As Texas braces for predicted tighter electricity reserves and higher electricity rates this summer, a new report from the Brattle Group shows that adding solar capacity to the Texas electric grid would result in lower wholesale electricity prices for customers in the state.
Analysts at The Brattle Group reviewed Texas electricity market data from summer 2011 and analyzed how prices would have been impacted if solar photovoltaic (PV) systems had been added to the generation mix.
The report concludes that adding solar PV to the Texas electric grid last summer could have saved customers an average of $155/MWh to $281/MWh. Avoiding fuel, operations and maintenance costs associated with fossil-fuel plans could have saved customers an additional $52/MWh. Taken together, the total customer benefits of adding solar PV to the Texas grid was valued at more than $520 million, according to the report.
Pat Wood, former chairman of the Public Utility Commission of Texas and of the Federal Energy Regulatory Commission, says solar is a natural fit for Texas' energy capacity problems because solar electricity production peaks during afternoon hours, when summer electricity demand is highest.
"Texas needs more on-peak capacity," Wood says. "Solar delivers on peak, it doesn't use water and it doesn't create any smog pollution. It is increasingly affordable, competing favorably with other peak-of-the-day resources."
During last year's unseasonably hot summer, the Electric Reliability Council of Texas was forced to issue six conservation alerts because of record electricity usage in the state, resulting in electricity shutoffs for customers who volunteered for cutbacks during emergency conditions.
Similar capacity issues could occur this summer. According to an analysis released May 30 by the North American Electric Reliability Corp., Texas electricity reserves "will challenge operations this summer" because "resource-adequacy levels have fallen below targets."
"This study shows that not only can solar energy help lower costs for Texans, but that adding solar capacity helps address the state's more urgent crisis of potential rolling blackouts during the hot summer months," says Carrie Cullen Hitt, vice president of state affairs for the Solar Energy Industries Association. "The state's electricity grid was pushed to the brink of failure last summer. As Texas leaders address ways to mitigate this risk and the state's energy future, solar should be an important part of their plans."
