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Highlights

Peakload forecast to reach nearly 49 GW July 1-2

Historical early July peakload not exceed 47.9 GW

SPP forecast wind peak as low as 7.5 GW July 3

Houston — Southwest Power Pool has issued a resource alert across its entire footprint with peakload expected near 49 GW later in the week starting June 28, the highest start of July in the grid's history and within about 3% of the all-time peakload record.

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The resource alert, with effect from July 1 and through July 3, is due to higher than normal outages, high loads, wind forecast uncertainty and weather forecast, according to the SPP notice. As a result, the SPP Balancing Authority may use greater unit commitment notification timeframes, such as making commitments prior to the day-ahead market and/or committing resources in reliability status.

"SPP is closely monitoring the forecast as we approach the resource alert period, and we are confident in our ability to reliably manage the operation of the bulk electric system," SPP Spokeswoman Meghan Sever said June 29.

Near-term outlook

Wind-powered generation, a growing fuel source in SPP and the main fuel source year to date, is forecast to drop over the next several days.

"Wind is a highly variable generation source, and while we do not have a 'normal' amount of wind, we are currently forecasted to be under 3 GW for peak hour on July 1," Sever said. "This is considered low because it is under 15% of our installed capacity."

Peakload is forecast to reach about 48.925 GW at 5 pm CT July 1 with wind generation forecast around 2.525 GW during that same hour, steadily dropping throughout the day from a high of 13.225 GW at the start of the day, according to SPP data.

SPP peakload is forecast to reach nearly 48.925 GW at 5 pm CT July 2 with wind forecast at around 5.7 GW for the same hour, as peakload is expected near 46.25 GW at 5 pm July 3 with wind forecast at less than 3.9 GW at the same time, according to SPP data. SPP peakload has not surpassed 47,900 MW in early July in the last decade. The SPP all-time peakload record is 50.662 GW reached August 19, 2019.

"While load is expected to be high, it is not expected to exceed the record peak for July of 50,622 MW set July 21, 2016," Sever said.

Oklahoma City high temperatures are forecast from 96 degrees Fahrenheit to 102 over the dates the alert is issued, well above the 5-year average in the low 90s, according to the US National Weather Service.

The high temperatures and rising demand, coupled with low wind expectations, are pulling up power prices.

SPP South Hub on-peak balance-of-the-week was bid at $28/MWh on the Intercontinental Exchange June 29. In comparison, SPP South Hub on-peak day-ahead locational marginal prices have averaged about $20.50/MWh so far in June, according to SPP data.

SPP wind trends

As part of the energy transition sweeping the nation, wind generation has increased from 6% of SPP's share in 2011 to nearly 34% year to date, according to SPP data. Year-to-date wind generation is up 6 percentage points year on year and is 7 percentage points higher than gas-fired generation for the first half of 2020, according to SPP data. Wind's share of the market first surpassed other fuel sources a few months last year and has maintained the lead fuel source position in 2020.

Wind generation is forecast to peak at roughly 13.150 GW July 1, 9.875 GW July 2 and 7.500 GW July 3, a drop from about 16 GW June 28, according to SPP data. Wind reached its highest level of the year at about 16.875 GW on June 17, according to SPP data.