Texan BESS saved ERCOT $750m per day during January winter freeze

Texan BESS saved ERCOT $750m per day during January winter freeze

Texan BESS saved ERCOT $750m per day during January winter freeze 1024 653 Batteries International

May 31, 2024: Over the month of January 2024 and the winter freeze in Texas, BESS units saved an estimated $750 million in day-ahead market costs, according to a report by Aurora Energy Research that analyzed figures from the Electric Reliability Council of Texas (better known as ERCOT).

These showed that, specifically, during one particular two-day freeze battery storage saved consumers some $683 million.

The figures, however, do not show what the return of investment has been given the huge cost of installation of the BESS and operational charges.

“Battery energy storage systems in Texas have come under increasing scrutiny, but our analysis shows batteries have increased reliability and reduced costs for Texans during critical days, such as last January’s winter storm,” said Olivier Beaufils, ERCOT market lead at Aurora Energy Research.

“Interestingly, this has not come at the expense of gas-fired generation. In fact, as battery storage systems have been increasingly providing ancillary services in Texas, they have enabled an equivalent amount of natural gas generation to participate in the system.

“This means that one GW of newly constructed batteries participating in the ancillary services markets have resulted in about a GW of gas-fired generation coming out of back-up services and moving into the energy markets during periods of system stress.”

According to the report, BESS facilities have already proven to be a critical component of Texas’ energy mix by helping the state maintain reliable, cost-effective and dispatchable power in times of high demand.

They have helped address system dynamics created by intermittent renewable energy and the grid’s challenging operating conditions which are exacerbated by harsh weather. The report found that in both regular and extreme conditions, batteries have helped lower system costs while enabling increasing natural gas generation. 

Throughout last summer and especially on September 6, 2023, amid extreme summer heat and surging power demand, batteries kept the lights on and averted an emergency load-shedding event by dispatching a peak of 2GW of power when ERCOT reserves were lowest, said the report.

 For the past four years Texas has experienced extreme winter storms, record-setting hot summers, and rapidly growing power demand that have tested the state’s power grid.

Conditions in Texas this year indicate the coming summer will be another trying environment.

Aurora’s report primarily relies on an analysis of historical data provided by ERCOT which includes installed BESS capacity, market-wide supply, demand, wholesale energy prices and unit dispatch, ancillary service awards, and ERCOT operating reserves (the amount of remaining generation capacity available to the system).