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As electric demand continues to grow in much of Texas, the Electric Reliability Council of Texas (ERCOT), grid operator for most of the state, expects Texas transmission providers to complete improvement projects totaling $8.9 billion by the end of 2017.

ERCOT has also announced the release of the Long-Term System Assessment report, which provides an assessment of system needs over the next 10 to 20 years, as well as the Electric System Constraints and Needs report.

"As we see the gap between available generation and peak electric demand become tighter over time, it becomes increasingly important to deliver new power resources to the grid as quickly, reliably and cost-effectively as possible," says ERCOT CEO Trip Doggett. "These studies help ERCOT, transmission providers and market participants plan ahead so we can prepare effectively for changing grid and market conditions."

Current and near-term challenges

ERCOT expects transmission congestion in the Houston area this year because some paths used to deliver power to the area will be out of service while they undergo improvements. In other areas, growing demand and construction-related outages could result in high levels of congestion on 17 different circuits. Congestion could affect the cost of power in the affected regions as generation from less efficient resources is used in those areas along alternate pathways, ERCOT explains.

In the next few years, a primary priority is to address constraints that have resulted from increased oil and gas exploration and production in West and South Texas. ERCOT says this growth has affected power demands both in the Permian Basin region of West Texas and the Eagle Ford Shale area in South Texas.

Another priority region is the Lower Rio Grande Valley, where there are only two high-voltage circuits to carry power into the growing region. Two projects scheduled for completion before the summer 2016 peak season will improve the capability to import power into the region and serve growing electric demand in the Brownsville area.

A long-standing constraint between West Texas, where most of the state’s wind generation is located, and the North Texas region, which includes the Dallas-Fort Worth area, is expected to be resolved by the end of 2013 when the state’s Competitive Renewable Energy Zone (CREZ) projects are completed. However, with more than 20 GW of new wind power currently being studied, new constraints could occur in future years, particularly in the Panhandle region.

Preparing for the future
The Long-Term System Assessment looks beyond the five-year ERCOT stakeholder planning horizon, evaluating a range of possible scenarios that could affect the types and locations of generation resources, as well as consumer energy use patterns. Although Texas law requires ERCOT to provide a 10-year analysis, a grant funded by the U.S. Department of Energy has enabled it to expand that assessment to a 20-year planning horizon.

The results indicate that the following resources likely will be needed within the next 10 years:

- At least one path to import power into the Houston region, as ERCOT says regulatory requirements will limit development of new generation within that region; and

- An additional circuit to carry more power into the Lower Rio Grande Valley (unless more generation resources are developed there).

Within the 20-year study period:

- Potential retirement of older natural-gas-fired resources in urban areas could necessitate more transmission facilities within the Dallas-Fort Worth and Houston regions to support capacity and voltage stability;

- Natural gas and renewable generation resources are likely to be competitive in a variety of scenarios, and significant growth in renewables may require ERCOT to study the need to integrate more variable generation that cannot sustain consistent output;

- If market factors result in significant growth in renewable resources, it may become cost-effective to develop higher-voltage transmission solutions to connect those resources to areas where electric consumption is high; and

- Although there should be sufficient water resources to allow operation of existing and future power plants in an extended drought, those conditions could lead to increased power plant development in eastern Texas where more surface water is available.

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