Texas wholesale electric prices spike more than 10,000% amid outages

[dalton99a]

https://www.reuters.com/article/electricity-texas-prices/update-2-texas-wholesale-electric-prices-spike-more-than-10000-amid-outages-idUSL1N2KL0XG

February 15, 2021 8:17 AM
Texas wholesale electric prices spike more than 10,000% amid outages
By Tim McLaughlin

(Reuters) - The spot price of wholesale electricity on the Texas power grid spiked more than 10,000% on Monday amid a deep freeze across the state and rolling outages among power producers, according to data on the grid operator’s website.

Real-time wholesale market prices on the power grid operated by the Electric Reliability Council of Texas (ERCOT) were more than $9,000 per megawatt hour late Monday morning, compared with pre-storm prices of less than $50 per megawatt hour, according to ERCOT data.

The surge reflects the real-time megawatt hour price of electricity and the cost of congestion and losses at different points across the grid. Early on Monday, ERCOT said extreme weather conditions forced many power generating units off the grid, upending the supply of electricity.

On Feb. 10, well before inclement weather hit Texas, spot wholesale prices on ERCOT settled around $30 per megawatt hour at the end of the day, ERCOT data show. But on Sunday, the price per megawatt hour surged past $9,000 on the grid.

ERCOT can be more susceptible to wholesale price spikes because it does not have a capacity market, which pays power plants to be on standby during peak demand and weather emergencies, for example. ERCOT’s model means consumers are not paying for generation that may never be called into action.

But early on Monday, ERCOT said extreme weather conditions caused many generating units – across all fuel types – to trip offline and become unavailable. That forced more than 30,000 megawatts of power generation off the grid, ERCOT said in a news release.

[AllaN01Bear]

1. price gouging to the max.

[jimfields33]

4. Terrible

I heard the wind binds are frozen and it’s 23 percent of the energy for Texas. They should not be able to price gouge ever but especially during an emergency.

[Volaris]

8. No wonder cruz needs to beg from the federal government for his voters

Capitalism in action, baby.

[Enterstageleft]

2. Please remind me why capitalism is so much better than Socialism...

It's better to let people freeze and go bankrupt than to take away our chance to fuck you in the ass when you most need help?

Is that it?

[Volaris]

9. Since cruz is getting a campaign kickback from Astroglide, ya...

Keep the assfuckings coming, and if necessary he can go beg biden for condom money, essentially.

[JI7]

27. Socialism is a failure also . Taxing and providing services is not socialism . California is not

socialist .

[DBoon]

3. and they don't even have Enron to blame for this

[Wounded Bear]

5. Let's privatize the power grid. What could go wrong?

I feel for the people of Texas, but oh well.

[ooky]

6. Paving the way for electricity insurance.

A new opportunity for rich people to steal.

[splano]

7. It's out of control

Yeah. It’s comically high right now.

https://www.zerohedge.com/energy/energy-emergency-texas-power-provider-warns-rotating-outages-cold-weather-tests-limits-grid

Update (1715ET): As the day has progressed, amid deteriorating weather forecasts and no let up in demand (despite ERCOT's urgings), our trader contact at a Houston energy firm sums the situation up as eloquently and succinctly as ever:

"we've officially hit the 'Holy Fucking Shit Levels' here..."

Ancillary Services, specifically Responsive Reserves which ercot issued an operational notice stating they needed more offers, does not have the same $9,000 cap level. It cleared a comical eleventy gabillion; actually a cheap $11,950.....PER MEGAWATT.

Do the simple math on that.

If you are a retailer, obligated to, lets just say, 25MW, and did not hedge (meaning you left it to get filled by ERCOT at market clearing price), you just incurred a $7.1M cost on an around the clock basis for a single day.

[pnwmom]

17. Regardless of the contents of this particular article, Zerohedge is a rightwing conspiracy theory

website.

We shouldn't be promoting Zerohedge here.

https://www.mediamatters.org/zero-hedge

[A HERETIC I AM]

10. They have done this to themselves

Texas is an “Energy Island”

Look it up.

This is state policy, in that they are basically unable to import electricity via any high tension line network from neighboring states.

In an effort to render themselves autonomous, they have made themselves ultimately vulnerable

[ret5hd]

11. How hard is it to pry guns from frozen hands?

[Blue_true]

13. I am more concerned about old people and poor people

than I am about gun-humping idiots that are freezing.

[Klaralven]

15. Just have them lick the barrel

[TheBlackAdder]

12. Huh, if Texas were a proper functioning state, their Board of Public Utilities would cap such abuses

[Blue_true]

14. Wait until customers see their next utility bill. nt

[Buckeye_Democrat]

16. That's criminal, as far as I'm concerned!

[KY_EnviroGuy]

18. Cue the calls for economic assistance to help pay utility bills.

ERCOT's refusal to buy reserve generation capacity like saying "don't waste you money on flashlight batteries or emergency food rations and blankets". "Just have fun and spend it all at Walmart on guns and Chinese shit".

And, cue the hundreds of Texas preachers and politicians making every excuse in the book.

Oh, and don't puke if someone mentions the word Enron......

Just occurred to me that this will be the Biden Administration's first new big emergency to deal with and I hope the previous one did not destroy all the things he needs to respond efficiently.

KY.......

[LeftInTX]

19. All the Republicans are blaming Biden and "New Green Deal"

I know, I know....


But that's what they're doing....I'm only the messenger..

[greenjar_01]

20. Texas specifically has an independent, non-federal jurisdiction power grid, and everybody knows it

Hard to blame the federal government for power problems when you proudly proclaim power independence as a kind of state mantra.

The Texas power grid is independent of federal authority, by design. They did it to themselves.

[LeftInTX]

22. They don't care, they say whatever they want to say regardless whether it is true or false

[coti]

21. That's $9 per kwh.

Which is far, far beyond absurd. The average house uses 30-40 kwh per day (so this would be $270-$360 per day in electricity). A house can also use much more power than that in winter, depending on its heat source.

[sarcasmo]

23. Leave Now unless you want a high bill, WTF?

https://www.dallasnews.com/business/energy/2021/02/16/electricity-retailer-griddys-unusual-plea-to-texas-customers-leave-now-before-you-get-a-big-bill/

[LeftInTX]

24. Paywall, can't even read the first line..can you copy the first four paragraphs please?

[sarcasmo]

25. Below

Snip < “We made the unprecedented decision to tell our customers — whom we worked really hard to get — that they are better off in the near term with another provider,” said Michael Fallquist, chief executive officer of Griddy. “We want what’s right by our consumers, so we are encouraging them to leave. We believe that transparency and that honesty will bring them back” once prices return to normal.

[LeftInTX]

26. Thank you!

[Demovictory9]

28. if this were California, we would be getting bashed for mismanagement