The rapid buildout of energy storage in Texas — increasing roughly tenfold in three years — played a key role in helping avoid power shortages and brownouts this past summer amid record power demand.
Texans endured months of extreme heat this past summer and set new records for electric demand in the process. But unlike extreme weather events in the past, the state has been able to avoid the power shortages and brownouts that Texas Public Utility Commission Chairman Peter Lake had warned of. The rapid buildout of battery storage has played a key role in keeping Texas''s lights on.
In 2021, historic winter storms in Texas turned fatal in part because they created widespread power outages. Four million people lost heat and water access when the grid failed. As generators stayed offline, the price of power skyrocketed, causing additional pain for consumers. To avoid a repeat of this tragedy, Texas needed to add additional electric capacity that could deliver on a moment''s notice and stabilize the grid. That''s what batteries do best.
In less than 3 years, energy storage capacity in Texas has increased roughly tenfold and the grid held up throughout this past summer''s heatwave. With more than 3,000 MW of battery storage online, ERCOT was able to call on batteries to keep the lights on when power plants tripped offline or forecasts went wrong. And this grid stability meant that major price spikes were less common and shorter lived, making it easier for Texans to pay their electricity bills.
For example, in mid-August, a 1.8 GW discharge from batteries into the grid quickly reduced wholesale electricity prices from $5,000 to $2,700 per megawatt hour. Without energy storage, that kind of generation loss would have likely caused outages to spread across the region and kept prices maxed out for much longer.
As a Houston resident who''s helping operate some of Texas'' leading battery storage facilities, I''m proud to see batteries are making a difference here. And I know that the example we''ve set in Texas can be applied across the country throughout the entire storage industry.
For example, storage operators in ERCOT got a crash course in navigating volatile times this summer. We faced price caps, market watches, energy conservation notices, Responsive Reserve Service deployments, ERCOT Contingency Reserve Service deployments, and an Energy Emergency Alert event, while setting new records for demand. These challenges tested a wide variety of scenarios and showed that storage will play a big role in electric reliability, not only here in Texas but across the U.S. in places facing similar levels of demand.
Electric grids all over the U.S. are following some of the same trends as Texas. Aging fossil fuel plants are retiring, more variable wind and solar resources are coming online, and extreme weather is increasing power outages and pushing demand to new heights. All of this calls for more energy storage that can quickly and safely stabilize our grid.
Energy storage technology is revolutionary. This is the first time in history that humans can efficiently store a previously unstorable commodity — electricity. And we are just beginning to tap into the ways that energy storage can benefit our communities. Storage technology is improving year over year and making major improvements in areas like monitoring, temperature control and duration efficiency. Developers are combining better technology with market strategies to open up more options to participate in a variety of electric markets and offer maximum benefits to the grid.
Storage operators are collaborating with regulators to determine the role storage will play in the future of our electric system. For example, in ERCOT working groups, companies helped regulators understand state of charge management and improve their ancillary services guidelines. With that kind of collaboration, storage can help mitigate some of the biggest risks facing our communities.
Given these benefits, it''s no surprise that the energy storage industry is poised for massive growth. The key to creating more success stories will be to focus strategic development in the areas of the grid where storage solves problems and use real world experience to improve technology, markets and development.
Correction: This story has been updated to correct the amount that wholesale electricity prices dropped in ERCOT last August after a 1.8 GW discharge of batteries.
The three Texas facilities will increase by approximately 67% the capacity of Intersect Power''s storage portfolio, which currently includes two solar-plus-storage facilities in Riverside County, California: 448 MWh of storage at the 310-MWp Athos III solar farm and 1 GWh of storage at the 678-MWp Oberon plant.
Intersect Power''s website shows four standalone solar projects and two solar-plus-storage facilities in development, all in Texas or California. The company announced in November 2019 that it would sell a five-facility, more than 1.7 GW solar portfolio to a SoftBank subsidiary, according to S&P Global.
The Texas financing package announced Wednesday comprises two distinct transactions totaling $837 million, Intersect Power said. Participants include Morgan Stanley, which is providing tax equity; HPS Investment Partners, which is providing construction and term debt; and Deutsche Bank, which is partnering in the construction debt facility and providing operational letters of credit.
The three new installations will store power generated by Intersect''s already-operational 640-MW Lumina and 320-MW Radian solar facilities. Each new storage facility will comprise 86 Tesla Megapacks, and the Radian and Lumina II installations will be operated by Tesla''s real-time energy trading platform, Intersect said.
The Texas energy storage market has seen rapid growth in recent years. Texas, California and Nevada accounted for 90% of the nearly 1 GW in utility-scale storage capacity added in the U.S. in Q1 2024, according to a June report from the American Clean Power Association and Wood Mackenzie.
The Electric Reliability Council of Texas grid, which serves most of the state''s population, now has approximately 4 GW of storage capacity. This could grow to 8.4 GW by the end of 2024 and 20 GW by 2035, Aurora Energy Research said in May.
Battery installations in ERCOT territory benefit from a combination of deregulated energy markets that offer attractive energy arbitrage opportunities and payments for ancillary grid services. Reuters reported in May that storage developers in the region increasingly favor facilities with 2-hour discharge durations, like Intersect Power''s three planned projects.
"Texas is one of the most interesting markets in the country for renewables [because] it has excellent land and solar resources, rapidly growing energy demand and a relatively deep and liquid power market," Kimber told Utility Dive. "If you''re a developer with a strong trading and risk management function, utilizing more sophisticated offtake arrangements and looking to develop only the largest assets in the country, it''s an ideal market."
Most of Intersect''s planned and operational facilities are solar, storage or solar-plus-storage, but the company has at least one green hydrogen project under development. That facility, known as Project Meitner, will feature 340 MW of solar and 460 MW of wind co-located with a 400-MW hydrogen electrolysis plant in Gray County, Texas, according to a company presentation.
As the brutal heat wave in Texas continues, Electrek spoke with Julia Souder, CEO of the global nonprofit Long Duration Energy Storage Council and chair of the Global Renewables Alliance, about how big battery storage is helping to keep the Texas grid online.
Texas is experiencing another historic heat wave. Solar, wind, and batteries are critical for keeping the lights on by providing the power, flexibility, and stability to keep the grid running effectively.
In recent weeks, the ERCOT energy grid has seen a peak in demand, from the drawing down of 81,000 MW of power, surpassing the previous record in winter 2021. However, unlike those winter storms that left millions without power, the grid in Texas has not yet had a blackout because of the recent scaling of renewable energy and energy storage that provides clean power as gas and coal plants were taken offline.
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