Following a Dallas Regional Chamber presentation, Pablo Vegas talks about handling new electrical demand as tech and industrial companies move into Texas.
ERCOT CEO Pablo Vegas speaks in Dallas to address state’s growing needs
Vegas believes ERCOT is up to the task of providing enough power for residents and citizens.
ERCOT CEO Pablo Vegas says there is room on the Texas power grid for bitcoin miners, data centers, a growing population and increasing temperatures, but the state’s electric infrastructure will need a boost and batteries to overcome demand at peak periods of use.
“We are on the precipice of a new era of growth that’s coming to Texas and I think we’re very well positioned to meet that growth,” Vegas, leader of the Electric Reliability Council of Texas, said in an interview with The Dallas Morning News after a speech at the Dallas Regional Chamber’s State of Infrastructure conference.
“We’ve got the resources here, the right kind of a market to support it, the talent and all the pieces and parts,” he said. “When you put that together, you’re going to be able to create the infrastructure we need to be able to meet that incredible growth ahead of us.”
To Vegas, Dallas is indicative of what the rest of Texas’ big cities look like in terms of energy demand. Though it will be a lot to handle in the coming years, he’s not looking to stop companies from calling Texas home as long as it doesn’t overwhelm the grid.
“Dallas is reflective of kind of what Texas is to the United States. It’s one of the fastest growing economies in the state and it has the potential to keep growing at a pace that probably outpaces most of the U.S.,” he said. “Because of that, we have to make sure that we look here and across the state to make sure that there’s adequate resources to meet that demand that’s growing so quickly.
“We don’t want to do anything that would ever prevent the economic miracle that continues to be the Texas story from changing direction. Here in Dallas, it’s just as important as anywhere.”
What is ERCOT predicting for this summer? How will it support businesses, residents?
Summer has entered into its hottest stretch and residents may assume that it’s the most stressful factor to the grid. But it’s actually not, Vegas said.
Instead, 8 p.m. to 9 p.m. has become the toughest time for the grid due to the state losing out on between 15,000 to 16,000 megawatts that solar energy provides. To make up for it, ERCOT has begun closely working with battery operators that can store power when it’s needed the most, Vegas said.
“We’ve started to see batteries really stepping up during those solar ramps at the end of the day, helping to give the power that we need in order to keep the grid reliable,” he said. “So [what] we’ve been really working on is ensuring that we get those batteries connected to the grid quickly to ensure that they can continue to come and develop in Texas.”
But that’s not enough. With ERCOT predicting a 16% chance of an electrical grid emergency and a 12% chance of rolling blackouts in August, Vegas wants to see more participation from other energy sources, he said.
“It’s important that we supplement the batteries and the renewables that are coming with long duration, traditional dispatchable resources like natural gas,” he said. “Because each of those types of sources of generation brings something unique to the grid. And we need all of them in order to meet the demands and the reliability that people expect.”
What about crypto miners and data centers?
Texas has become one of the crypto mining capitals of the United States and perhaps the world. There’s more than 20 industrial-scale bitcoin mining operations in the state. In total, those facilities use approximately 2,300 megawatts of power per day.
That and the state’s 300-plus data centers means that crypto miners and data centers will be responsible for over half the growth of the Texas grid. It means ERCOT’s safeguards need to be strong to prevent a new company from overwhelming the grid, he said.
“When a big company wants to come to Texas, they have to work very closely with the transmission utility and with ERCOT to make sure that the grid can stably operate with them using power in the system,” he said. “So there’s a set of studies that have to happen. It’s fairly intensively engineered to make sure that when they do come online, we’re going to be able to serve them reliably. If we can’t, we won’t let them come online.”
However, residents have still voiced concerns over how much power crypto miners and data centers utilize. It’s especially more frustrating to some when companies, like bitcoin miner Riot Platforms last year, profit from not mining crypto and bitcoin.
Last year, Riot said it gained over $10 million through demand response credits, which is when ERCOT asks companies to dial back operations at stressful times for the grid and in return, the company receives the credit. At the time, Riot cut back on its power usage by over 95% during peak demand periods.
Where some are frustrated, Vegas sees an area to help bring citizens into the same boat and have them profit from demand response programs as well, he said.
“What I would say to consumers is there’s an opportunity to broaden those programs, so they can participate, too,” he said. “I think there’s an opportunity to help educate what the opportunity is and to incentivize getting smart thermostats more broadly distributed to Texans so that those who want to have a demand response involvement can have one. Some retailers are doing it. But we need to broaden that.”
To make his vision of expanding the demand response program a reality, ERCOT would need to work with the Public Utility Commission and find support through the state’s Legislature, he said.
“There is already support in the Legislature to have programs like this,” he said. “So it’s really the PUC working with us together to define what’s the right kind of program that we can bring more and more consumers into to help increase the amount of demand response available.”
What does the future look like for the Texas grid?
More companies and more people means that the grid is only going to be stressed more in the coming years.
By 2030, the state’s electricity demand is expected to nearly double, reaching approximately 150 gigawatts. It’s 40 gigawatts more than ERCOT previously forecasted.
Along with ERCOT’s new era of planning, Vegas said he thinks getting the grid ready to meet the growing demand is a step-by-step process. It’ll start with getting new technologies like dynamic line ratings, which would enable already existing lines to operate more efficiently based on real-time data.
“There’s a real opportunity to start implementing these kinds of technologies just on the traditional infrastructure to get more out of that,” he said. “But then, as we need to grow further, we’ve got to be thinking, how do we plan for the next set of infrastructure that has to come out.”
To do that, Vegas and ERCOT are reexamining the high-voltage system throughout the state. Currently, Texas operates at 345 kilovolts, but it’s possible the state could at some point reach somewhere between 500 kilovolts and 765 kilovolts if his work with entities like ONCOR and CenterPoint is successful.
“There are other higher voltages out there that would enable us to carry much more power much more efficiently and to do it in a way that will be more cost-effective for Texans,” he said.
Still, Vegas knows that the 2021 winter storm left some residents traumatized over the loss of food and even loved ones. Since then, ERCOT has added a dashboard on its website to help citizens stay up to date on the grid and is working more closely with the PUC and legislators to put more incentives in place to reel in more power supply.
But as the state continues to welcome more people and businesses to Texas, he and ERCOT will be looking to do whatever it can to keep the lights on and air conditioning going, he said.
“I understand completely that power is personal. After air and water, you’ve got electricity in terms of the commodities that are needed to support modern life, everybody needs power,” he said. “So I recognize that and understand that people are worried. So there’s a lot of things that are going on on multiple levels of managing and running them and supporting the grid, that are all focused on keeping the lights on, keeping the air conditioning and the heat running when we need it.”
“I want Texans to know that that is a focus every single day. It’s the primary most important thing that we think about when we think about running the grid.”
