Blazing heat and a comparatively robust economy have driven up power demand in the Lone Star State enough to move the Electric Reliability Council of Texas (ERCOT) to contract for power from four mothballed gas-fired generating units.

To support short-term contracts with ERCOT for peaking power, NRG Energy and Garland Power and Light will return two gas-fired units each, for a total of 400 MW, to be available if needed through October to reduce the risk of rotating outages across ERCOT.

“This has been a highly unusual year for ERCOT with record-breaking temperatures — starting as early as May — plus an increasing demand for electricity as the state’s economy and population growth fuel greater energy use,” said ERCOT CEO Trip Doggett. “In addition, we are facing the worst drought in Texas history. Without rainfall in the near future, we anticipate increased generation outage rates because of power plant cooling water issues,” Doggett said.

Not surprisingly, natural gas advocate America’s Natural Gas Alliance (ANGA) praised the move by Texas to lean more on gas to help get it through the summer.

“…[I] it is important for all Texans that we look to scalable generation that can be brought to market quickly and burns cleaner than other leading energy sources,” said ANGA’s David Blackmon, Texas state lead. “So this is a smart interim decision to bring gas plants back online to accommodate immediate needs. Over the long term, the addition of new high-efficiency gas-fired generation can and should be prioritized to help meet the state’s growing energy needs in a reliable and economical way using this abundant Texas resource.”

The temporary power contracts are based on the pricing methodology used for reliability-must-run units under ERCOT market rules. The payments will be figured on a cost-recovery model, meaning the owners get paid for their fixed costs — staff, maintenance, etc. — as well as a cost for fuel. To minimize the impact of this temporary reliability tool on other market participants in the competitive market, the four units will be called upon only when necessary to avoid emergencies so the units will not displace units that are online and bidding into the market, Doggett said.

“We don’t know if, or how much, these units will be needed, but if needed, the cost will be minor when divided by the 23 million consumers in the region and when compared to the much higher costs and problems from statewide rolling blackouts which these units will help avoid,” Doggett said.

According to the National Weather Service, high temperatures in Houston were expected to be around 100 through at least Tuesday. Highs in Dallas were forecast to be around 103.

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