Summer 2024 Predictions for ERCOT and Energy Solutions Beyond Solar

As the mercury rises, so does the demand for energy.  

On any given day when the temperature hits 100 degrees in the ERCOT region, air conditioning is the main driver of spikes in energy demand. 

ERCOT, a deregulated market, only regulates the maximum price at $5000/mwh – a precarious context in the face of more potential summer heatwaves. 

In this blog post, we’ll explore our predictions for the summer of 2024, and why – despite the summer sun – solar power isn’t necessarily the answer to overcoming energy challenges in ERCOT.  

2024 Summer Predictions

In 2023, Texas experienced the second-hottest summer ever recorded in the state, with an average temperature of 85.3 degrees. This only just missed the #1 spot, which was claimed in the summer of 2011, with soaring average temperatures of 86.8 degrees. 

In August alone, the average temperature hit 92.9 degrees. 

But could the summer of 2024 be set to be even hotter? 

Summer officially begins with the summer solstice, and 2024 is set to be the earliest solstice in 128 years. This early start could be setting the precedent for an even hotter, longer summer this year – but only time will tell.  

What is clear from the data is that the long, hot summers like the one we saw in 2023 are here to stay and we may be in for more extended evening peaks this summer, similar to what we’ve observed over the last few years.  

This presents a significant challenge for Rural Electric Cooperatives (RECs), who must be prepared to handle the persistent increased strain on their resources. 

Want to know more about the impact of weather challenges on Texas RECs? Read our blog post on how Texas is navigating its energy shift amidst climate extremes. 

Source: weather.gov

Why Solar Power Isn’t the Answer

At first glance, it might seem that the solution to the energy challenges caused by the sweltering summer heat is simple: more sun equals more solar power.  

However, this assumption overlooks a crucial aspect of the energy demand problem we face during these hot summer months. 

The critical issue lies in the extended evening peaks.  

The sun goes down, but temperatures remain high, causing residents to keep their air conditioning running at full capacity. Meanwhile, the wind hasn’t picked up enough for wind energy to take over, creating a gap in the energy supply. This leaves the availability and pricing of energy at the mercy of the market and the grid, a precarious situation in a deregulated market like ERCOT. 

We’re seeing this pattern all over Texas and we explore it more deeply in our article on ERCOT: What the data tells us.  

What’s clear is that this isn’t a challenge that can be solved by simply investing more in solar power. The most viable and effective solution depends on the unique situation of each REC and the operational assets they already have.  

However, conversations we’re repeatedly having with our REC partners are around Battery Energy Storage Systems (BESS) and Reciprocating Internal Combustion Engines (RECIPs). 

Why? Because BESS and RECIPs can provide immediately dispatchable energy to combat the challenges of the deregulated ERCOT market. They can help control price spikes during the highest periods of demand, ensuring that RECs can continue to provide reliable, affordable energy to their communities, even during the hottest parts of the summer.

Resilience and Reliability: The Key Components of Managing Energy Demand

Let’s break down these terms: 

Reliability refers to a power supply that remains consistent and predictable in everyday situations and demands. In a reliable grid, power outages are rare and short-lived, ensuring that daily life and business operations go uninterrupted. 

Resilience, on the other hand, refers to a power supply that withstands duress and recovers quickly from unexpected disruptions, particularly those due to severe weather events or other emergencies. A resilient grid is designed and managed to anticipate, absorb, adapt to, and rapidly recover from such events. 

While reliability focuses on maintaining normalcy, resilience is about bouncing back from the abnormal.  

In the face of this increasing extreme and increasing severe weather, this distinction must be understood. A reliable grid under normal conditions may falter during a severe storm or a natural disaster – which is where resilience is critical.  

Some would argue that enduring summer heat waves comes down to energy resilience. But in fact, when those heatwaves become regular annual occurrences, it’s time to question the reliability of your energy mix. 

Finding the Right Combination of Energy Assets

As we brace for the potential of more summer heatwaves, it’s clear that the challenges facing RECs are significant. However, at Perceptive Power Infrastructure, we believe that these challenges also present opportunities. 

The opportunity lies in RECs running energy assets that provide less costly energy during peak times, uninfluenced by market pricing. So, the question is:  

What is the right combination based on what we see historically, now, and in the future? 

The key to successfully navigating these challenges lies in understanding the unique needs of rural communities to create tailored energy solutions. This is where our proprietary modeling and The Perceptive Way approach come into play.  

We work closely with RECs, engaging in real conversations to understand their specific needs and challenges so that we can help them combat the summer heat waves in years to come.  

To talk to our team about exploring your distributed energy options, get in touch today.