Explaining Texas: Frigid Conditions Tax All Parts of Energy System

Mark Green
Posted February 18, 2021

More than 4 million Texas homes and businesses have been without electricity this week as an Arctic air mass left the state coping with temperatures hovering around zero. Electricity and natural gas use spiked and rolling blackouts were ordered as energy systems experienced what the Webber Energy Group’s Joshua Rhodes called a “black swan event” that taxed all parts of those systems at the same time.

I spoke with Dustin Meyer, API vice president of Natural Gas Markets, to find out what happened in Texas, to understand the conditions that left the nation’s No. 1 energy state struggling for power and heat and what resources could help prevent this from happening again.

Bottom line points:

• Texas’ difficulties represent a failure of the grid across the board, with all generation technologies falling short of expectations.
• As in California last summer, events in Texas underscore the need for a diverse energy supply and smart planning to support the health of the U.S. power grid.
• Natural gas, unique among energy sources in supplying needed attributes that ensure grid reliability, is and will remain a key in that diverse mix.
• Natural gas has carried most of the energy load in Texas this week, and without its contributions the energy picture would have been even worse. Expanded infrastructure would help make natural gas systems more resilient.

What led to the rolling blackouts in Texas?

Meyer explained that electricity is used to heat about 60% of Texas homes, with the other roughly 40% of homes heated by natural gas. Electric-based heat isn’t unusual in southern states because frigid conditions like those in Texas are incredibly rare, as is the need for prolonged home heating using electricity. Texas actually has a uniquely diverse power generation portfolio – on an annual basis, it gets about 40% of its electricity from natural gas, 25% from wind and the rest from coal, nuclear and, to a lesser extent, solar.

In that context, freakishly low temperatures drove up heating demand to record highs in Texas and with it, demand for electricity. The cold front that has covered Texas saw temperatures fall to levels not seen in decades, according to Weather.com. It was 16 degrees on Monday in Houston, the coldest temperature there since 1989. It was minus-3 degrees on Tuesday in Tyler, tying that city’s all-time low set in 1930. It’s a nearly unprecedented cold blast that has gone on for five days, and that’s the root of the crisis that has left people without power. Meyer:

“Complicating this is that fact that in Texas about 60% of heating is electric, which contrasts with traditionally cold regions like the upper Midwest or New England, where electric heating is somewhat rare. But the 60/40 mix means that the weather-driven surge in heating demand drives a massive increase in demand for both electricity and natural gas for residential use. These two record-breaking dynamics occurring simultaneously and stacked on top of each other is key to what put the grid in such a perilous situation. In a situation like this, total energy demand is so massive that everything needs to function perfectly. Unfortunately, this didn’t happen, and unexpected generation outages – covering all technology types, with many causes – eventually meant power supply fell short of demand, which ultimately led to blackouts.”

Why did generation fall short?

Again, keep in mind how deep and unexpected the demand surge was. Meyer said the Texas grid operator, the Electric Reliability Council of Texas (ERCOT), regularly examines a number of worst-case scenarios to guide system planning and to ensure there will be enough supply to meet demand. These scenarios include a wicked winter storm like what Texas is experiencing.

But ERCOT’s study suggested that even in the most extreme winter scenario, “peak demand” would max out at 66 gigawatts (GW). Meyer said that’s a huge demand number when in a normal year, peak demand on the single coldest day of winter reaches only about 55 GW., This past weekend, he said, demand appears to have peaked at a whopping 70 GW. Meyer:

“Even if generation stayed online as expected, the power grid would’ve been in very perilous territory because of just how extreme, widespread and long-lasting the weather conditions were.”

Further, Meyer said, not all generation technologies have the same operational expectations for such severe conditions. In what amounted to hyper-wintery conditions for Texas, he said, generation from wind and solar quickly plummeted heading into the weekend, affecting energy output from those technologies (chart below). Meyer:  

“This was expected, and to some degree was baked into the worst-case scenario analyses. Widespread freezing rain reduced the operability of many wind turbines and overcast conditions obviously limited solar output. Natural gas generation quickly surged to fill the void, then continued increasing to meet the dramatic increase in demand while coal and nuclear held constant.”

 

As seen above, for the first few days of the cold front, the power system functioned successfully, with natural gas meeting about 60% of power generation, followed by coal and nuclear, then wind and solar. But by Sunday, with temperatures plunging even further and demand rising rapidly, a number of natural gas, coal and even nuclear units started going offline.

Most units remained online and by historical standards, generation – especially from natural gas – remained quite high, Meyer said. But by Sunday, those unexpected outages, combined with low wind and solar output, meant total supply could no longer meet demand and the power outages began. Since then, he said, the focus has been on bringing as many units back online as quickly as possible, but the persistently frigid conditions have made this difficult, resulting in outages extending through Monday, Tuesday and into Wednesday.

Why did some natural gas-fueled power plants go offline?

The parts of an energy system are designed to be connected and communicate with each other, Meyer said. That’s a power system, generating electricity, and a natural gas distribution system. They’re meant to meet anticipated peak demand and then a little more, as a hedge. While there’s much uncertainty about what happened, Meyer said a combination of possible scenarios probably led to most of the natural gas outages:

• First, at some plants – especially those further north, where temperatures fell below zero – it’s possible that many instruments and mechanical components actually froze, deactivating them and making it impossible to keep the plant online, or at least prevent it from operating at full output. In colder regions of the country, power plants of all types take steps to weatherize to ensure full operability even in the coldest conditions, Meyer said. Some plants in Texas appear to have done this but probably not all.
• A second possibility is that natural gas was diverted from power plants to deliveries directly to homes and businesses through the natural gas distribution grid. Again, while 60% of heating demand is met by electricity, the remaining 40% is met by natural gas. Last Friday the Texas Railroad Commission, which oversees state energy, ordered that natural gas service to homes, hospitals, churches and other ‘human needs customers’ be prioritized over deliveries to power plants, which is typical in other regions of the country under such weather conditions. This may have been further exacerbated by the impact of production losses, including in West Texas due to freeze offs, he said, but the full impact of this is highly uncertain.

Meyer:

“This is actually a very important point because this represents another enormous pull on natural gas. Gas demand in the residential/commercial sector almost certainly hit a record high and by all accounts, I’m not aware of too many outages on the gas distribution side. And at least anecdotally, you’ve seen a number of stories about this, about how if you had natural gas heating in your home, you may not have had power, but you stayed warm and maybe even ended up hosting some neighbors for a few days.

“Regardless, the understandable decision of prioritizing residential customers may, in some instances, have made it more difficult for gas power plants to access fuel. It’s impossible to say right now how much of an issue this was, but surely, the task of simultaneously meeting record gas demand in both the power sector and on the residential side is a real challenge and that perhaps contributed to some gas power plants reducing output.

“Again, in addition to meeting residential heating demand, a lot of gas generation capacity remained online and appears to have been running at very high rates. But the units that were forced offline, combined with lower output from all other generation technologies, still left too much of shortfall to fully meet power demand.”

Noteworthy is what's happening in natural gas markets. As of Feb. 17, natural gas production in the U.S. South Central Region was down approximately 10 billion cubic feet per day (Bcf/d), or about 45% from the previous week, due to wellhead freeze-offs and natural gas processing plant outages caused by extreme cold. Although production losses due to freeze-offs are temporary, output takes time to return to normal levels, and the cumulative reduction over several days could be substantial, according to the U.S. Energy Department's Amber report.

Was demand from elsewhere also a factor, or was this specific to Texas?   

Meyer said he doesn’t think energy demand from other parts of the country was a big factor. Rather, the situation in Texas was simply so unprecedented. Also, according to RBN, a downturn in production could be partly due to water in "wet" natural gas freezing and valves and other electronics being without electricity.

Otherwise, planning for peak energy demand in Texas is usually focused on the summer, when on the hottest days air conditioners push peak electricity demand, not in winter.

Meyer said energy demand – especially natural gas demand – has been high across the country for the past week, as the cold front affected much of the Lower 48. He said it’s likely the U.S. set new records for daily natural gas demand last weekend. Through the combination of production, gas from storage (which always plays a major role in meeting peak winter demand) and the country’s extensive pipeline network, demand elsewhere was largely met without issue. Meyer:

“But this was a very difficult situation for Texas, and hard to plan for. After all, in Texas, peak power demand is actually typically in the summer. There's usually a handful of extremely hot days in August where air conditioners are cranked and the whole grid just kind of white knuckles it through really high demand. That’s what the ERCOT system is planned for: summer peaking. The system is not really designed to assume that peak electricity demand actually occurs in February. In fact, if you had told ERCOT that, oh, you know what, in the middle of February, it's going to be so cold that we're going to have peak demand for power, and we're going to have peak demand for natural gas for five consecutive days, people would have been like, well, that's probably not going to work. And it didn't work.

“This is just such a black swan event that at every level, for every generator type, it really does make it hard to plan for. But clearly, there needs to be—and definitely will be – a lot of analysis of what exactly happened, what worked, what didn't work, to make better plans going forward and ensure this never happens again."