Home Investing News Texas enters peak season for power output and emissions: Maguire

Texas enters peak season for power output and emissions: Maguire


By Gavin Maguire

LITTLETON, Colorado (Reuters) -The four-month window from May through August marks the high point for power generation and demand in the state of Texas, the largest U.S. user of fossil fuels for power generation and the country’s top power sector emitter.

A key driver of Texas power demand is an annual climb in air conditioner use by homes and businesses during the hottest time of year, when average temperatures can climb above 90 degrees Fahrenheit (32 degrees Celsius) with high humidity.

To meet the demand surge, power producers in the Electric Reliability Council of Texas (ERCOT) system must frequently lift generation by more than 30% from the output levels during the opening four months of the year.

Such high levels of output – which must be sustained round the clock to prevent system load strain and potential outages – often require power firms to deploy high volumes of coal and natural gas to ensure adequate baseload power availability.

Utilities also try to deploy maximum volumes of power from renewable sources during the summer peak, but often encounter a dip in wind farm output during that period that can exacerbate power shortages and add to system strain.

In 2024, ERCOT solar generation levels are expected to hit fresh records thanks to new and expanded solar farms, but use of coal and gas may also hit new highs if both overall demand and wind farm output follow their usual seasonal trends.


Total power generation by the ERCOT system over the opening four months of 2024 was 5.57 million megawatt hours (MWh), according to LSEG, the highest in at least three years for that time slot and nearly 7% above the total for that period in 2023.

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A nearly 50% rise in solar generation from the first four months of 2023 was a major contributor to the growth in ERCOT total output.

But a nearly 5% slide in output from ERCOT nuclear plants and declines from both wind and hydro sources resulted in power firms deploying the highest combined quantity of coal and gas-fired power since at least 2021 during the opening four months of 2024, LSEG data shows.

Total generation from coal and natural gas plants was 2.88 million MWh through April 2024, 11% more than during the opening four months of 2023.

This means even before entering the peak generation season, ERCOT power firms have already deployed the highest volume of fossil fuels in generation in more than three years.


ERCOT power generation totals during the middle four months of the calendar year have averaged 35% more than during the opening four months from 2021 to 2023, LSEG data shows.

In 2023, total power output from May through August was 40% more than the total generated from January through April.

If power needs during May to August 2024 rise by a similar degree, generation will need to reach 7.8 million MWh during that period.

That total would be 6% more than during May to August 2023, and may require generators to crank output from both coal and gas-fired plants, especially at night when solar production stops.

In 2023, total output from ERCOT gas and coal plants amounted to 4.8 million MWh during the May to August window, and the highest since at least 2021.

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Total power sector emissions during that period were 71.2 million metric tons of carbon dioxide, according to energy think tank Ember, which was 20 million tons or 40% more than during the opening four months of 2023.

If ERCOT power firms must meet the 6% rise in demand entirely from coal and gas plants from May to August 2024, that would equate to 5.13 million MWh from fossil fuels and could result in close to 75 million tons in related emissions.

Consistently above-normal wind speeds during the summer could help power firms cut some use of coal and gas plants, and may lead to lower overall emissions.

But if wind generation trends follow their normal pattern, power firms may have no choice but to lift coal and gas-fired output, raising emissions along with it.

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