Blog
06 30, 2023
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The Southern United States has been experiencing a heatwave for more than a week now, with Texas especially feeling the effects. In Austin, Texas, the heat index reached 118 degrees on Wednesday, June 21, a new record for the city.
The oppressive heat has led to record energy demand as the need for cooling remains extremely high. This level of energy demand would normally put strain on the electric grid, risking brownouts or blackouts. However, the grid in Texas has remained stable so far, thanks in part to a variety of energy flexibility and demand response efforts.
The heatwave and ERCOT’s response
June 2023 has been a particularly hot one for regions in Texas, with June 9 being Austin’s first day over 100 degrees – and the weeks following have seen consistent temperatures over 100 degrees. As a result of these temperatures and the subsequent need for energy-intensive cooling measures, demand on the grid in Texas has spiked. The Electric Reliability Council of Texas (ERCOT) reported a new all-time high demand level of 80,828 GW on Tuesday, June 27 – breaking the previous record from just last year.
In response to this unprecedented level of demand for grid energy, ERCOT has implemented a variety of measures to keep the grid stable. They’ve used ancillary service programs like the new ERCOT Contingency Reserve Service to keep the grid stable and asked energy users to voluntarily reduce their energy use. These measures have so far been successful and, as a result, the situation has not progressed to the level of a grid emergency. A grid emergency would lead to a variety of different demand response programs being called to action to prevent the next progression – rolling blackouts.
The effectiveness of demand-side energy flexibility
The situation in Texas so far has been a success story for demand response and energy flexibility. There is a hierarchy of measures that ERCOT moves through in response to high demand and grid stress. The initial measures ERCOT has employed so far for this June heatwave have kept the grid stable, with a variety of different programs still available for ERCOT to leverage.
Many of ERCOT’s steps in the wake of 2021’s Winter Storm Uri have paid off in this situation. The Public Utility Commission in Texas, for instance, increased ERCOT’s industrial demand response budget significantly this year, and that has led to higher participation in several of the measures used so far. Because more organizations now participate in the programs that have been the first steps in response to the ongoing grid stress, the situation has not progressed any further.
It should be noted that voluntary energy conservation is a demand-side measure that can be categorized as demand response. Energy flexibility on the demand-side is growing in importance for grid operators, as it’s a cost-effective method of balancing supply and demand.
A thank you to our customers
Because initial grid reliability measures have so far been successful, Enel’s customers have not been asked to curtail energy usage in any demand response events. Even so, our customers have been on standby, and we would like to thank them for their preparations and efforts to be ready in the case of an emergency. Demand response makes a significant contribution to local grid stability, and we appreciate all the efforts our customers make.
We have also kept our customers informed of possible demand management measures they can take to minimize their energy bill next year by warning them of potential coincident peak times. Energy bills in ERCOT include charges based on 4 Coincident Peak (4CP) usage, an organization’s energy use during the four highest-demand 15-minute periods at the grid-wide scale during the summer months. By minimizing energy usage during these four periods, organizations can drastically decrease their energy bills the next year – but because these periods are unknown ahead of time, it requires significant expertise to accurately predict the peak times. Enel has been effective at predicting these times in the past to help reduce our customers’ energy bills, and we continue to keep our customers informed of the likeliest peak periods this month.
What you can do to prepare for future extreme weather
The continued record heatwave has led to greater interest in energy resilience measures to ensure energy continuity at an individual facility’s site. We call this “operational resilience,” the type of energy resilience that enables facilities to continue energy-reliant processes despite a grid outage. Interest in operational resilience has grown significantly over recent years, as major power outage frequency increased 67% from 2000 to 2020 and outages are expected to further increase due to extreme weather. Solar and battery storage outfitted with back-up controls, for instance, is one popular energy resilience system that is more sustainable than traditional methods, like gas-powered generators. In addition, this solution provides benefits beyond energy resilience that generators don’t – such as energy cost reduction, demand charge management, and carbon reduction.
For many organizations, the cost-benefit for operational resilience can be hard to determine – they need to understand values like predicted loss of sales, damage costs, opportunity costs, and even some more intangible measures like customer dissatisfaction resulting from outages. You can evaluate these factors and more by leveraging the energy resilience decision tree in our eBook, “How to Evaluate Your Energy Resilience Needs.”
For many organizations in ERCOT, the simplest energy resilience decision will be enrolling in demand response. Demand response helps to keep the local grid resilient and can provide your organization with advance warning of any coming grid disruptions, so you can prepare your operations. And demand response provides significant economic benefits – demand response programs offer financial incentives to participating commercial and industrial customers for reducing their electricity usage when called upon by the grid operators during times of grid stress. Demand response provides a win-win situation for the grid and participating businesses – all while helping to keep the lights on and air conditioning running in their local communities.
Looking ahead to the rest of the summer
In May, the North American Electric Reliability published its annual Summer Reliability Assessment for the U.S. power grid. The outlook noted that most of the country could encounter grid issues if temperatures were extreme this summer. That included Texas, although the report said that resources were adequate for peak demand.
In part, this was because the report noted that “load reductions from dispatchable demand response programs have grown by over 18% to total 3,380 MW.” That significant increase has been helpful already in these early stages of summer, and with the continued potential for high temperatures in Texas, demand response programs will likely play a crucial role in the coming months.
Because it’s still early in the summer season, it’s impossible to know what lies ahead, especially as extreme weather events continue to increase in intensity and duration. Even so, it’s important to acknowledge the important role that energy flexibility and demand response have played in helping to keep ERCOT stable so far this summer.
How can you tap into the potential of demand response?
As extreme weather continues to increase in frequency, we need grids that are prepared for more resilient weather – and grid operators will need more organizations to enroll in demand response. Participants can earn significant revenue in demand response if they find the right partner who understands their needs and capabilities in order to maximize their energy potential.
Enel is the world’s largest demand response provider, and we have the experience and expertise to help you maximize the value of your participation. Contact our demand response team today to find out how you can enroll in demand response in your region.
