87 posts categorized "Electricity"


Energy Future Holdings postpones interest payment, earnings release

Energy Future Holdings, the Dallas-based power company seeking to reorganize its troubled finances, on Monday said it would delay filing its 2013 financial results and postpone an interest payment while it negotiates with creditors. EFH, staggering under nearly $40 billion in debt, is expected to file a Chapter 11 bankruptcy petition in the near future. For the past year it has been in talks with lenders trying to reach a consensus on its reorganization, which would speed a bankruptcy proceeding.

Texas Competitive Electric Holdings Co., which includes EFH’s deregulated subsidiaries  Luminant and TXU Energy, said that “given the constructive nature of these ongoing discussions,” it “has elected not to make certain interest payments due April 1, 2014, and to use the permitted grace periods” allowed it.

-- Jim Fuquay


Study: Texas gained 6,368 jobs in 2013 from clean energy and transportation

Texas projects involved in clean energy production and energy-efficient transportation projects added 6,368 positions last year, according to a new report by Environmental Entrepreneurs. The state ranked No. 2, behind California's 15,397 jobs. One example cited among the eight projects in Texas was the 80-turbine, 165-megawatt Cameron Wind farm in South Texas announced by Apex Clean Energy, which could create more than 200 jobs.

The study looked at jobs in power generation and manufacturing, building efficiency, public transportation and other sectors. It counted more than 78,600 jobs nationally at newly announced projects, projects under construction or job additions at existing projects. The report said 32,500 jobs were power-related, with solar power was the biggest in that sector with more than 21,600 jobs.

Texas was No. 1 nationally in new jobs in the fourth quarter, the report said, with about 3,286 jobs, including 1,400 in five different wind power projects. Texas is No. 1 in wind power capacity, with more than 11,000 megawatts.

It's the second year for the study, which listed more than 100,000 jobs in 2012. The decline could be related to a change in methodology, the group said. Environmental Entrepreneurs describes itself as a national group of business leaders who promote sound environmental policy and economic prosperity. Its web site is here.

-- Jim Fuquay


Texas wind power cutting emissions, environmental group says

A new study says Texas' renewable energy standards have been by far the biggest contributors to cutting greenhouse gas emissions. The study, released today by Environment Texas, estimates that the state has reduced GHG emissions by nearly 20 million tons in 2012, of which 12.6 million tons came from policies mandating electricity production from renewable sources, a requirement largely filled with wind power. Texas is the  nation's biggest producer of electricity from wind, and last year wind supplied nearly 10 percent of all the electricity used in the state. Also contributing to lower GHG emissions were energy-efficiency requirements and other state and federal policies, the study said. The study said that nationally, emissions of carbon dioxide declined more than 12 percent between 2007 and 2012.

-- Jim Fuquay


ERCOT details outages during Jan. 6 cold snap

It's good that the operator of the state's largest power grid is able to show exactly where the problems are when power gets in short supply during unusual circumstances, but it doesn't always inspire total confidence in the system. The Electric Reliability Council of Texas on Friday released a report on the Jan. 6 cold snap that pushed ERCOT into what it calls a Level 2 Energy Emergency Alert. By the end of the day, 97 power generation units around ERCOT's system had experienced some sort of issue - tripped offline, failed to start or were derated (saw their output decline). Problems according to ERCOT's report included:

  • Generator outages specifically tied to the weather hit units representing 3,541 megawatts of capacity. The bulk of that, units with close to 3,000 megawatts of capacity, reported "frozen instrumentation." (A unit is an individual machine generating electricity; there can be several units at large power plants.)
  • Another 1,643 megawatts, all at natural gas-fired units, were unavailable because of restrictions in their supply of fuel.
  • More than 30 wind farms said were out because their turbines reached their "low temperature limit." Lindsay North, a spokeswoman at the American Wind Energy Association, said that's related to the performance of lubricants and concerns about brittleness of components in Texas wind turbines, which don't have the same cold-hardened designs used in colder climates. North noted that “wind was only 5.7 percent of the capacity taken offline by the cold, even though wind is about 15 percent of the state’s capacity, so wind energy fared far better than the average for other fuel types."

 All told, 9,355 megawatts of capacity was unavailable when the emergency alert was first issued.

In comparison, ERCOT enters a Level 1 Energy Emergency Alert when it has less than 2,300 megawatts of capacity in reserve, meaning that generation supply is available if needed. ERCOT goes to Level 2 when that reserve drops to 1,750 megawatts, and the response includes calling on users that have agreed to have their power curtailed at such times. Level 3 is rotating blackouts, where local utilities drop customer load piecemeal.

ERCOT said it underestimated demand going into Jan. 6 by about 2,400 megawatts, although by 4 a.m. that morning it's expected load "was closer to the actual load for most of the day," owing to updated temperature forecasts.

-- Jim Fuquay




ERCOT sees slim power reserve going into summer

The scheduled arrival of four new power plants in early summer should mean adequate electricity supplies this summer, although conservation could be needed if temperatures are high before those new plants come online, says the Electricity Reliability Council of Texas, the state's largest power grid. ERCOT said peak summer demand could top 68,000 megawatts, just short of the 2011 record peak. “We typically experience highest demand later in the summer,” said Warren Lasher, ERCOT's director of system operations. “If the new generating plants become commercially available as scheduled, we expect to have sufficient reserves to serve anticipated peak demand.” That outlook uses ERCOT's historical method of counting just 8.7 percent of wind power capacity, which it is considering upgrading significantly. Last week ERCOT said it had lowered its outlook for power demand in future years, a move that improved the grid's reserve margin.

-- Jim Fuquay


ERCOT: Conservation watch ends, new March demand record

The Electric Reliability Council of Texas said this morning it was ending its call for conservation in the face of bitter cold over much of its service area, which includes North Texas and about 85 percent of the state's power demand. The state's largest grid also said it set a new record for the use of electricity in the month of March of 54,549 megawatts.

-- Jim Fuquay


ERCOT: New generation improving Texas electricity outlook

The state's largest power grid goes into the summer demand season with anticipated capacity just slightly below the desired level as of June 1, but improving by August, when usage typically peaks. The Electricity Reliability Council of Texas said today its latest forecast estimates a reserve margin as of June 1 of 13 percent, compared to its 13.75 percent target. The scheduled addition of three new gas-fired power plants by Aug. 1 should bump that up to 16 percent, ERCOT says. The forecast reserve margin in 2014 rises to 15.4 percent, then declines to 14.1 percent in 2015 and 12.8 percent in 2016. Those outlooks are is based on 12-year averages. ERCOT said it will release its forecast based on extreme temperatures and generation outages on March 5.

ERCOT's outlook has become of particular interest politically, as the Public Utility Commission of Texas has been considering adopting a payment system, called a capacity market, to encourage generators to add enough capacity to avoid electricity shortages. The Texas Association of Manufacturers, which opposes adoption of a capacity market, issued a statement in which its president, Tony Bennett, said "the state’s reserve levels are more than adequate to reliably and economically serve customers’ needs into the foreseeable future." He said ERCOT's new forecast shows the PUC "made the right decision to redirect its efforts away a mandated forward capacity market, which would create subsidies and increased costs for Texas consumers."

Friday's reserve margin forecast incorporates revisions ERCOT made to account for changing patterns of electricity use that have had the effect of lessening peak demand on its grid, which serves about 85 percent of Texas' total power demand. “Although population and the economy continue to grow in the ERCOT region, the relationship between economic growth and peak electric demand has changed in the past several years,” Warren Lasher, ERCOT director of system planning, said in a news release. “We believe recent improvements to our load forecasting methodology are providing a more realistic view of the future electric demand we need to be prepared to serve.” Under its previous outlook, called a Capacity, Demand and Reserves (CDR) report, ERCOT had forecast a reserve margin in 2014 barely above the target, then dropping below it in 2015 and continuing to decline.

ERCOT also said it might increase wind power's estimated contribution to the grid. It presently counts only 8.7 percent of installed wind capacity when forecasting how much power will be available at peak usage times. ERCOT said that figure is "conservative," and new analysis shows that 14 percent of capacity can be expected from the state's West Texas wind farms, which are the vast majority of installations, and that coastal wind farms could operate at 27 percent "due to the prevailing coastal wind patterns during late summer afternoons." (Winds in West Texas tend to fall off in those hours.)

-- Jim Fuquay




Lesson from Europe: Renewable energy = need for capacity payments?

It can be challenging to follow Texas' ongoing debate over whether the state has enough electricity capacity to meet peak demand and what should be done about it. There are odd terms thrown about and totally conflicting claims about whether the state should move to a "capacity market" -- paying generators upfront to make enough supply (capacity) available to meet those relatively few hours of peak demand a few days each summer in Texas.

Texas' deregulated energy market now only pays generators when they sell their power, which has that certain ring of free-market fairness to it. So why change?

Here's a report out of Europe than might help explain part of the problem: The more renewable energy put on the power grid, it says, the greater the need for capacity payments.(And Texas leads the nation in wind power, with 11,255 megawatts connected to the state's biggest power grid, the Electric Reliability Council of Texas. That's about 15 percent of ERCOT's available capacity, according to its latest report, and last year wind provided 9.9 percent of total electricity used in ERCOT.)

The European Union, meanwhile, expects to hit 35 percent renewables by 2020 - not that far away - so they've been forced to face this issue earlier than us.

"In a renewables system, capacity will be scarce and energy potentially abundant," said Andreas Regnell, head of strategy and sustainability at Swedish utility Vattenfall, said at a Feb. 6 conference in Belgium, according to the report by Platt's, which does a lot of specialized reporting on energy topics. What does Regnell's statement mean?  Basically, that when renewables are humming along - the wind is blowing and the sun is shining on solar panels - there's plenty of juice. And it's practically "free," since the expense of renewables is nearly all in the initial  (likely subsidized) construction of the wind farms and solar installations. It displaces other electricity sources, who have to hope to cover their costs even as they run less.

The Platt's report continues: "That makes capacity remuneration mechanisms 'unavoidable' in countries with large shares of renewables with zero marginal costs, such as Germany, said Paul Giesbertz, head of infrastructure and market policies at Statkraft Markets, the German-based arm of Norwegian utility Statkraft."

All that's left, in this view, is designing the best way of doing that. You can read about what alternatives the Europeans are trying for yourself with the Platt's article, here. We don't know what the right answer is, but the article presents the issue in a  way we just haven't seen previously.

-- Jim Fuquay



Report: EFH bankruptcy near after creditor talks fail

The Wall Street Journal reports that Dallas-based Energy Future Holdings is preparing for a bankruptcy filing after months of talks with creditors have failed to produce an agreement on restructuring nearly $40 billion in loans. Citing unnamed sources, the newspaper said a last-minute deal is possible, but EFH is lining up debtor-in-possession (DIP) loans to keep its operations running during bankruptcy proceedings. The filing has long been expected, as the economics of the 2007 leveraged buyout of the former TXU Energy by big investors was torpedoed by the collapse in natural gas prices. The wholesale electricity market in Texas' deregulated markets is largely driven by the price of natural gas, the fuel behind about 40 percent of the state's power last year.

The Journal says a bankruptcy filing would also mean a split-up of EFH's operations. The company now includes: Luminant Generation, the state's largest electricity producer; TXU Energy, the largest electricity retailer; and 80 percent of Oncor Electric Delivery, the regulated utility that owns the poles and wires distributing power to most of North Texas.

-- Jim Fuquay


Luminant to bring back coal-fired plants ahead of schedule

Luminant Generation said it will bring three coal-fired power units back into production sooner than previously planned as higher Texas power prices make the units more economic. The big Dallas-based electricity generator had shut down the plants, located in East Texas, last fall, saying the state's low wholesale power prices didn't justify their operation. It will now bring back two units by Feb. 15 and a third unit by March 1. They have combined capacity of 1,880 megawatts.

Especially cold weather in Texas and much of the nation in recent months has driven up both the price of natural gas and of electricity in deregulated markets. Natural gas is the No. 1 fuel for generating electricity in Texas, but coal is close behind. "Power prices have risen in recent weeks following the rise in natural gas prices due to the cold weather across the nation that is increasing demand," Luminant spokesman Brad Watson said in a prepared release. "By bringing these units back online, we not only make more electricity capacity available for Texas' grid, we make more natural gas available for Texas and the rest of the nation that would otherwise have been used for electricity generation here."

-- Jim Fuquay



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