ERCOT – As a consumer, you’ve most likely heard the name before, but do you know exactly what it does? There’re so many acronyms in Texas’ deregulated market, it’s tough to keep your head wrapped around all of them. ERCOT, however, is a big one – especially if you want to know how your electric service is supervised and maintained.
Officially called the Electric Reliability Council of Texas, ERCOT was founded in 1970, becoming the primary overseer of Texas’ power grid. Essentially, that means it’s responsible for managing the stream of electricity to about 23 million electric customers. These 23 million customers all fall within the jurisdiction of the ERCOT region, which encompasses about 75% of the state’s landmass and 85% of the state’s power grid. Remember, not all of Texas is deregulated. ERCOT manages areas where residents have the power to choose a retail electric provider.
ERCOT is a nonprofit organization, which focuses on the well-being of Texas consumers rather than its own financial gain. Specifically, ERCOT serves Texans by ensuring the reliability of their electric service. It goes about doing so in a number of different ways, some of which include:
Assisting the sign-up and switching process between retail electric providers.
Helping organize Texas’ wholesale electric market and retail electric market.
Maintaining nondiscriminatory policies for buyers and sellers of electricity around the ERCOT region.
ERCOT is also part of a larger network known as NERC. NERC, which stands for the North American Electric Reliability Corporation, is a macro organization that helps develop and oversee the bulk power system in the U.S. and Canada. ERCOT is one of several organizations that works closely with NERC to ensure the safety and dependability of electricity’s transmission across nearly every part of the United States and Canada.
While most Texans won’t have much interaction with ERCOT (or NERC, for that matter), they can rest assured that they’re in good hands. Every year, ERCOT works to sustain and improve the Texas customer’s electric supply. No matter your provider, no matter your plan, ERCOT is making sure that you get the most out of your electric service.
Texas summers are rarely considered mild, but 2011 is extreme even by the state’s standards. Texas temperatures this summer have routinely reached over the 100 degree Fahrenheit mark. In Dallas, for example, August 4 was the 34th consecutive day of temperatures 100 or above. According to senior meteorologist Jerry Paul at Thomson Reuters/Weather Insight, by early August this summer heat wave had reached temperatures last experienced in 1980, and in 1954 before that.
Whenever temperatures rise, energy consumption can be expected to rise as well due to continuously-running air conditioners. Multiple power consumption records have been set in the state this season, and at the beginning of August there were concerns that the Electric Reliability Council of Texas (ERCOT) would have to institute rotating power outages.
As mentioned previously on this site, this tactic was used in February 2011 when power plants were shut down by extreme cold weather. However, ERCOT was able to avoid implementing rolling outages during the first week of August by cutting power to “interruptible” customers.
Interruptible customers are those who are paid to have their power cut in emergency situations. According to the Reuters article “UPDATE 3-Texas avoids heat-related power disruption” from August 4, these customers mainly included larger industrial plants.
We’ve featured various articles on this site for limiting energy usage, especially during the summer months, but in times of excessive heat it is equally important to focus on your health. Here are some personal heat safety tips to remember during the summer:
• Reduce or eliminate strenuous activities during the hotter times of the day. Children and seniors especially should stay in the coolest space available during the day.
• Wear clothing that helps you stay cool, including light-colored clothing to reflect heat.
• Stay hydrated by drinking water and/or other non-alcoholic, decaffeinated fluids throughout the day. Make sure to drink even when you don’t feel thirsty.
• Stay out of the sun. While this seems obvious, there is another reason besides simply avoiding direct heat. If you get sunburned, your body’s ability to dissipate heat will be reduced. If you are out in the sun, put on sunscreen (SPF 15 or higher) 30 minutes before going out.
• Monitor those who are at higher risk for heat illness, including the very young, very old, overweight, and certain other groups.
• Do not leave children or pets in parked cars. Cars can heat up quickly even in lower temperatures, and the danger increases for higher temperatures.
(Based on information from NOAA’s National Weather Service and the CDC)
Be sure to read our previous articles for more information on how to limit your electricity use during the hot summer months. We will continue to bring you the information that matters about Texas’s electricity market, including your Texas electricity provider options.
On December 1, 2010, ERCOT launched the Texas nodal market. The development of this project began back in September of 2003, when the Public Utility Commission of Texas (PUCT) required the implementation of a new market design. In between, much work was done to create a market that serves Texas electricity customers better than ever.
But what exactly is a nodal market? Primarily, it’s an alternative to the previous zonal market design. Previously, ERCOT defined five different areas known as congestion management zones (CMZ). Unfortunately, these broad divisions actually contributed to congestion in the electricity market. According to the ERCOT Texas Nodal Market Implementation Archive, this zonal market had several other limitations as well.
With only five zones, there was insufficient price transparency, which was harmful for customers, and “indirect assignment of local congestion,” which means that the system was not as effective as it could have been. Power plants sometimes had to send power over a long distance to serve customers, resulting in higher costs and less reliable service.
The current nodal market switched from five broad zones to over 4,000 nodes. As you might expect, these more specific divisions help contribute to increased efficiency in the market as a whole. Now your local power plant is responsible for a much smaller area, which results in lower prices for generation, transmission, and distribution, and greater quality of service overall.
One of the other important changes that came with the switch to a nodal market was the creation of a Day Ahead Market. This allows for day-ahead price discovery, making it easier to optimize prices at each node.
The shift to a nodal market did not happen overnight.
According to the ChooseEnergy blog, many changes actually started in April 2010, continuing across the year until the launch on December 1. Customers interested in learning more about the current nodal market should be sure to check out the Texas Nodal Market Implementation Archive, which is still available on the ERCOT website. This site contains a variety of resources related to the shift from a zonal to nodal market, and makes the benefits of the new market design even clearer.
The shift of the Texas energy market from a zonal to nodal design is one of the most influential changes since the actual deregulation of the market in 2002. This change is yet another way that Texas customers can experience innovation when it comes to buying electricity. Be sure to continue checking our blog for more information on Texas electricity providers and you.
In Texas’s deregulated electricity market, it’s important that consumers be able to easily find information about different Retail Electric Providers. This helps when it comes to choosing the Retail Electric Provider that’s right for you. The Electric Reliability Council of Texas (ERCOT), which is responsible for operating the electric grid and managing the deregulated market, helps make sure that consumers have a number of resources in this regard.
One of ERCOT’s requirements for Texas Retail Electric Providers is that each REP offer a Texas electricity facts label. This page, which can generally be found on the provider’s website, gives the consumer clear information about three important things (some of this information comes from ElectricityTexas):
1. Electricity Price: Obviously, one of the most important things to know about any provider is the price. A provider’s electricity facts label will show the average price per kWh for 500 kWh, 1000 kWh, and 2000 kWh in each of their service areas. The average price includes the commodity and delivery charges for each area, as well as the monthly service charge. The three different usage levels make it easier for you to estimate what the price would be for your household.
2. Terms of Plan: Here is where you can find information regarding the specifics of the provider’s plan. First, you can discover whether the plan is based on a fixed, variable, or indexed rate, as well as how long the contract term is for fixed-rate plans. This section will also include any termination fees, as well as any other fees that may be charged. If your price can change during the contract period, you’ll find that here as well.
3. Information on Renewable Content: This section offers information on the provider’s electricity generation from renewable sources. Specifically, this section shows the percentage of electricity from renewable content, and also shows the statewide average for comparison.
If you want to find quick information about a Retail Electric Provider in one place, simply search for the provider’s Electricity Fact Label. This label should be able to help you decide if it makes sense to choose this provider over your current option, and will also let you know how long you can count on your prices staying the same. If you find that you still need more specific information, look at the provider’s official website or call to speak to a representative.
You can learn more about the different types of Texas electricity plans by checking out this earlier post. Continue checking this blog for more information on the Texas electricity topics that matter to you.
Electrical blackouts and power outages are never desirable, but the fact is that it is hard to completely eradicate them from the electrical market. Blackouts can be caused by a variety of different events:
• Squirrels: Squirrels foraging for food have been blamed for causing thousands of annual blackouts when they accidentally trip the internal breakers of an electrical substation. Some electricity providers now include “animal excluder” devices to reduce this risk, but squirrels often find a way past them.
• Severe Weather: When lightning hits a power transformer, it can cause a spike of voltage down the line. When this spike reaches a substation, it trips the breakers and causes a blackout. Ice, heavy winds, and tornadoes can also all affect electrical equipment in such a way as to cause a blackout.
• Human Accidents: A vehicle driven into a power line pole or piece of electrical equipment can result in power outages. This most commonly occurs when power lines are broken or touch.
• Overdrawing: When an excessive amount of power is required in a certain region of the grid, the overall electricity available will drop, possibly causing power outages for customers.
Power outages can last anywhere from a few seconds to a few weeks. Blackouts refer to the most extreme cases, when an area experiences a total loss of power.
In February 2011, the Electric Reliability Council of Texas (ERCOT) made the difficult decision to order rotating outages across the state, due to “a shortage of electricity as many utility plants tripped (shut off power) due to ‘extreme weather,’” according to the International Business Times.
The power outages were planned to last up to 45 minutes per neighborhood, but would not affect hospitals and nursing homes. Customers were urged to conserve electricity by turning off unnecessary appliances and lighting and only using the bare minimum in all other cases.
While power outages can be a hindrance, it is almost impossible to completely avoid them. Your choice of Retail Electric Provider in Texas should not overly affect your quantity of power outages, since providers in the same area will still receive their electricity from the same local utilities company.
ERCOT stands for the Electric Reliability Council of Texas. This non-profit industry group was formed in 1970, and now helps to monitor the electric supply in the state. In particular, ERCOT is responsible for overseeing the Texas Interconnection, the minor AC power grid that covers most of the state. According to the organization’s website, “[the] Electric Reliability Council of Texas ensures a reliable electric grid and efficient energy markets.”
ERCOT didn’t always hold this special position. The history of the company started back in 1941, when a number of Texas electric utilities combined their resources in order to aid the war effort. This collaboration was known as the Texas Interconnected System (TIS). The TIS then formed ERCOT almost 30 years later to comply with certain regulatory requirements.
In 1996, ERCOT gained the distinction of becoming the first Independent System Operator (ISO) in the US. This means that the organization became an impartial third party responsible for “overseeing equitable access to the power grid among the competitive market participants,” according to the official “History” page on the ERCOT website. When this happened, the organization’s Board of Directors restructured itself as a non-profit organization, which it remains to this day.
In recent years, the organization has introduced numerous developments to make its task easier, including market design changes to improve efficiency and a two-year-project to overhaul the electronic transaction system. In short, ERCOT continues to help make the Texas deregulated electricity market more efficient and easier to use for customers.
Most of the time, ERCOT is working behind the scenes to make sure electricity deregulation runs smoothly, and that you can enjoy the freedom to choose your Retail Electricity Provider (REP) without getting caught up in the hassle of acronyms and organizations. ERCOT itself is overseen by the Public Utility Commission of Texas (PUCT), the state agency which regulates both electric and telecommunications service.
If you have more questions about ERCOT, you can learn more about the organization’s goals, its history, and its services by visiting the website http://www.ercot.com/. Keep in mind that some of the information on this site is fairly technical, and you don’t need to read it all to be able to choose the best Texas electricity provider.
You can also visit the PUCT website (http://www.puc.state.tx.us/) for more consumer information on the state agency’s mission, or for consumer resources to help you find the best electric service in Texas.