While energy issues in Texas continue to make headlines, some may not know how the Texas power grid works. Amid an ongoing summer heat wave, here is everything to know about how energy is produced and managed in Texas.
How does the Texas power grid work?
THE ELECTRIC GRID
Texas' main source of energy for its electric grid is natural gas, which represents 44 percent of the state's energy generation. Texas has the largest amount of wind energy capacity in the U.S., according to ERCOT, with wind making up 29 percent of the state's power capacity. The state also uses coal (12 percent), solar (9 percent) and nuclear (4 percent) sources to power the grid, ERCOT's website shows.
Texas' electric grid is independent of the two other major power grids in the U.S.: the Eastern Interconnection and the Western Interconnection. The independent electric grid in Texas manages the flow of electricity to 26 million Texans, which is about 90 percent of the state's electric load, according to ERCOT. Parts of West Texas, such as El Paso, are in the Western Interconnection, while much of East Texas, from Jefferson County up to Bowie County, are in the Eastern Interconnection, according to ERCOT.
There are advantages to Texas being on its own electric grid, according to Thomas Overbye, director of the Smart Grid Center at Texas A&M. By being separate from the two other national grids, which cross state lines and are subject to federal oversight, Texas' grid avoids some national regulations, though not all.
"The gist is by being separate, we do maintain more autonomy," Overbye said. "As Texans we tend to like that."
Carey King, assistant director of the Energy Institute at the University of Texas — Austin, said another advantage to the state having its own grid is that it does not need to rely on other stakeholders when making decisions. King said this can make enacting plans for the grid quicker and more efficient.
"If the Texas Legislature did decide to have some sort of goal or plan for electric generation in Texas, within ERCOT they could enact this plan without any other state or [the] federal government weighing in or having to decide whether or not it's a good idea," King said.
However, Overbye said the main disadvantage of the state having its own electric grid is that Texas cannot share resources with neighboring states when there is not enough energy. He said this is not the case for states in one of the two national interconnections or for the parts of Texas that are not covered by the ERCOT grid.
"(One of the) major benefits of interconnection is you can share resources," Overbye said. "The part of Texas that is in the (Eastern Interconnection), like Beaumont, if there's a problem there, they can get electricity coming across the border from Louisiana."
WHAT IS ERCOT?
ERCOT was created to oversee the transmission of electricity in the state in 1970 by the Texas Interconnected System, the Texas utilities operator that formed during World War II to aid in the war effort, according to the Public Utility Commission (PUC). In 1996, ERCOT became the nation's first independent service operator, meaning it manages the grid while not owning any assets on it, and it began managing wholesale competition on the grid.
In 1999, ERCOT was restructured, according to its website. Along with the transition of the state's energy market to a retail system, the Texas Legislature made ERCOT's main priorities maintaining system reliability, facilitating the competitive wholesale and retail markets and ensuring open access to energy transmission.
ERCOT is run by an 11-member board of directors, two of which are nonvoting members. The PUC, which is governed by the Texas Legislature and governor, determines the organization's policy direction.
ERCOT is like the traffic cop of the Texas electric grid, King said. It directs where power goes, decides which generators turn on and off and is an accountant for the finances of energy generation in the state.
Wholesale competition, which ERCOT facilitates, allows energy companies to compete in an energy marketplace and sell power to the state, King said. Each day, the council projects the amount of power it will need for the next day and accepts bids from energy companies to provide that power. The council also purchases power reserves, which is power from an energy company that is ready to be generated in case of unforeseen circumstances.
ENERGY CONSERVATION ALERTS
ERCOT sends energy conservation alerts when the demand for power is higher than the supply for the day, the organization's website states. ERCOT maintains operating reserves to meet tight grid conditions if demand is outpacing supply. If operating reserves drop below 3,000 megawatts (MW), ERCOT brings additional generation online and releases reserves and works with commercial and small industrial companies to reduce power.
If operating reserves continue to fall, ERCOT has three Energy Emergency Alert levels, its website says. Level 1 is reached when reserves dip below 2,300 MW. At this stage, the organization can import up to 1,220 MW of energy from neighboring grids and deploy additional energy resources.
ERCOT issues an energy conservation alert when Level 2 is reached, which is when reserves drop below 1,750 MW, according to the organization's website. At this stage, the council also works with large industrial customers who are paid to reduce their power. When reserves drop below 1,430 MW, Energy Emergency Alert Level 3 is reached and ERCOT begins controlled outages across the state.
A lack of energy supply could also be the result of the organization not properly predicting demand and therefore not purchasing enough energy, King said.
King also said energy shortages can occur when power plants that ERCOT had expected to come online the previous day do not end up producing power for the state.
In a statement, ERCOT said it expects to have "sufficient generation to meet forecasted demand" this summer.
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