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Isolated Texas Electric Grid Could Add Links

Texas' electric grid prefers to stay isolated from the rest of the nation. But proposals are afoot to boost outside ties — something that proponents say could help ease the state's looming electricity crunch.

ETT Variable Frequency Transformer in Laredo.

Last summer, when the brutal heat strained Texas’ electric grid and increased worries about blackouts, the grid imported a modest amount of power from Mexico and elsewhere in the United States.

“It obviously helped,” said Dan Woodfin, the director of system operations for the Electric Reliability Council of Texas, or ERCOT, the grid operator. Those electricity imports amounted, on some August days, to nearly the equivalent of a nuclear reactor’s output, or enough to power more than 200,000 homes in the summer.

The Texas electric grid is proudly isolated. While most other states operate on a pair of grids that serve the eastern and western halves of the country, Texas has evolved on its own, in order to keep federal regulators at bay.

But occasionally, like last summer, the Texas grid leans heavily on the few links that connect it electrically to the outside world. Experts say that closer ties with other grids could be in the state’s future, even when no crisis is brewing, though state officials do not want too many ties for fear of triggering federal oversight.

“More people are looking at projects and proposing projects than we’ve seen in the past,” said Mark Bruce, a principal at the consulting firm Stratus Energy in Austin.

One of those proposals is for an approximately $2 billion New Mexico facility called Tres Amigas, which would tie together the three grids in the lower 48 states. Phil Harris, the project's chief executive, said that he planned to break ground in August on the tie between the eastern and western grids; the Texas one would come later. 

Another proposal, known as Southern Cross, would involve building a transmission line capable of transferring enough electricity for hundreds of thousands of homes between East Texas and Mississippi, where it could hook into big markets like the Tennessee Valley Authority. The project, to be financed by private investors, could cost close to $2 billion, according to Chris Shugart, the director of asset operations and maintenance for Pattern Energy, the developer.

The Texas grid covers about three-quarters of the state’s land area but excludes the Panhandle, El Paso and parts of East Texas. It already has links to other grids. Five “direct current” ties, including three to Mexico, can handle 1,100 megawatts, about 1.5 percent of the grid’s peak-time capacity. The ties can go both ways, though ERCOT has the authority to end the export of power during a crisis (Indeed, the ties provided nearly full power at points during last summer's power crunch.) Even in January and February, when there was no crisis, the ties provided roughly 1 percent of ERCOT’s power.

"We're not entirely separated from the rest of the country, but we don't have the capability to move significant amounts of power seamlessly," said Calvin Crowder, president of Electric Transmission Texas, which is related to a power company, AEP, that operates some of the "direct current" ties, including one in Laredo.

In addition, three power plants operated by a Nebraska-based company called Tenaska, including one plant deep in Oklahoma, can switch between providing power for the Texas grid and the eastern grid. The plants sell their power to big companies like Shell and Exelon, which decide where to send the power at a given moment. They were built at extra cost, with special controls and equipment to be able to switch between grids.

"It's not like you can just take any plant and say, ‘Oh, we're going to make it dual grid today,’" said Todd Jonas, Tenaska’s vice president of operations. Even within a plant, some generation units can be sending power to the eastern grid and others to ERCOT at the same time, he said.

Planners of a proposed electricity-storage facility in the Panhandle, which would compress air with surplus energy and then decompress and release power when it is needed, have also envisioned being able to serve both grids.

Texas can also offload some cities to other grids, in a crisis. Presidio, for example, can switch to the Mexican grid if needed, and other cities got connected to the eastern grid in the wake of Hurricane Rita in 2005. The city of College Station is trying to connect Ercot to the eastern grid through a new transmission line so that in emergencies like hurricanes Ercot can switch feed electricity into the eastern grid.

Even without hurricanes or other such drains on power, however, the Texas grid is still struggling. It faces rapid population growth, and low electricity prices are discouraging investment in power plant construction. A national report last year warned of “significant concerns” about ERCOT’s future capacity. Both Tres Amigas and Southern Cross, which have touted their ability to export Texas wind power, are now highlighting their ability to provide Texas with extra juice.

"This line can flow in either direction," Shugart said. "Those days ERCOT is struggling, I would fully expect that it would be importing power into Texas." He noted that the weather, and hence the electricity demand, can be quite different in the southeast than in Texas, at a given time.

Harris, of Tres Amigas, said that his project could have helped during the deep freeze of February last year. Utilities in the Texas Panhandle, which is not in ERCOT, had plenty of capacity, but "no way to get it into" ERCOT, he said.

Because of the Texas grid’s isolation, the proposed projects face a key hurdle: They must get a waiver from the Federal Energy Regulatory Commission that essentially states that the project would not trigger federal oversight of the Texas grid — something state officials want to avoid. Southern Cross got an important approval last year, and Tres Amigas plans to file this year for a FERC disclaimer of jurisdiction over ERCOT, according to Harris, the chief executive. 

“There’s no way we would support any of those if we didn’t have commitment from FERC that it didn’t threaten our jurisdiction,” said Donna Nelson, the chairwoman of the Texas Public Utility Commission. She noted that the projects are years away, if they get built at all, and she said that she has "always been a little leery in believing that [such projects] wouldn't cause a problem with FERC."

“We are moving forward to solve our potential challenges by ourselves,” Nelson said.

Editor's note: An earlier version of this story incorrectly stated that College Station would be switched to the eastern grid in emergencies like hurricanes. In fact, the idea is to feed Ercot power into the eastern grid, if the latter gets damaged by a hurricane.

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