ERCOT launches wholesale pricing forecast tool
AUSTIN, TX -- The Electric Reliability Council of Texas (ERCOT), which operates the electricity grid and facilitates the competitive electric market for most of Texas, now offers a new tool to help large electricity users make operational decisions based on anticipated electricity prices.
Consumers can look ahead to see what ERCOT expects real-time wholesale market prices to be during the next hour. The pricing forecasts, which are based on a non-binding study, are updated every five minutes in the Real-Time Market section of ERCOT’s website. (Select RTD Indicative LMPs by Resource Nodes, Load Zones and Hubs.)
“Large consumers, typically industries whose prices often reflect wholesale market prices, can use these pricing signals to help decide when it may be in their best interest to adjust their operations to reduce their electric use,” said ERCOT CEO Trip Doggett.
With the margin of electric generation capacity that exceeds electric demand falling below its targets in the coming years, ERCOT has been evaluating and implementing a variety of tools to help reduce electric use temporarily during periods of high consumption.
“In the coming years, we believe demand response — options to reduce power use during periods of highest demand — will become increasingly important to maintain a reliable electric grid and support the competitive electric market in Texas,” said Doggett. “Since prices are more likely to increase when generation supplies are tight, this price-responsive resource could help the market adjust the balance between generation and load when operating reserves drop to scarcity levels.”
These new indicative, forward-looking prices are non-binding, and actual real-time prices in the ERCOT market can change over the course of an hour as grid conditions change.
The Electric Reliability Council of Texas (ERCOT) manages the flow of electric power to 23 million Texas customers - representing 85 percent of the state's electric load. As the independent system operator for the region, ERCOT schedules power on an electric grid that connects 40,500 miles of transmission lines and more than 550 generation units. ERCOT also performs financial settlement for the competitive wholesale bulk-power market and administers retail switching for 6.6 million premises in competitive choice areas. ERCOT is a membership-based 501(c)(4) nonprofit corporation, governed by a board of directors and subject to oversight by the Public Utility Commission of Texas and the Texas Legislature.