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The Historic Failure of Electric Generators

UT ECE professor Ross Baldick recently addressed the historic failure of electric generators and recent rolling blackouts associated with ERCOT.

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Before our state's recent experience with rolling blackouts, little public attention was paid to the Electric Reliability Council of Texas. But with an unprecedented number of people losing power Feb. 2, this nonprofit company charged with monitoring, operating and controlling the state's electricity grid has found itself the subject of glaring attention from public and politicians alike. We are all asking: Did ERCOT prepare responsibly and do its job during the electricity crisis?

As the inquiries have demonstrated, there is a broad misunderstanding of what the ERCOT independent system operator actually does.

ERCOT does not sell electricity to consumers. That is the job of retailers. It does not produce electricity. That is the job of the generation companies, which are responsible for proper functioning of their equipment. ERCOT does not deliver electricity to consumers. That is the job of the distribution companies.

The ERCOT system operator does control the flow of power on the transmission system — known as the grid — that moves power from the generators to the distribution companies so that it can be delivered to consumers. The ERCOT system operator's mandate from the Public Utility Commission of Texas is to balance electricity supply to electricity demand so that consumers are provided with nonstop power.

To maintain this balance between supply and demand, ERCOT must plan in advance (based on its best ability to predict) how it will respond to a variety of possible scenarios, including the failure of generators. ERCOT copes with a failure of a generator by having other generators ready and immediately available to step in to cover that gap.

ERCOT is responsible for making sure these reserves are available at any given time. Without such reserves, the failure of only a single large generator would result in a complete statewide blackout in less than a minute. Overnight on Feb. 2, more than 50 generators failed, taking out around 10 percent of the total generation capacity in the state.

This massive set of failures exceed the amount of capacity that would typically fail in a single day. Historically, it is a very rare event for more than two generators to fail in a single day. Even with ERCOT's reserves, there was insufficient generation available to meet consumer demand. Under these circumstances, what results is either a complete statewide blackout or rolling blackouts.

As long-standing policy dictates, ERCOT ordered the rolling blackouts to avoid a complete statewide blackout, aiming to minimize consumer interruptions. While the rolling blackouts were unpleasant, they were a very small inconvenience compared to the kind of widespread blackout that paralyzed the Northeast United States in 2003.

There are obvious questions to be asked: Should ERCOT have anticipated and planned to have sufficient reserves for this unprecedented level of generator failure? The less obvious, but crucial, questions are: How much would it cost consumers to have increased reserves? Does it make sense for consumers to pay for the cost of reserves to avoid interruption for extreme, once-in-a-decade scenarios?

As for the obvious question, no system operator could have foreseen such an extraordinary set of failures in such a short period of time. The predictive models used by system operators across the world are based on independent generator failures, not the kind of systemic failure that occurred that day.

As for the less obvious questions: It would cost approximately $3 billion to build the 4,000 megawatts of additional generation needed to have avoided the rolling blackouts. That's a $300 million-plus annual cost to Texas consumers.

Given the radically diminished supply that ERCOT faced on Feb. 2, I believe that the system operator managed to minimize the disruption to consumers. Looking ahead, policymakers need to decide whether it's a prudent decision to charge consumers another $300 million per year to increase reserve levels to prevent once-in-a-decade rolling blackouts.

Ross Baldick holds the Leland Barclay Fellowship in Engineering and is a professor in the electrical and computer engineering department at The University of Texas at Austin. ERCOT supports research by Baldick and his students, but Baldick is solely responsible for this commentary.