Sierra Club is pretty darned busy these days, with a new administration freezing federal funding - legally or otherwise - a congress that just rolled back a fee on industry that emits too much climate-disrupting methane - and of course the legislature debating budgets and bills. But even during these seachanges, our independent Texas electric grid known as ERCOT (Electric Reliability Council of Texas) keeps chugging along, setting new records in demand, solar and storage.
Texas Energy Grid Faces Record Demand and Renewable Growth
It’s kind of hard to keep up but over the last month we have set new records in overall winter-time demand, overall solar generation, and renewable generation as a percentage of load. And guess what - the PUCT has finally announced it will open up its rules on energy efficiency, something Sierra Club and our allies have been demanding for about three years.
Solar Energy Shatters Records in Texas
ERCOT keeps setting records for the amount of solar power on our grid. Solar power doesn’t produce emissions and doesn’t need water to operate, two big advantages over fossil fuel based power production.
Recent Solar Generation Milestones
Basically, every week, ERCOT has been setting new records but here are a couple data points.
- On February 16th, ERCOT set a new solar record when 24,323 MW solar was generated right around 2 pm, which was also a solar penetration record since that day at that hour, solar was providing 48.61% of the total demand in ERCOT.
- On February 28th, around 2:30 PM, solar was at it again, generating 24, 327 MWs of solar, which that day equaled 51.3% of all electricity demand consumed at that time.
- On March 1st, at 10:29 AM, when solar generated 24,818 MWs of power, or about 54%of all the power consumed at that moment.
Now of course this is not all the time. There are many times on the grid when power is produced principally by gas plants and overall, gas remains the main power source in ERCOT, and, last year, gas provided about 45% of all the power used. But the fact is that after gas, wind and now solar are Texas’s main sources of electricity, together often equally 50 to 60 percent of all our needs.
Rising Energy Demand and Winter Peak Records
In the most recent cold snap in late February, ERCOT set a new winter demand record when amazingly the Electric Reliability Council of Texas (ERCOT) recorded a winter peak of 80.63 gigawatts (GW) on February 20, 2025. This was the first time ERCOT's winter demand exceeded 80 GW, a number that was previously associated with summer. The previous record was set during a cold snap in January of 2024, when on January 16th, ERCOT set a wintertime record of 78.35 GW. It is important to note that during winter storm Uri, it is likely we would have broke 80 GWs if many folks had not been without power, but still it is striking just how quickly demand has risen in Texas.
What’s Driving the Surge? Bitcoin, Data Centers, and More
Part of this is due to new large loads like bitcoin, cryptomines and data centers flocking to Texas, as well as continued population growth, but the other reality is that many residential consumers and small businesses live and work in older inefficient buildings with poor insulation, windows or even worse, older electric “strip” heating.
How Energy Efficiency Could Reduce Peak Demand
A variety of studies have shown that if Texas were to invest more ambitiously in programs to reduce residential and small business energy use and demand - and in particular with replacing inefficient heating with modern heat pumps - we could reduce wintertime demand by thousands of MWs.
Can ERCOT Handle Future Growth?
While ERCOT did issue a conservation notice, we never got as close to reaching our supply limits as expected, never had to go into “energy emergency alerts” and never got close to needing “Emergency Response Services,” helped in part by record solar generation during the day.
The Role of Battery Storage in Grid Stability
With support from the latest technology, battery storage - which came on precisely when the grid got tight in the early mornings and evenings when the sun was no longer shining - we did not enter an emergency alert A reminded that the last time ERCOT issued an “Energy Emergency Alert” was September 6th, 2023, mainly due to transmission issues that blocked wind generation from making its way from South Texas to Central Texas.
ERCOT’s Projections for 2025-2029
No, the grid is not fixed. For one ERCOT continues to predict massive new growth in Texas due to the potential arrival of “large loads” from cryptomining to Artificial Intelligence, to data centers, to LNG facilities, to chip manufacturing to hydrogen production. Much of this large load is designed to consume power all the time and ERCOT is guessing that we could see our summer peak demand rise from about 85 GWs today to somewhere north of 140 GWs by the end of 2029 according to the new “Report on the Capacity, Demand and Reserves (CDR) in the ERCOT Region, 2025-2029”.
Now, most analysts believe this is not likely - quite simply all of this load won’t arrive if we have not significantly increased our energy supply and some of this load is very speculative, but everyone agrees that our load is growing and will grow. In particular the brand new CDR predicts that things could get very dicey within two years due to this new growth, especially when combined with summer extremes.
As the CDR itself states:
"One scenario in this CDR indicates that Planning Reserve Margins for 2025 through 2029 decrease significantly from year to year, and cross over to negative values in 2026 or 2027 depending on the season. The summer Margins for the peak Net Load hours are lower than for the peak Load hours due mainly to decreasing solar generation availability in the early evening when loads are still high. The decreases are mainly due to the addition of new forecasted loads reported by Transmission Service Providers (TSPs), dominated by large consumers such as data centers, industrial/oil & gas production facilities, and cryptocurrency mining operations."
The following table shows the summer peak Load forecasts for 2025-2029 according to ERCOT’s recent CDR
Public Utility Commission Takes Steps Toward Energy Efficiency
In August of 2022, the Sierra Club filed a petition for rulemaking at the Commission to create new programs and goals for energy efficiency, including setting a new one percent goal to reduce overall energy use by residential and commercial customers within four years.
Currently we are only achieving about one-quarter of one percent through energy efficiency programs. But after years of promise, the PUCT has failed to take action, until last week.
Sierra Club’s Push for New Energy Efficiency Rules
Last week at the biannual Energy Efficiency Implementation Project Spring meeting, and only a few weeks after the Sierra Club delivered over 1,100 Signatures from Texans all around the state calling for bold action, the PUCT finally announced they would begin a rulemaking covering three rules. PUCT executive director Connie Corona reminded participants including the Sierra Club that last legislative session they were granted new staff to create the Office of Energy Efficiency. A year into its founding, the new Office has begun a new process to update their rules, hopefully to expand programs. They are starting small, creating a new rulemaking project and asking stakeholders some basic questions.
First up, they are asking stakeholders to submit - in Project 57743 - their ideas and responses on definitions for hard-to-reach, low-income and cost-effectiveness. The deadline for response on those questions is March 20th.
Now to be clear this is just the beginning of looking at rules and they have not considered for example expanding goals yet but eventually they will. They will take input on three different rules related to energy efficiency eventually. But the goal is to have an actual proposal for adoption by the end of 2025.
You can watch the workshop here.
The announcement on the rulemaking occurs around the 2 pm mark.
New Utility Programs for Demand Response and Solar Incentives
At the same meeting, two of the largest utilities - AEP and Centerpoint Energy - did announce they were beginning new residential demand response programs which is a direct result of passage of SB 1699, a bill supported by the Sierra Club in 2023. Centerpoint Energy also announced for the first time that they are adding a new solar program and a new program to give incentives for meeting the new 2024 energy codes that are above codes in most cities in Texas. To see a copy of the presentations given by the EEIP at the meeting last week go here and see the presentation filed in the docket.