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Highlights

Solar topped wind for two hours on August 15

Heavy usage brought outages

'Lessons learned' from event

Houston — As wind output waned and real-time power prices surged in the Electric Reliability Council of Texas on August 15, solar output eclipsed wind output around noon, and industry observers said Friday this may happen more often as the state's solar capacity grows.

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An analysis of the hourly output for wind and solar shows that from 10 am to noon on August 15, solar output topped 1.5 GW, while wind output was less than 1.3 GW.

"Given that we're currently tracking nearly 2.2 GW of new solar capacity slated to come online before next August, these instances will most certainly become more common," said Travis Whalen, a power market analyst at S&P Global Platts Analytics.

On Thursday afternoon, the Public Utility Commission of Texas posted to its website an ERCOT report about the August 15 Energy Emergency Alert that states that when reserves were lowest, 2,134 MW at 3:18 pm CDT, wind generation was 1,967 MW and solar generation was 1,312 MW.

Asked whether solar's growing capacity might outstrip wind output during next summer's peak, Eric Smith, Tulane Energy Institute associate director, noted that solar is growing at a faster rate than wind in Texas.

"I think solar actually helps to mitigate peak demand issues, since it is not entirely coincident with wind output," Smith said in an email Friday. "Of course the danger is that there is always a small probability that they can lose both wind and solar during their peak demand period in the late afternoon. It's a big state, but it is not immune from uniform heat reducing wind velocity at the same time that the sun is setting."

But Wade Schauer,research director for Americas power and renewables at Wood Mackenzie in Sacramento, California, said ERCOT also has "a lot of wind" slated to come online by next summer, "so I'm not sure solar will eclipse it, but all else equal, the solar additions will help in a repeat of this weather pattern."

ERCOT filed an earlier report regarding the August 13 EEA, which states that when reserves were lowest, 2,025 MW at 3:14 pm, wind was producing 3,970 MW and solar was producing 1,357 MW.

GENERATION OUTAGES

Resource outages totaled 4,220 MW during August 13's lowest reserves period, the report said, and 5,807 MW during August 15's lowest reserves period. Both were primarily forced outages. The August 15 report notes that outages of intermittent renewable resources -- wind and solar -- totaled 913 MW at that time, while 4,894 MW of the outages were non-IRR, mostly thermal. The type of outages on August 13 were not specified.

Schauer said these levels of outage were "fairly normal."

"It is not uncommon for generators to have some mechanical issues after running hard during an extended heat wave," Schauer said.

Campbell Faulkner, senior vice president and chief data analyst at OTC Global Holdings, an interdealer commodities broker, said the high level of generation outages, in comparison with last summer, "was likely caused by units running above nameplate or at absolute capacity."

Platts Analytics' Whalen said, "That's a problem that is somewhat unavoidable in instances where you have multiple high net load days one after the other, since many units at the far end of the stack are going to be older with greater need for maintenance."

On pricing, the August 13 report states that "most Settlement Point Prices reached the $9,000/MWh cap at approximately 3:15 pm and remained there until approximately 4:55 pm."

For August 15, prices hit the $9,000/MWh cap around 2:45 pm CDT and remained at the cap "for the majority of the EEA ... event" which ended at 5:05 pm, the report states.

'LESSONS LEARNED'

Asked what the PUC might take as "lessons learned" from last week, Whalen said, "I think the risks from forced outages certainly help make the case for increased deployment of batteries, given their comparative advantage in forced outage rates."

OTC Global's Faulkner said the EEA events will likely result in "a discussion over the capacity market once again or other mechanisms to replace the retired and mothballed coal fleet."

Tulane's Smith said, "I think ERCOT will probably move up their phased notifications in order to maintain something more than the minimal 2.3 GW of reserve, at least during future summer heat waves."

Wood Mackenzie's Schauer said he has "no idea" what lessons the PUC might take from the EEAs.

"Many people are arguing that this is exactly what the ERCOT market design is supposed to do -- result in extremely high prices that will hopefully incentivize new generation to be built," Schauer said.

PUC spokesman Andrew Barlow said, "The market worked as designed last week, maintaining reliability by showing flexibility as supply fluctuated in typical ways due to maintenance outages and natural forces. If anything, the experience should strengthen Texans' confidence in the ERCOT system and inspire investment in new generation."

-- Mark Watson, markham.watson@spglobal.com

-- Edited by Gail Roberts, newsdesk@spglobal.com