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ERCOT defends crisis response as investigations launch

SNL Image

An ice-covered Entergy natural gas plant in Texas during the Arctic storm that left millions of customers in the dark for days.
Source: Entergy Texas

Officials with the Electric Reliability Council Of Texas Inc. in a Feb. 24 emergency board meeting provided a blow-by-blow account of a disastrous week, defending the grid operator's performance during an unparalleled cold snap that shut down unprepared power plants, leading to blackouts that left millions without power and cost lives.

Bill Magness, president and CEO, said that ERCOT had prepared the grid for the Arctic blast, calling efforts by the grid operator's employees courageous in preventing a blackout that could have extended for weeks or months.

"As forecast, we saw this storm coming," Magness said.

The hours-long presentation during the emergency meeting will provide fodder for the various legislative and regulatory investigations into what occurred in the years, months and days leading up to one of the biggest energy crises in Texas history. In the wake of the incident, ERCOT's four independent board members resigned after Republican Gov. Greg Abbott called for accountability. On Feb. 25, lawmakers will begin their own probe.

"ERCOT must be overhauled," said Abbott during a televised address on the evening of Feb. 24.

Winter is coming

ERCOT officials said that as early as November its meteorologist issued a weather outlook noting a "very good" chance for extreme cold during the winter. At the same time, ERCOT predicted that its winter peak electricity demand would be roughly 57,600 MW. At the highest point of the power losses, on Feb. 15, 48% of ERCOT's generation, or 52,277 MW, went out of service. Without load shedding, in which the grid operator ordered generation offline to prevent the grid from going out of balance, the peak demand in ERCOT's system would have been 74,820 MW, smashing records.

In the call, ERCOT officials also highlighted the fact that lawmakers have given them no formal enforcement authority that would require generators and gas suppliers to protect their facilities against extreme weather, despite a similar but less severe 2011 cold snap that shut down natural gas plants, as a total of 29,729 MW of generation was forced offline during below-freezing temperatures.

Following that cold snap, the Texas Public Utilities Commission amended its rules to allow ERCOT to conduct spot checks to see if generators are prepared for all conditions. ERCOT officials said they check about 80 power plants a year, a fraction of the 680 power plants on its system. Officials said they try to target such visits to new power plants to ensure they are following best practices.

But for the most recent spot checks, ERCOT officials did not conduct actual site visits because of the COVID-19 pandemic, Leslie Sopko, a spokeswoman, said in an email.

"ERCOT does not own generation assets and has no authority to require generators to take any particular weatherization measures," Sopko said.

'We could not go lower'

On Feb. 3, ERCOT's meteorologist warned that Texas' coldest weather of the year was on the way. In the days leading up to the blackouts, ERCOT officials told transmission and distribution companies to reschedule repairs on 1,600 transmission devices. They updated load forecasts, including the likelihood of wind turbines icing up. The U.S. Department of Energy gave fossil fuel generators waivers to exceed emissions caps during the freeze, and about 25 natural gas and five fuel oil generators took advantage of it, adding nearly 1,200 MW to the grid.

On the morning of Sunday, Feb. 14, as temperatures plummeted and demand soared, ERCOT appealed to the public to conserve power. Magness said officials waited until Sunday to do so because such communication is less effective if put out too far in advance.

Just after 5 p.m. local time on Feb. 14, sleet and freezing rain forced transmission outages. Two hours later, ERCOT hit a new winter peak demand record of 69,222 MW. Reserve margins fell to less than 3,000 MW just after 11:30 p.m., and grid officials in the next two hours scrambled to prevent cascading blackouts that could have caused a "black start" under which outages are no longer in the grid operator's control.

By 1:20 a.m., ERCOT issued a high-level energy emergency alert as 35,434 MW of generation capacity was unavailable.

SNL Image

Outages continued throughout the early morning, and by 1:56 a.m., ERCOT had ordered a total of 8,500 MW of load shed. The grid dropped to a frequency of 59.302 Hz, bringing it dangerously close to collapse. The target frequency is 60 Hz.

"We could not stay there long, we could not go lower" Magness said of the low frequency level, which could cause damage to generators or force them to automatically shut off to prevent damage. "Or we would have risked a blackout of the entire system."

As the storm blew in there were up to 25,000 MW of natural gas outages. Wind turbines froze up.

"This storm affected every generation type," Magness said. "It caused freezing of wind turbine blades. It caused fuel supply issues as well as instrumentation and mechanical issues for natural gas, caused the mechanical-type issues for coal. We had a nuclear outage. This affected the system across the board due to the intensity of the weather we saw and the duration of the weather we saw."

4 days in the dark

Because the load shed was so large, the transmission owners were unable to rotate outages, leaving customers in the dark for the duration of the storm.

"That's where so much of the harm and damage came from," Magness said. "This is something we need to figure out."

Carrie Bivens, ERCOT's independent market monitor, said offer prices reached the $9,000/MWh cap, roughly 300 times the normal price, to provide incentives for generators to offer supply in tough conditions. It could have been as high as $18,000/MWh because of a market mechanism that calculates costs based on fuel prices, and natural gas prices were skyrocketing amid shortages. A PUC order prevented those higher prices.

The limited connections that ERCOT has with grids outside the state allowed for the transfer of power between regions, but those connections proved fruitless, as the Southwest Power Pool, which sent some power to ERCOT, also went into rotating outages.

"Not a whole lot available, even though we have coordination agreements with all of these counterparts," Magness said.

By midweek temperatures began to slowly rise, and most customers had their power restored by Feb. 18. ERCOT called off energy emergencies on Feb. 19.