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USA: ERCOT electricity prices vary more with changes in wind power than with electricity demand

  • Oct 7, 2022

Source: US Energy Information Administration

In the Short-Term Energy Outlook Supplement released on October 4, we analyzed how variability in electricity demand and wind generation affects hourly electricity prices in Texas’s wholesale power market under summer peak-day conditions, when summer electricity demand is highest. The Electric Reliability Council of Texas (ERCOT)—which runs the wholesale power market in Texas—has had significant peak-load growth in recent years (16% between 2011 and 2022) and significantly increased its wind generation (from 9% of the electricity generation mix in 2011 to 24% in 2021). We found that both high levels of electricity demand and low wind availability can significantly raise wholesale prices in ERCOT, supported by its market design. When combined, these factors can lead to especially sharp price spikes during summer peak-day conditions.


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