Rolling blackouts could spike in 2012
ERCOT says power outages more likely under EPA rule.
By Tom Fowler
September 2, 2011
Rolling blackouts will be much more likely in Texas next summer if new Environmental Protection Agency rules take effect as planned, according to a report released Thursday by the state's main electric grid manager.
The rules, which caught power industry interests by surprise when they were unveiled in July, could lead to the shuttering of as much as 1,400 megawatts of coal-fired power plant capacity in Texas during the summer and up to 6,000 megawatts during other times of the year, according to the study by the Electric Reliability Council of Texas.
The state's total capacity, including plants in mothballs, is a little more than 75,000 megawatts, grid operators say.
ERCOT has declared power emergencies several times this summer as record demand met unplanned power plant outages. Operators say the hot summer has meant more wear and tear on power plants because of longer operating hours.
On Aug. 4, the state came close to initiating rolling blackouts when the margin between power supply and demand grew too thin.
“Had this incremental reduction been in place in 2011, ERCOT would have experienced rotating outages during days in August,” the grid manager said in the study.
In July, the EPA issued the final version of its Cross-State Air Pollution Rules, which require reductions in nitrogen oxide, sulfur dioxide and particulate emissions that cross state lines and contribute to ground-level ozone.
An earlier draft version didn't mention Texas, but under the final rule, Texas power plants would have to provide more than 25 percent of the reductions starting Jan. 1.
But the EPA said its models show that Texas has “an ample range of cost-effective emission reductions options for complying with the requirements of this rule without threatening electricity reliability or the continued operation of coal-burning units.”
“We look forward to meeting with ERCOT to discuss and review their analysis of the Cross-State Air Pollution Rules,” the EPA said in a statement Thursday.
Compliance plans being drawn up by power plant owners offer various scenarios for power capacity.
One indicates about 3,000 megawatts of generation capacity would be brought offline during the off-peak months of March, April, October and November, ERCOT said, with 1,200 to 1,400 megawatts offline for the rest of the year including the peak load months of June, July and August.
These could be higher if more plants required maintenance or if there were short supplies of low-sulfur coal that can help plants comply with the EPA requirements.
A recent research report from Sanford C. Bernstein & Co. says Texas coal plants could meet the new emissions restrictions if they used their existing scrubber systems for longer periods.
Plants without such scrubbers could meet the new standards by mixing their lignite with lower-sulfur coal, the study says.
But in a conference call with reporters Thursday, ERCOT's system planning manager, Warren Lasher, said running the scrubbers around-the-clock would not significantly change the overall emissions from the plants because facilities that have scrubbers already operate them most of the time.
He also said existing coal supplies and railroad infrastructure may not be sufficient to handle a switch to low-sulfur coal.
ERCOT and Texas power plant owners have other options for maintaining grid reliability and responding to the impending measures.
ERCOT could ask power plant operators to bring more units out of mothballs — most of them older natural gas-fired units — to have them ready for peak demand.
Three mothballed plants came online in recent weeks to help the state through the rest of the summer.
ERCOT also could try to expand two programs designed to get commercial customers to cut back use on short notice during peak demand.
Another proposal under discussion would double the price ceiling in the spot power market to $6,000 per megawatt-hour as a way to encourage more power plant operators to fire up their units.
The threat of power reliability problems could create political pressure to delay the new rules, however, say Kevin Book and Chase Hutto, principals in the energy policy consulting firm Clearview Energy Partners.
President Barack Obama may believe he needs to continue to stand by the EPA time frame to satisfy some of his core constituents, while the last-minute addition of Texas to the rules may give Republican officials incentive to try and block the measure in the courts.