 GW of wind and 22.3 GW of solar as of the end of January, curtailing renewables could incur an opportunity cost that RICE resources could minimize, he said.

"In that context, what do you need to do to balance the system?" Meeusen said. "And the answer is, you need to move. If you can't, you're going to end up curtailing low-cost generation to continue with inflexible higher-cost generation which is say curtailing free renewables to continue producing something that requires fuel input."

Wartsila is discussing the possibility of supplying resources for Texas Energy Fund projects, Meeusen said.

One advantage for Wartsila's engines is that they are "omnivores, which is to say, if you bring it, we can burn it," Meeusen said. Wartsila recently operated a generator on 25% hydrogen by volume on Michigan's Upper Peninsula, he said.

"We can run on natural gas, diesel, biodiesel, heavy fuel oil," Meeusen said. "We're doing blends with ammonia, with hydrogen and a variety of different fuel sources."

The Texas Gulf Coast is becoming a center for development of hydrogen and ammonia as alternative fuels.