July 11, 2022
The problem: Texas grid instability & price volatility
Texas power demand has surpassed its previous summer record of 74.8 GW multiple times over the past month. This repeated record-setting not only exceeds history, but also this year’s summer forecast from the Electric Reliability Council of Texas (ERCOT), which was in question even at its time of publication. Now, ERCOT’s short-term forecasts suggest a new threshold will be crossed this week, with demand projected to exceed 80 GW on Monday, July 11th. These trends are placing greater pressure on the already strained and inflexible ERCOT power grid.
Previously, Texans enjoyed some of the lowest electricity prices in the nation due to the market’s unique structure. However, rising fuel costs for fossil generators and extended periods of challenging weather conditions have contributed to increases in both overall prices and volatility.
Under this new regime, competitive pricing for residential power in Texas has leapfrogged the average costs in many other states. With the lingering heatwave in Texas continuing to strain the power grid, less efficient and more expensive generators must be fired up to meet energy demand. As a result, wholesale electricity prices rise and lead to higher energy bills for Texans. In a worst case scenario, outages could force grid operators to initiate rolling blackouts to manage diminishing supply and excess demand.
The solution: Leverage distributed energy resources to dispatch real-time support to the grid
Furthering our work in Texas, we’ve formed a strategic partnership with NRG Energy, a retail electric provider serving C&I customers in Texas, to deploy a real-time grid services program that will deliver numerous benefits to the grid, energy retailers and end customers alike.
Leap and NRG’s partnership offers a readily deployable resiliency measure that strategically and economically manages energy loads in real time, addressing the pervasive energy instability on the ERCOT grid today to prevent blackouts and electricity price volatility.
Bolstering grid flexibility & resiliency
Through its partner network in Texas, Leap is leveraging distributed energy resources (DERs), such as smart building technologies, battery storage systems and EV chargers to offer support to the grid. Via NRG’s real-time economic dispatch program, these smart energy technologies will automatically respond to market signals to curtail their flexible loads when the grid needs it most. This improves grid reliability, helping to keep the lights on for Texans through periods of high energy demand.
Limiting end-customer exposure to volatile electricity prices
Through automated dispatching, participating NRG customer resources enrolled on Leap’s platform will deploy when market prices cross a certain threshold. This helps NRG manage exposure to price volatility, in turn protecting their end customers from rising monthly energy bills.
Unlocking new revenue streams for technology providers
Existing distributed energy assets will continue to perform their primary function for their customers, such as charging EVs, improving comfort and managing energy usage. In addition, Leap’s new program in Texas equips the owners and managers of these technologies to realize untapped economic value. Through Leap’s software platform, these flexible loads can generate revenue by responding to the real-time needs of the grid.
Staying ahead of extreme weather in Texas
The increasing frequency of heat waves and other extreme weather events will continue to strain Texas’s power system and cause compromising grid events. Leap and NRG are working to help Texans stay ahead of adversity by maintaining stable, affordable access to electricity this summer and beyond.