Report: New efficiencies could ease strain on power markets

New measures to reduce electricity use could curb growth in Texas’ peak power demand by 40 percent to 50 percent over the next two decades, reducing the need to build new generating capacity and lowering prices for ratepayers, a new report shows.

Texas’ power market could restrain peak-demand by 5,000 to 7,000 megawatts through 2032 by exploiting new energy efficiency and through demand-response programs that rein in power use when demand is highest, the consulting firm Brattle Group said in a report Tuesday.

One megawatt is enough to power 500 Texas homes under normal conditions, according to the Electric Reliability Council of Texas, which runs most of the state grid.

Peter Fox-Penner, principal of the Brattle Group, said in a conference call with reporters Tuesday that demand curtailments in the group’s projection models would reduce the need to construct new power generation capacity of any kind.

Demand response programs include agreements with electricity consumers to reduce their use during peak periods, sometimes in exchange for lower rates or other price breaks.

Consumers also can reduce demand through such measures as upgrading to more efficient air conditioners and lighting.

The Brattle Group prepared Tuesday’s report for the Texas Clean Energy Coalition. The latest report –  the third the coalition has sponsored – was modeled to include projections on how new efficiency initiatives might play out in power markets over the next 20 years.

The report also examined how projected demand reduction could affect greenhouse gas emissions, in which Texas leads the nation.

Consumer energy efficiency and demand response programs, along with the power efficiencies that will be built into $71 billion in planned new petrochemical plants, could curtail carbon emissions  by 143 million metric tons, a drop of 4 percent, by 2032.

“We see an opportunity to build a cleaner and more affordable ERCOT,” said former state Republican Sen. Kip Averitt, chairman of the Texas Clean Energy Coalition.

It  helps that  renewable energy sources and natural gas, which produces fewer carbon emissions than coal, are still expected to dominate whatever new capacity is built.

Averitt said the Brattle Group’s projections suggest reduced demand growth could help the state reach the Environmental Protection Agency’s new 2030 carbon-reduction goals.

“We’re close to meeting some important criteria and we’re doing it in a fashion that’s favorable to our rate payers,” he said.

The EPA on Monday released one of the toughest sets of U.S. environmental rules on carbon ever, requiring power-plant carbon emissions to drop  30 percent nationwide and 39 percent in Texas by 2030.

ERCOT codes and standards, as well as new efficiency initiatives planned by utilities, also could help reduce peak demand, according to the report.

And the Brattle Group found that the state electric grid, by exploiting opportunities in the market, could add 2,300 to 3,800 megawatts to its portfolio of demand-response programs, more than doubling it.

“These are modest scenarios, not radical in any regard, and they’re going to produce rather significant savings” by avoiding some capacity additions, Fox-Penner of the Brattle Group said.

< Go Back