Commissioner says he's tired of Xcel's 'mess-ups'

By Associated Press


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Public Service Commissioner Kevin Cramer says he's tired of Xcel Energy's mistakes after hearing the company sent incorrect electric bills to about 5,000 North Dakota customers. A company official says Xcel is frustrated, too.

"We've had some of those same discussions," said Mark Nisbet, the principal manager for Xcel in North Dakota.

Xcel said it mistakenly did not include the minimum service charge for some billing cycles in November — which is either $5.50 or $7.50, depending on the service. The utility is seeking to cancel the current bills for the affected customers and issue new ones. It had considered notifying the customers using prerecorded calls.

Commissioners asked the company to wait while they check administrative rules.

The PSC said it is the third time in recent memory that Xcel has had billing problems.

"My patience is growing weary... and I just think there has to be a limit to how much of this sloppiness we're expected to tolerate — and certainly how much the ratepayers are expected to tolerate," Cramer said.

"This is a really big company and, quite honestly, I think the bigness of the company is part of the problem," he said.

Nisbet said the company will work with the PSC staff.

"We're disappointed too, and we're pledging to work with the commission to make sure we find a suitable answer," Nisbet said.

In September, Xcel Energy said it was replacing about 23,500 natural gas meter readers in Fargo, West Fargo and Grand Forks because many of them have malfunctioned. The PSC said the faulty equipment caused billing mistakes for about 4,400 Xcel natural gas customers in North Dakota last winter.

Nisbet said the latest problem happened when the company was analyzing changes in its billing system and it slipped into the actual production mode, affecting about 5,000 customers.

"It was caught fairly quickly," he said. "We have about 85,000 customers."

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Texas utility companies waiving fees; city has yet to act

Texas Utility COVID-19 Relief suspends disconnections, waives late fees, extends payment plans, and supports broadband access as electric, gas, and internet providers help customers during the statewide emergency with speed upgrades and student WiFi initiatives.

 

Key Points

Texas utilities pause disconnections, waive fees, expand access, and offer flexible payment plans during COVID-19.

✅ Disconnections and late fees suspended by gas, power, internet.

✅ Payment plans and deferred balances after emergency.

✅ Bandwidth caps lifted; student WiFi access for remote learning.

 

In response to the COVID-19 pandemic, Texas utility companies have taken unprecedented steps to keep customers' lights on, gas flowing, and online connections stable -- even if they can't pay, amid concerns over pandemic electricity shutoffs nationwide.

Meantime, Palestine City Council members plan to discuss hardship measures Monday, as some states such as New Jersey and New York implement moratoriums on shut-offs, but have no plans yet to ease the burden of paying two other essential services during the statewide emergency -- trash collection and water. Those services are billed through the city.

For many residents, money will be tight after the statewide emergency declaration. Businesses are cutting back or closing. Workers are staying home to avoid the coronavirus.

"We are putting our customers first," Larry Ball, spokesman for Atmos Energy, a Dallas-based natural gas company, told the Herald-Press Friday. "The safety of all of our customers has always been our first priority."

While the declared emergency remains in effect, Atmos has suspended all late fees and customer disconnections, a step similar to PG&E's shutoff moratorium in California.

"Atmos Energy's commitment to safety, paired with our culture, have led us during unique times," Kevin Akers, Atmos President and CEO said. "This will be no different."

Internet Service Providers SuddenLink and Centurylink have similarly suspended all disconnections and late fees. Additionally, Centurylink, a global company serving 36 states, has promised to scrap bandwidth limits, while ensuring the highest speeds possible.

SuddenLink, a division of Altice Business, is also partnering with school districts in their service area to offer its Student WiFi product free for 60 days. That will allow students who have school-issued devices, but no dedicated home Internet access, the ability to use the Optimum WiFi Hot Spot Network to access their school's network and resources.

Electric companies such as TXU and Houston-based Gexa Energy also are working to keep customers safe and connected, and Entergy's relief fund highlights additional support for customers.

During the declared emergency, Gexa is waiving all disconnection and reconnection fees, as well as late fees, a policy focus that later intersected with debates over a proposed electricity market bailout in Texas. Payment plans will be set up for customers, after the crisis ends, Gexa Energy officials said.

"Everyone needs their power on," a Gexa spokesman said. "That is our number one priority."

TXU, based in Irving, is waiving late fees, extending payment due dates with no down-payment required, and deferring customer balances over multiple installments, while some retailers like Griddy underscored the risks of variable-rate plans.

If customers still can't pay, TXU officials said, the company will keep their lights on, a commitment underscored after the Texas winter storm outages exposed vulnerabilities. Customers in need should call 800-242-9113.

"The coronavirus is causing uncertainty and many hardships," Scott Hudson, president of TXU energy, said. "We are committed to serving our communities."

 

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Hydro Quebec to increase hydropower capacity to more than 37,000 MW in 2021

Hydro Quebec transmission expansion aims to move surplus hydroelectric capacity from record reservoirs to the US grid via new interties, increasing exports to New England and New York amid rising winter peak demand.

 

Key Points

A plan to add capacity and intertie links to export surplus hydro power from Quebec's reservoirs to the US grid.

✅ 245 MW added in 2021; portfolio reaches 37,012 MW

✅ Reservoirs at unprecedented levels; export potential high

✅ Lacks US transmission; working on new interties

 

Hydro Quebec plans to add an incremental 245 MW of hydro-electric generation capacity in 2021 to its expansive portfolio in the north of the province, while Quebec authorized nearly 1,000 MW for industrial projects across the region, bringing the total capacity to 37,012 MW, an official said Friday

Quebec`s highest peak demand of 39,240 MW occurred on January 22, 2014.

A little over 75% of Quebec`s population heat their homes with electricity, Sutherland said, aligning with Hydro Quebec's strategy to wean the province off fossil fuels over time.

The province-owned company produced 205.1 TWh of power in 2017 and its net exports were 34.4 TWh that year, while Ontario chose not to renew a power deal in a separate development.

Sutherland said Hydro Quebec`s reservoirs are currently at "unprecedented levels" and the company could export more of its electricity to New England and New York, but faces transmission constraints that limit its ability to do so.

Hydro Quebec is working with US transmission developers, electric distribution companies, independent system operators and state government agencies to expand that transmission capacity in order to delivery more power from its hydro system to the US, Sutherland said.

Separately, NB Power signed three deals to bring more Quebec electricity into the province, reflecting growing regional demand.

The last major intertie connection between Quebec and the US was completed close to 30 years ago. The roughly 2,000 MW capacity transmission line that connects into the Boston area was completed in the late 1990s, according to Hydro Quebec spokeswoman Lynn St-Laurent.

 

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It's CHEAP but not necessarily easy: Crosbie introduces PCs' Newfoundland electricity rate reduction strategy

Crosbie Hydro Energy Action Plan outlines rate mitigation for Muskrat Falls, leveraging Nalcor oil revenues, export sales, Holyrood savings, and potential Hydro-Quebec taxation to keep Newfoundland and Labrador electricity rates near 14.67 cents/kWh.

 

Key Points

PC plan to cap post-Muskrat rates by using Nalcor revenues, exports, and savings, with optional Accord funds.

✅ $575.4M yearly to hold rates near 14.67 cents/kWh

✅ Sources: Nalcor oil $231M, Holyrood $150M, rates/dividends $123.4M

✅ Options: export sales, restructuring, Atlantic Accord, HQ tax

 

Newfoundland and Labrador PC Leader Ches Crosbie says Muskrat Falls won't drive up electricity rates, a goal consistent with an agreement to shield ratepayers from cost overruns, if he's elected premier.

According to Crosbie, who presented the party's Crosbie Hydro Energy Action Plan — acronym CHEAP — at a press conference Monday, $575.4 million is needed per year in order to keep rates from ballooning past 14.67 cents per kilowatt hour.

Here's where he thinks the money could come from:

  • Hydro rates and dividends — $123.4 million
  • Export sales — $40.1 million
  • Nalcor restructuring — $30 million
  • Holyrood savings — $150  million
  • Nalcor oil revenue — $231 million

The oil money, Crosbie said, isn't going into government coffers but being invested into the offshore which, he said, is a good place for it.

"But the plan from the beginning around Muskrat Falls was that if there was need for it — for mitigation for rates — that those revenues and operating cash flows from Nalcor oil and gas would be available to be recycled into rate mitigation, as reflected in a recent financial update on the pandemic's impact. and that's what we're going to have to do," he said.

According to Crosbie, his numbers come from the preliminary stage of the Public Utilities Board process, even as rate mitigation talks have lacked public details.

This is a recent aerial view of the Muskrat Falls project in central Labrador. The project is more than 90 per cent complete, with first power forecast for late 2019, alongside Ottawa's $5.2B support for the project. (Nalcor)

"I'm telling you this is the best information available to anyone outside of government," he said. "We're working on what we can."

The PUB estimated Nalcor restructuring could save between $10 million and $15 million, according to Crosbie, but he figures there's "enough duplication and overpayment involved in the way things are now set up that we can find $30 million there."

Currently, provincial ratepayers pay about 12 cents per kilowatt hour as electricity users have started paying for Muskrat Falls costs.

Crosbie's $575.4-million figure would put rates at 14.67 cents per kilowatt-hour in 2021, where his plan pledges to keep them.

A recent Public Utilities Board Report says there's a potential $10 million to $15 million in savings from Nalcor, but Crosbie says he can find $30 million. (CBC)

"The promise is that Muskrat Falls, when it comes online — comes in service — will not increase your rates. Between now and when that happens there are rate increases already in the pipeline up to that level of [14.67 cents per kilowatt-hour] … so that is the baseline target rate at which rates will be kept.

"In other words, Muskrat will not drive up prices for electricity to consumers beyond that point."

In addition to those savings, Crosbie's plan outlined two further steps.

"We think it could be done out of the resources that I've just identified now, but if there's a problem with that, and as a temporary measure, we can use a modest amount of the Atlantic Accord review, fiscal review, revenues," he said.

 

Plan 'nothing new'

Premier Dwight Ball slammed the plan at the House of Assembly on Monday, saying it lacked insight.

"It was a copy and paste exercise," he told reporters. "There's nothing new in that plan. Not at all."

"We're not leaving any stone unturned of where the opportunity would be to actually generate revenue," he said.  "We are genuinely concerned about rate mitigation and we've got to get a plan in place."

 

Potential to tax Hydro-Québec

Crosbie also said there's potential to tax Hydro-Québec.

According to Crosbie, tax exemptions that expired in 2016 allow the province to tax exports from the Upper Churchill, which, he said, could result in "hundreds of millions or billions" in revenue.

"It's not my philosophy to immediately go and do that because that would generate litigation — who needs more of that? — but we do need to let Quebec know that we're very aware of that, and aware of that opportunity, and invite them to come talk about a whole host of issues," Crosbie said.

Crosbie said the tax would also have to be applied to domestic consumption.

"But so massive is the potential revenue from the Upper Churchill export that there would be ways to mitigate that and negate the effect of that on consumers in the province."

Crosbie said with the Atlantic Accord revenue, he could still present a balanced budget by 2022.

 

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Climate change: Electrical industry's 'dirty secret' boosts warming

Sulphur Hexafluoride (SF6) Emissions drive rising greenhouse gas impacts in electrical switchgear, power grids, and renewables, with extreme global warming potential, long atmospheric lifetime, and leakage risks challenging climate targets and grid decarbonization.

 

Key Points

SF6 emissions are leaks from electrical switchgear and grids, a high-GWP gas with ~1,000-year lifetime.

✅ 23,500x CO2 global warming potential (GWP)

✅ Leaks from switchgear, breakers, gas-insulated substations

✅ Clean air and vacuum alternatives emerging for MV/HV

 

Sulphur hexafluoride, or SF6, is widely used in the electrical industry to prevent short circuits and accidents.

But leaks of the little-known gas in the UK and the rest of the EU in 2017 were the equivalent of putting an extra 1.3 million cars on the road.

Levels are rising as an unintended consequence of the green energy boom and the broader global energy transition worldwide.

Cheap and non-flammable, SF6 is a colourless, odourless, synthetic gas. It makes a hugely effective insulating material for medium and high-voltage electrical installations.

It is widely used across the industry, from large power stations to wind turbines to electrical sub-stations in towns and cities.

It prevents electrical accidents and fires.

However, the significant downside to using the gas is that it has the highest global warming potential of any known substance. It is 23,500 times more warming than carbon dioxide (CO2).

Just one kilogram of SF6 warms the Earth to the same extent as 24 people flying London to New York return.

It also persists in the atmosphere for a long time, warming the Earth for at least 1,000 years.

 

So why are we using more of this powerful warming gas?

The way we make electricity around the world is changing rapidly, with New Zealand's push to electrify in its energy system.

Where once large coal-fired power stations brought energy to millions, the drive to combat climate change and to move away from coal means they are now being replaced by mixed sources of power including wind, solar and gas.

This has resulted in many more connections to the electricity grid, and with EU electricity use could double by 2050, a rise in the number of electrical switches and circuit breakers that are needed to prevent serious accidents.

Collectively, these safety devices are called switchgear. The vast majority use SF6 gas to quench arcs and stop short circuits.

"As renewable projects are getting bigger and bigger, we have had to use it within wind turbines specifically," said Costa Pirgousis, an engineer with Scottish Power Renewables on its new East Anglia wind farm, which doesn't use SF6 in turbines.

"As we are putting in more and more turbines, we need more and more switchgear and, as a result, more SF6 is being introduced into big turbines off shore.

"It's been proven for years and we know how it works, and as a result it is very reliable and very low maintenance for us offshore."

 

How do we know that SF6 is increasing?

Across the entire UK network of power lines and substations, there are around one million kilograms of SF6 installed.

A study from the University of Cardiff found that across all transmission and distribution networks, the amount used was increasing by 30-40 tonnes per year.

This rise was also reflected across Europe with total emissions from the 28 member states in 2017 equivalent to 6.73 million tonnes of CO2. That's the same as the emissions from 1.3 million extra cars on the road for a year.

Researchers at the University of Bristol who monitor concentrations of warming gases in the atmosphere say they have seen significant rises in the last 20 years.

"We make measurements of SF6 in the background atmosphere," said Dr Matt Rigby, reader in atmospheric chemistry at Bristol.

"What we've seen is that the levels have increased substantially, and we've seen almost a doubling of the atmospheric concentration in the last two decades."

 

How does SF6 get into the atmosphere?

The most important means by which SF6 gets into the atmosphere is from leaks in the electricity industry.

Electrical company Eaton, which manufactures switchgear without SF6, says its research indicates that for the full life-cycle of the product, leaks could be as high as 15% - much higher than many other estimates.

Louis Schaeffer, electrical business manager at Eaton, said: "The newer gear has very low leak rates but the key question is do you have newer gear?

"We looked at all equipment and looked at the average of all those leak rates, and we didn't see people taking into account the filling of the gas. Plus, we looked at how you recycle it and return it and also included the catastrophic leaks."

 

How damaging to the climate is this gas?

Concentrations in the atmosphere are very small right now, just a fraction of the amount of CO2 in the air.

However, the global installed base of SF6 is expected to grow by 75% by 2030, as data-driven electricity demand surges worldwide.

Another concern is that SF6 is a synthetic gas and isn't absorbed or destroyed naturally. It will all have to be replaced and destroyed to limit the impact on the climate.

Developed countries are expected to report every year to the UN on how much SF6 they use, but developing countries do not face any restrictions on use.

Right now, scientists are detecting concentrations in the atmosphere that are 10 times the amount declared by countries in their reports. Scientists say this is not all coming from countries like India, China and South Korea.

One study found that the methods used to calculate emissions in richer countries "severely under-reported" emissions over the past two decades.

 

Why hasn't this been banned?

SF6 comes under a group of human-produced substances known as F-gases. The European Commission tried to prohibit a number of these environmentally harmful substances, including gases in refrigeration and air conditioning, back in 2014.

 

But they faced strong opposition from industries across Europe.

"In the end, the electrical industry lobby was too strong and we had to give in to them," said Dutch Green MEP Bas Eickhout, who was responsible for the attempt to regulate F-gases.

"The electric sector was very strong in arguing that if you want an energy transition, and you have to shift more to electricity, you will need more electric devices. And then you also will need more SF6.

"They used the argument that otherwise the energy transition would be slowed down."

 

What do regulator and electrical companies say about the gas?

Everyone is trying to reduce their dependence on the gas, and US control efforts suggest targeted policies can drive declines, as it is universally recognised as harmful to the climate.

In the UK, energy regulator Ofgem says it is working with utilities to try to limit leaks of the gas.

"We are using a range of tools to make sure that companies limit their use of SF6, a potent greenhouse gas, where this is in the interest of energy consumers," an Ofgem spokesperson told BBC News.

"This includes funding innovation trials and rewarding companies to research and find alternatives, setting emissions targets, rewarding companies that beat those targets, and penalising those that miss them."

 

Are there alternatives - and are they very expensive?

The question of alternatives to SF6 has been contentious over recent years.

For high-voltage applications, experts say there are very few solutions that have been rigorously tested.

"There is no real alternative that is proven," said Prof Manu Haddad from the school of engineering at Cardiff University.

"There are some that are being proposed now but to prove their operation over a long period of time is a risk that many companies don't want to take."

Medium voltage operations there are several tried-and-tested materials. Some in the industry say that the conservative nature of the electrical industry is the key reason that few want to change to a less harmful alternative.

 

"I will tell you, everyone in this industry knows you can do this; there is not a technical reason not to do it," said Louis Schaffer from Eaton.

"It's not really economic; it's more a question that change takes effort and if you don't have to, you won't do it."

 

Some companies are feeling the winds of change

Sitting in the North Sea some 43km from the Suffolk coast, Scottish Power Renewables has installed one of world's biggest wind farms, in line with a sustainable electric planet vision, where the turbines will be free of SF6 gas.

East Anglia One will see 102 of these towering generators erected, with the capacity to produce up to 714MW (megawatts) of power by 2020, enough to supply half a million homes.

Previously, an installation like this would have used switchgear supplied with SF6, to prevent the electrical accidents that can lead to fires.

Each turbine would normally have contained around 5kg of SF6, which, if it leaked into the atmosphere, would add the equivalent of around 117 tonnes of carbon dioxide. This is roughly the same as the annual emissions from 25 cars.

"In this case we are using a combination of clean air and vacuum technology within the turbine. It allows us to still have a very efficient, reliable, high-voltage network but to also be environmentally friendly," said Costa Pirgousis from Scottish Power Renewables.

"Once there are viable alternatives on the market, there is no reason not to use them. In this case, we've got a viable alternative and that's why we are using it."

But even for companies that are trying to limit the use of SF6, there are still limitations. At the heart of East Anglia One sits a giant offshore substation to which all 102 turbines will connect. It still uses significant quantities of the highly warming gas.

 

What happens next ?

The EU will review the use of SF6 next year and will examine whether alternatives are available. However, even the most optimistic experts don't think that any ban is likely to be put in place before 2025.

 

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India Electricity Prices are Spiking

India spot electricity prices surged on Q3 demand, lifting power tariffs in the spot market as discoms scrambled for supply; Sembcorp SGPL boosted PLF and short-term PPA realizations, benefiting from INR per kWh peaks.

 

Key Points

India spot electricity prices hit Q3 records amid demand spikes, lifting tariffs and aiding Sembcorp SGPL via PLF gains.

✅ Record 10.6 cents/kWh average; 15-minute peak 20.7 cents/kWh

✅ SGPL shifted output to short-term PPA at 7.3 cents/kWh

✅ PLF ramped above 90%, cutting core losses by 30-40%

 

Electricity prices in India, now the third-largest electricity producer globally, bolted to a record high of 10.6 cents/kWh (INR5.1/kWh) in Q3.

A jolt in Indian spot electricity prices could save Sembcorp Industries' Indian business from further losses, even though demand has occasionally slumped in recent years, UOB Kay Hian said.

The firm said spot electricity prices in India bolted to a record high of 10.6 cents/kWh (INR5.1/kWh) in Q3 and even hit a 15-minute peak of 20.7 cents/kWh (9.9/kWh). The spike was due to a power supply crunch on higher electricity demand from power distribution companies, alongside higher imported coal volumes as domestic supplies shrank.

As an effect, Sembcorp Industries' Sembcorp Gayatri Power Limited's (SGPL) losses of $26m in Q1 and $29m in Q2 could narrow down by as much as 30-40%.

On a net basis, SGPL will recognise a significantly higher electricity tariff in 3Q17. By tactically shutting down its Unit #3 for maintenance, Unit #4 effectively had its generation contracted out at the higher short-term PPA tariff of around 7.3 cents/kWh (Rs3.5/kWh).

SGPL also capitalised on the price spike in 3Q17 as it ramped up its plant load factor (PLF) to more than 90%.

“On the back of this, coupled with the effects of reduced finance costs, we expect SGPL’s 3Q17 quarterly core loss to shrink by 30-40% from previous quarters,” UOB Kay Hian said.

Whilst electricity prices have corrected to 7.1 cents/kWh (INR3.4/kWh), the firm said it could still remain elevated on structural factors, even as coal and electricity shortages ease nationwide.

Sembcorp Industries' India operations brought in a robust performance for Q3. PLF for Thermal Powertech Corporation India Limited (TPCIL) hit 91%, whilst it reached 73% for SGPL, echoing the broader trend of thermal PLF up across the sector.

 

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A Texas-Sized Gas-for-Electricity Swap

Texas Heat Pump Electrification replaces natural gas furnaces with electric heating across ERCOT, cutting carbon emissions, lowering utility bills, shifting summer peaks to winter, and aligning higher loads with strong seasonal wind power generation.

 

Key Points

Statewide shift from gas furnaces to heat pumps in Texas, reducing emissions and bills while moving grid peak to winter.

✅ Up to $452 annual utility savings per household

✅ CO2 cuts up to 13.8 million metric tons in scenarios

✅ Winter peak rises, summer peak falls; wind aligns with load

 

What would happen if you converted all the single-family homes in Texas from natural gas to electric heating?

According to a paper from Pecan Street, an Austin-based energy research organization, the transition would reduce climate-warming pollution, save Texas households up to $452 annually on their utility bills, and flip the state from a summer-peaking to a winter-peaking system. And that winter peak would be “nothing the grid couldn’t evolve to handle,” according to co-author Joshua Rhodes, a view echoed by analyses outlining Texas grid reliability improvements statewide today.

The report stems from the reality that buildings must be part of any comprehensive climate action plan.

“If we do want to decarbonize, eventually we do have to move into that space. It may not be the lowest-hanging fruit, but eventually we will have to get there,” said Rhodes.

Rhodes is a founding partner of the consultancy IdeaSmiths and an analyst at Vibrant Clean Energy. Pecan Street commissioned the study, which is distilled from a larger original analysis by IdeaSmiths, at the request of the nonprofit Environmental Defense Fund.

In an interview, Rhodes said, “The goal and motivation were to put bounding on some of the claims that have been made about electrification: that if we electrify a lot of different end uses or sectors of the economy...power demand of the grid would double.”

Rhodes and co-author Philip R. White used an analysis tool from the National Renewable Energy Laboratory called ResStock to determine the impact of replacing natural-gas furnaces with electric heat pumps in homes across the ERCOT service territory, which encompasses 90 percent of Texas’ electricity load.

Rhodes and White ran 80,000 simulations in order to determine how heat pumps would perform in Texas homes and how the pumps would impact the ERCOT grid.

The researchers modeled the use of “standard efficiency” (ducted, SEER 14, 8.2 HSPF air-source heat pump) and “superior efficiency” (ductless, SEER 29.3, 14 HSPF mini-split heat pump) heat pump models against two weather data sets — a typical meteorological year, and 2011, which had extreme weather in both the winter and summer and highlighted blackout risks during severe heat for many regions.

Emissions were calculated using Texas’ power sector data from 2017. For energy cost calculations, IdeaSmiths used 10.93 cents per kilowatt-hour for electricity and 8.4 cents per therm for natural gas.

Nothing the grid can't handle
Rhodes and White modeled six scenarios. All the scenarios resulted in annual household utility bill savings — including the two in which annual electricity demand increased — ranging from $57.82 for the standard efficiency heat pump and typical meteorological year to $451.90 for the high-efficiency heat pump and 2011 extreme weather year.

“For the average home, it was cheaper to switch. It made economic sense today to switch to a relatively high-efficiency heat pump,” said Rhodes. “Electricity bills would go up, but gas bills can go down.”

All the scenarios found carbon savings too, with CO2 reductions ranging from 2.6 million metric tons with a standard efficiency heat pump and typical meteorological year to 13.8 million metric tons with the high-efficiency heat pump in 2011-year weather.

Peak electricity demand in Texas would shift from summer to winter. Because heat pumps provide both high-efficiency space heating and cooling, in the scenario with “superior efficiency” heat pumps, the summer peak drops by nearly 24 percent to 54 gigawatts compared to ERCOT’s 71-gigawatt 2016 summer peak, even as recurring strains on the Texas power grid during extreme conditions persist.

The winter peak would increase compared to ERCOT’s 66-gigawatt 2018 winter peak, up by 22.73 percent to 81 gigawatts with standard efficiency heat pumps and up by 10.6 percent to 73 gigawatts with high-efficiency heat pumps.

“The grid could evolve to handle this. This is not a wholesale rethinking of how the grid would have to operate,” said Rhodes.

He added, “There would be some operational changes if we went to a winter-peaking grid. There would be implications for when power plants and transmission lines schedule their downtime for maintenance. But this is not beyond the realm of reality.”

And because Texas’ wind power generation is higher in winter, a winter peak would better match the expected higher load from all-electric heating to the availability of zero-carbon electricity.

 

A conservative estimate
The study presented what are likely conservative estimates of the potential for heat pumps to reduce carbon pollution and lower peak electricity demand, especially when paired with efficiency and demand response strategies that can flatten demand.

Electric heat pumps will become cleaner as more zero-carbon wind and solar power are added to the ERCOT grid, as utilities such as Tucson Electric Power phase out coal. By the end of 2018, 30 percent of the energy used on the ERCOT grid was from carbon-free sources.

According to the U.S. Energy Information Administration, three in five Texas households already use electricity as their primary source of heat, much of it electric-resistance heating. Rhodes and White did not model the energy use and peak demand impacts of replacing that electric-resistance heating with much more energy efficient heat pumps.

“Most of the electric-resistance heating in Texas is located in the very far south, where they don’t have much heating at all,” Rhodes said. “You would see savings in terms of the bills there because these heat pumps definitely operate more efficiently than electric-resistance heating for most of the time.”

Rhodes and White also highlighted areas for future research. For one, their study did not factor in the upfront cost to homeowners of installing heat pumps.

“More study is needed,” they write in the Pecan Street paper, “to determine the feasibility of various ‘replacement’ scenarios and how and to what degree the upgrade costs would be shared by others.”

Research from the Rocky Mountain Institute has found that electrification of both space and water heating is cheaper for homeowners over the life of the appliances in most new construction, when transitioning from propane or heating oil, when a gas furnace and air conditioner are replaced at the same time, and when rooftop solar is coupled with electrification, aligning with broader utility trends toward electrification.

More work is also needed to assess the best way to jump-start the market for high-efficiency all-electric heating. Rhodes believes getting installers on board is key.

“Whenever a homeowner’s making a decision, if their system goes out, they lean heavily on what the HVAC company suggests or tells them because the average homeowner doesn’t know much about their systems,” he said.

More work is also needed to assess the best way to jump-start the market for high-efficiency all-electric heating, and how utility strategies such as smart home network programs affect adoption too. Rhodes believes getting installers on board is key.

 

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