The Texas Power Grid Was Minutes From Collapsing in 2021 and Declaring an Emergency in 2022

U.S. power grids have become increasingly unstable as evidenced by recent problems in Texas.

The last two winters in Texas have highlighted what can go wrong when power grids are unprepared for cold weather, have equipment failures, and are over-reliant on intermittent power sources. Unfortunately, the Texas experience portends similar problems for other U.S. power grids.

De-icing a wind turbine in Texas during Winter Storm Yuri in 2021

Winter Storm Uri

Texas has experienced a surprising number of severe winter storms, with below-freezing and even below-zero temperatures as far south as the beaches on the Gulf of Mexico. The coldest temperatures on record occurred in 1899 when temperatures dipped to 20 degrees below zero in the Texas Panhandle and 8 degrees on the beach in Galveston.

The coldest weather storm to hit Texas in recent years was Winter Storm Uri on February 15, 2021. Uri covered large areas of the western, central, and southern U.S., causing millions of Americans to lose power. Texas bore the brunt of Uri’s freezing temperatures, with most of Texas below freezing and many parts of the state near or below zero for most of a week. Electricity demand skyrocketed, and many power generators dropped off the electric grid due to freeze-related problems, resulting in rolling blackouts encompassing the entire state. On the morning of February 16, the Texas power grid lost half of its generating capacity and was minutes away from a complete collapse. 

Like all power grid operators, the Electric Reliability Council of Texas, or ERCOT, must balance the demand for electricity with the supply of electricity coming into the grid to maintain its stability. If the supply of and the demand for electricity get too far out of balance, an essential requirement for all U.S. power grids, 60 cycles per second or 60 Hertz (Hz), will be breached.

If the electricity coming into the grid exceeds the demand, the grid's frequency will exceed 60 Hz. If the demand exceeds the supply, which is usually the case with hot summer days and cold winter storms, the frequency tends to fall below 60 Hz. The plus or minus threshold for variations in frequency from 60 Hz is only 0.05 Hz. If the grid’s frequency is too high or too low, electric motors don’t work properly, but more importantly, grid equipment can be damaged.

Maintaining 60 Hz is so important that grid operators establish hard and fast rules for how long deviations will be allowed. On the ERCOT power grid, the critical level is 59.4 Hz for 9 minutes before relays start disconnecting generators from the grid, which can cascade into a grid collapse. The countdown to disaster on the Texas grid started at 1:51 AM on February 16, and ERCOT issued blackout orders. Minutes later, the frequency fell to 59.3 Hz, and ERCOT issued additional emergency orders to power generators to immediately shed load. Statewide blackouts started immediately, and within minutes the frequency started increasing. The Texas power grid was just 4 minutes and 37 seconds from total collapse. (Thanks to St. Claire Newbern IV, CEO at Live Energy, Inc., for his observations about Uri and the Texas grid).

Source: Houston Public Media.org

If a total collapse had occurred, a “black start of the entire grid” would have been necessary, starting with physical examinations of every component of the electrical grid and then restarting each element one at a time while adding an equivalent amount of consumption. This process could have taken up to a month or more, leaving some of the 30 million Texas residents without electricity. The humanitarian disaster and economic damage that could have ensued are hard to imagine.

The reasons for the collapse of so much generation capacity are many. One is that wind turbines, which contribute 32% of power on the Texas grid, were not properly winterized and froze, as shown in the photograph above. Attempts at dicing failed, so many were off the grid until freezing temperatures passed.

Some natural gas wells experienced freeze-offs. In some cases, this was due to a lack of winterization, but that was not the only reason. Many natural gas wells froze because electricity to many well sites and compressor stations was cut off during rolling blackouts. This occurred because many of the natural gas compressors that moved natural gas from wells to generating stations had been replaced with electric compressors to reduce CO2 emissions. I had firsthand knowledge of the origins of this problem because I testified before many city councils in Texas years ago, warning that mandating electricity-powered natural gas compressors could cause life-threatening problems during power outages because natural gas wells would be shut in. Unfortunately, many cities in Texas passed ordinances requiring electric gas compressors.

Worse, many electric utilities did not have adequate records showing where natural gas well sites and compressor stations were located on their systems, partly because the operators of those facilities had not filed the paperwork which would have designated them as “critical infrastructure.” As a result, when the local power companies cut electricity to the areas that contained natural gas well sites during rolling blackouts, the compressors stopped moving the natural gas, and the wells shut down due to pressure increases. In turn, this reduced the flow of natural gas to gas-fired electricity-generating plants, which caused more rolling blackouts and more natural gas well shutdowns. It was a cascading nightmare of monumental proportions.

Soon after Winter Storm Uri, ERCOT engaged the consulting firm Energy and Environmental Economics, Inc, referred to as E3, on May 10, 2022, for “consulting services related to analysis, development, and implementation of market design and market structural changes in ERCOT wholesale market.”

The purpose of the E3 study, entitled “Assessment of Market Reform Options to Enhance Reliability of the ERCOT System, released on November 10, 2022, was to suggest “changes to ensure sufficient dispatchable generation resources are available…to meet the reliability needs during a range of extreme weather conditions and net load variability scenarios” Translation: How does ERCOT avoid a future grid collapse when another winter storm like Uri hits or a similar extreme weather event.

Winter Storm Elliott December 2022

As ERCOT considered structural changes in the Texas grid, Winter Storm Elliott descended on most of the U.S. and hit Texas on December 23, 2022. ERCOT said it had a large reserve of power ready to be dispatched, but when the temperature dipped into the single digits, problems quickly developed.

The screen captures below of the ERCOT dashboard at 6:36 PM on December 22 show that when the storm was approaching Texas, ERCOT had 9,414 MW of operating reserves available. The “Grid and Market Conditions” graph on the left shows the 9,414 MW of operating reserve power as the purple-colored gap between supply (top purple line) and demand (green bottom line). The fuel mix at 6:36 PM is shown on the lower right panel, which was 0% solar, 34.9% wind, 64.4% natural gas, 13.7% coal and lignite, and 7.2% nuclear.

12-22-2022: 6:36 PM, Temp 14 deg, Wind chill -3 F

About 24 hours later, the available power reserve dropped to 5.6 MW, shown by the very narrow gap between supply and demand. The fuel mix had changed to 19.5% wind, 59.6% natural gas, 13.3% coal and lignite, and 7.2% nuclear.

12-23-2022:  6:30 PM Temp 10 deg; wind chill -5 degrees

Although ERCOT had a large reserve of power ready to be dispatched when the temperature dipped into the single digits, demand increased faster than ERCOT had anticipated, and some supply was lost due to freeze-related problems. Even though many generators had prepared for the severe winter conditions, many were not ready for the frigid temperatures and started dropping off the grid faster than ERCOT had expected.

On Friday morning, December 23, ERCOT sent an emergency request to the Department of Energy for permission to exceed normal federal air quality restrictions, and DOE quickly granted the request. However, DOE specified that generators could take advantage of the waived requirements only if ERCOT issues a level 2 or higher energy emergency alert, which includes asking residents to cut back power and interrupt large industrial customers' electricity, according to the letter.

“While the vast majority of generating units in the ERCOT region continue to operate without any problem, a small number of units have experienced operating difficulties due to cold weather or gas curtailments,” the DOE said in its order. The order said, “11,000 megawatts of coal and gas-fired power, 4,000 megawatts of wind, and 1,700 megawatts of solar power were out or derated due to weather conditions,” which necessitated the order.

Luckily, enough generating capacity quickly returned online, so ERCOT did not have to take the measures that DOE had approved. Demand on the Texas power grid had reached an all-time winter peak of over 74,000 megawatts on that cold December 3rd morning. Texas narrowly dodged the bullet of implementing rolling blackouts or another near-grid collapse as happened in Winter Storm Uri just 22 months earlier.

By 8 PM Friday, December 23, the fuel mix reported by ERCOT was 4.1% wind, 73.4% natural gas, 14.6% coal and lignite, and 7.7% nuclear, and the temperature in north Texas was still below freezing at 21 degrees. The wind had mostly stopped, and natural gas-fired generation picked up the slack.

Lessons Learned

While the Texas power grid managed by ERCOT was better prepared for Winter storm Elliott in 2022 than for Winter Storm Uri in 2021, it was only marginally so. The underlying weakness of the ERCOT model that was exposed by the last two winter storms is that it is an “energy-only” market. If a generator puts power into the grid, they get paid for it. There are no payments for standby capacity, which occurs with grids that are “capacity” markets.

This was recognized in the E3 study, which offered several new approaches. ERCOT has focused on redesigning the electricity market using “performance credit mechanisms” or PCMs to incentivize generators to be available during periods of high electricity demand. ERCOT has signaled that PCMs may be their preferred plan for “long-term market design reform options to promote the supply of dispatchable generation and focus on reliability.”

Where do we go from here?

The Texas experience in the last two winters highlights the problem that all U.S. power grids have become increasingly unstable in recent years due to over-reliance on intermittent, non-thermal power sources such as wind and solar. These problems will likely worsen as a result of the increased renewable subsidies in the Inflation Reduction Act (IRA), which extends and increases the Production Tax Credit (PTC) and the Investment Tax Credit (ITC) for wind and solar. In many states, this only shifts some of the subsidies from state RECs (renewable energy certificates) while the state RPS (renewable portfolio standards programs) will force the addition of wind and solar. Non-subsidized generators cannot compete with below-market or negative prices that these subsidies create.

Renier Kuhr investigated grid problems resulting from overreliance on intermittent power generation in an excellent and detailed analysis of the New England power grid entitled “Technical and Economic Limits for Renewable Power Integration in New England.” The first sentence in the abstract summarizes the problem succinctly: “Adding wind, solar, and energy storage facilities on a large scale to replace gas combined cycle plants encounters major technical and economic limits.”

ERCOT’s consideration of Performance Credit Mechanisms" appears to be a good first step toward leveling the playing field and stabilizing the Texas grid but more innovation may be needed.