Texas Energy Crisis Strengthens Case for Microgrids

Catastrophic events such as the one in Texas last week demonstrate the value of energy networks that include many small, distributed power systems to provide power when the larger network is unable to.  

Last week, as Texans increased their power usage to keep warm amid frigid temperatures from a severe winter storm, energy demand surged to unprecedented levels. At the same time, energy infrastructure statewide including generation assets, pipelines, equipment panels, and power plants failed under freezing conditions. Meanwhile, natural gas supplies dwindled and electricity supply diminished.

Texas grid operator, the Electric Reliability Council of Texas (ERCOT), suddenly found itself with 185 inoperable power plants and insufficient electricity to meet high demand. As a result, the state’s grid edged perilously out of balance. The only way to quickly reduce demand was for ERCOT to call for widespread outages.

During this brutal stretch of freezing temperatures more than 4.5 million customers were left without energy for extended periods of time and at least 20 deaths were reported as a result of what is now considered the worst energy shortage in the US since the 2003 blackout in the Northeast and Midwest.

The Texas energy crisis joins the ranks of other weather-related grid failures such as the one in Puerto Rico following Hurricane Maria or the Northeastern US after Superstorm Sandy. It also reinforces the need for the US to invest in resilient energy infrastructure and plan for future events that could disable the grid.

Bigger isn’t always better

Big grids are vulnerable. Cascading power plant failures can lead to catastrophic system failure as evinced by Texas’ grid crisis. Events such as this demonstrate the value of energy networks that include many small, distributed power systems, rather than one large plant that can collapse under strain. Microgrids can provide large systems with flexibility and a layer of insurance in the form of resilience, demand management, price management, and community support.

While small distributed systems that remain online when the main power grid fails can support their customers during a grid event, they can also help balance grid load through islanding and reducing demand or serving as an auxiliary power supply.  They can participate in demand response programs and provide ancillary services.

Dr. Lilienthal, the founder of HOMER Energy by UL and UL’s Global Microgrid Lead notes,  “The only way to guarantee truly high reliability is to locate the power generation at the place where it will be used. Large plants and interconnected networks can often provide less expensive power, but they will always be vulnerable to extreme events. Although this is simply an obvious physical fact, it was doubly true in Texas because their market  for energy lacked mechanisms to incentivize reserve capacity.”

Price management is another microgrid benefit underscored by recent events. Last week in Texas, wholesale power prices skyrocketed, driven by electricity shortages. During market fluctuations such as this, microgrid owners can earn or save money by providing grid services or by using on-site power from the microgrid to avoid the high costs of grid power.

More importantly, microgrids offer community resilience. Resilient power delivery is critical for a functioning society today. Without electricity, services essential for public health and safety no longer function at the capacity needed. From health care and emergency services to grocery stores and water supplies, cell phones, the internet and banking — nearly every aspect of society relies on electricity. Microgrid installations in community centers could reinforce energy infrastructure and strengthen distribution grids while providing potentially life-saving humanitarian support during emergencies.

Texas’ energy crisis makes clear the value of many small, distributed power systems to provide power where it is needed. It also serves as a powerful reminder that, as a nation, we need to increase our investment in grid resilience and plan for future events that could impact our energy infrastructure. The cost of ignoring this call-to-action incident could be catastrophic. 

UL Solutions HOMER Grid is a market-leading solar-plus-storage software tool for designing grid-tied distributed energy systems. With an integrated utility tariff database and a new module for electric vehicle charging stations, it optimizes peak shaving to help commercial and industrial utility customers lower their demand charges. HOMER Grid can model projects with wind and combined heat and power as well as islanded systems, helping users improve their resiliency. Explore your opportunities with HOMER Grid during a complimentary trial. Learn more and download your complimentary trial.