Jan 7 2014, 4:30am CST | by Forbes
It’s usually in the Dog Days of summer when the air conditioners are roaring that Texas worries about outstripping its power grid. But on Monday morning, with temperatures plunging to 10 degrees in Fort Worth, Texans’ power consumption soared.
What’s more, the cold and other problems knocked out a handful of power plants, amounting to 3,700 mw of electricity. The Electric Reliability Council of Texas issued an emergency alert Monday morning. Any worse and the next step would have been rolling blackouts. To make ends meet Monday morning, Texas had to import electricity from outside the state, including Mexico.
With another Three Dog Night forecast for overnight into Tuesday, the stresses continue.
The cold also impacts oil and gas wells across the region. Valves freeze up, and fracking fluids don’t flow like they’re supposed to.
Naturally, the roughnecks working North Dakota’s Bakken fields (where its expected to get as low as -40 degrees tonight) would laugh at their wussy Texas counterparts complaining of 10 degrees, but we’re not used to temperatures like this down here.
The last time it got this cold in Texas was 2011, when hundreds of natural gas wells froze shut and the state set a winter power usage record of 57,265 MW. Tuesday is expected to hit 56,818 MW.
There is money to be made from such emergency situations. Power prices capped out at $5,000 per megawatt-hour Monday morning. The average power price is more like $50 per Mwh. That could mean a short-lived windfall for the likes of Energy Future Holdings, NRG Energy, Calpine and Panda Power.
A few more cold spells like this might be enough to convince these companies to invest in some new power plants.
Source: Forbes Business
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