Energy Storage in Texas

Energy storage in Texas: with its solar and wind energy resources, plus favourable legislation, it could be the home of the oil boom, not California, that becomes the model to follow.
Energy storage in Texas: with its solar and wind energy resources, plus favourable legislation, it could be the home of the oil boom, not California, that becomes the model to follow. Photo credit: SolarWorld/Business Wire
Energy storage in Texas: with its solar and wind energy resources, plus favourable legislation, it could be the home of the oil boom, not California, that becomes the model to follow.

Energy storage in Texas: with solar and wind energy plus favourable legislation, could the home of the oil boom, not California, become the model to follow? Photo: SolarWorld

Texas. It has always been of huge and obvious importance to the US energy economy, both as a producer of hydrocarbons and as a massive consumer, thanks to its enormous geographical area and its position as a vital component of the US’s industrial heartland.Its huge and growing appetite for energy currently totals around 30,000GWh annually. Increasingly, that burgeoning hunger for more power is being met by sources of renewable energy.

Renewable energy in Texas

As a state, Texas is the wind power capital of the US, with 12GW of operational utility-scale wind capacity, which recently succeeded in generating 29% of total electricity load for the entire state, albeit for a brief moment. The usual figure averages around 9%.

A key element of Texas’s wind strategy was the recent completion of the CREZ project to connect windy, relatively unpopulated West Texas with the state’s urban centres.

Construction of new wind capacity is slowing, thanks to the termination of the Renewable Electricity Production Tax Credit at the end of 2013.

But the long-dormant solar industry is currently showing encouraging signs of progress, with the 150MW Recurrent Energy solar farm near Austin planned for completion in 2016, amongst others.

The Lone Star grid

Texans have a proud reputation of rugged individualism and the way the state goes about fulfilling its energy requirements reflects this spirit.

Largely run by the Electric Reliability Council of Texas (ERCOT), the grid is pretty much cut off from the rest of the country and tries its best to remain independent of it.

ERCOT buys electricity on behalf of Texan consumers, asking producers to bid every hour. The winning ‘merit order’ of the lowest-priced electricity features an increasing quantity of renewable generated power, thanks to its low operating costs.

Competitive pricing

Energy sources that do not have low operating costs are gas combustion peaker plants.

These may only be operational a few hours every year and, as a result, have to try and recoup costs by selling very expensive electricity when ERCOT has the choice to either buy high or watch the lights go out.

Clearly, there is an opportunity here for any technology that can provide an extra boost as needed, and can be ramped up more quickly than, say, a coal-fired power station, whilst being more cost effective than a peaker plant.

With the wild variation in input from renewable energy increasingly becoming an issue, one solution must surely be some form of grid-scale energy storage.

Guaranteed rights for storage

George Bush’s deregulation of the Texan energy market means that Texas has taken a very different trajectory to another state with a booming renewable sector: California.

The Sunshine State has mandated a minimum storage requirement for utilities, and Texas has not. Instead, it has passed Senate Bill 943.

This is a significant piece of energy storage legislation as it states that storage is given all the same interconnection rights as any other generation asset that is allowed to interconnect, obtain transmission service and participate in electricity markets.

Direct sales encourage electric vehicles

Power companies also sell direct to customers in Texas, which could be having a positive effect on that most un-Texan form of transport, the electric vehicle.

CPS Energy, NRG and Austin Energy are all involved in building electric vehicle charging stations, as a way of augmenting their revenues.

Partly as a result of this, Navigant Research’s Electric Vehicle Geographic Forecasts report estimates that Texas has around 5,000 registered electric vehicles currently and that this number will grow to nearly 100,000 by 2023.

Power generators also see the use of electric vehicles as mobile energy storage units that can help smooth out the peaks and troughs of the state’s burgeoning solar and wind capacity.

Recognising a need for storage

ERCOT has also realised the necessity of large-scale energy storage in Texas. Last year, the organisation published a white paper on the need to update ancillary services, including the requirement for significant investment in energy storage.

In fact, Texas already has over 450MW of grid-scale energy storage in operation right now or planned to go into service, and boasts Duke Energy’s 36MW Notrees Battery Storage Project, the largest battery energy storage installation in the US.

In order to build on this, ERCOT has entered into a relationship with the Energy Storage Alliance, while the Texas Energy Storage Association has now joined ranks with the national organisation.

Take California?

Other storage projects in the pipeline include a proposed Dresser-Rand 317MW compressed air energy storage facility in the Tennessee Colony of East Texas, with an expected cost of USD$200m.

Throw in the fact that there is a strong possibility Texas might host the much-anticipated Tesla Gigafactory and it could be the home of the fracking boom, not flower power, that becomes the model to follow for energy storage.

Written by Mike Stone

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