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Dalia Faheid
Wed, July 20, 2022
Last week, the Electric Reliability Council of Texas asked Texans twice to set their thermostats to 78 degrees and avoid using large appliances during peak hours.
Predictably, the public was not happy about it, questioning why the grid operator wasn’t prepared for the summer heat and hasn’t employed other measures to manage the grid. What I set my thermostat at is none of ERCOT’s business, Texans responded with memes, tweets and comments.
With many Texans saying they would not set their thermostats to warmer temperatures, have the conservation appeals actually resulted in any energy reduction? And can conservation appeals help in the long-term to keep the grid reliable and prevent blackouts?
The Star-Telegram spoke with UT Arlington electrical engineering professor Wei-Jen Lee to get some insight into those questions.
What to know about conservation appeals
If the margin between available electric supply and customer use is too tight, ERCOT will ask customers to conserve — hoping to reduce demand and increase operating reserves.
ERCOT has issued more than 50 conservation requests between 2008 and July 2022. Those requests help reduce the amount of electricity being consumed on the grid only when needed, according to the grid operator. It’s used when projected reserves may fall below 2300 MW for 30 minutes or more.
“Conservation is an effective way to help balance generation supply and customer demand,” ERCOT said.
According to ERCOT it is managing the power grid more conservatively, issuing conservation requests sooner, to ensure that there is enough power.
“Our goal is to prevent potential emergency conditions from occurring on the grid,” ERCOT said. “Conservation does not automatically mean there will be an energy emergency — it is a tool used by ERCOT to keep the grid reliable for customers.”
The length of the conservation requests depends on how tight grid conditions are. They can range from hours on a single day to multiple days. The conservation appeal on July 11 was between 2 to 8 p.m. and the next on July 13 was 2 to 9 p.m. Just two months earlier, on May 13, six power plants went offline and ERCOT asked Texans to conserve between 3 and 8 p.m. through that weekend. Last June, a conservation request lasted for five days, from 3 to 7 p.m. each day. The longest request was issued during the 2011 heat wave, lasting eight days between Aug. 1 and 28.
Some cases require localized conservation to balance available supply and customer demand. In 2016, there was a localized request for conservation in the Rio Grande Valley.
To issue a conservation request, ERCOT works with the Public Utility Commission of Texas and state leadership. ERCOT also sends alerts to electricity market participants for conservation.
Do conservation appeals actually work?
Between 1:56 to 2 p.m. last Monday, after the conservation appeal was issued, almost 500 MW of load dropped off, an ERCOT spokesperson told the Star-Telegram. One MW can power about 150 to 200 homes, according to Lee. Each household’s load is about five to ten kW.
Aside from individual households and businesses, ERCOT also calls on large electric customers to lower their electricity use through demand response programs, which control thermostats of households that agree to it. If their load is 10 MW and they cut down 20%, or two megawatts, that represents 300 to 400 homes, which makes a big impact in reducing demand.
While conservation requests do result in substantial amounts of energy-reduction, Lee said, it’s not a tool that can be used too often to help manage the grid. The impact will get smaller and smaller, because people will not respond to the requests as much. That makes conservation an ineffective long-term solution, he said.
“If they appeal to the customer too often, the impact will kind of diminish,” Lee said. “That immediate impact will not be there, or it will be reduced.”
He likens the requests to time of use rates, which aim to get customers to use more energy while demand is low to reduce strain on the grid. Researching the rate’s effect on customers, Lee found that their response diminishes over time.
The few customers who opt for real-time pricing are motivated to cut down on unnecessary load to save money, while most customers, who have fixed-rate electricity plans, are not.
“The reason why ERCOT has to use this kind of appeal is because most of our residential customers, the price of electricity, it’s fixed,” Lee said. “So it basically doesn’t have the incentive for them to reduce the consumption. It’s always a kind of judgment call from the customer.”
ERCOT needs to incentivize those customers in some way to get them to continue participating in conservation events, he said, especially when they anticipate that there will be higher demand because of the weather. They’d have to figure out a way to track when customers cut down their electricity and compensate them, Lee added. Right now, ERCOT does not track how many people participate in a conservation event, a spokesperson said.
“It’s a lot of infrastructure that we have to modify,” Lee said. “We have to upgrade and then get the customer directly involved.”
One sustainable solution could be using smart meters for dynamic pricing, Lee says. If you use a certain amount of power, then the price will be fixed, but if you go beyond a certain threshold, then you have to pay the market price.
Currently, customers can save $2 to $3 by turning up their thermostats, but that may not be enough to endure uncomfortable weather.
“If you consider 15 cents per kilowatt hour as an example. You are using probably three kilowatt hours. So in one hour, you are going to spend 45 cents. If you consider six hours in the afternoon, you can save a little bit less than $3,” Lee said. “Are you willing to do that? That’s the question.”
By contrast, changing the time you do your laundry or wash the dishes may not be as much of an inconvenience.
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