Houston-area selected among 7 regions for $7B federal hydrogen hub investment

HyVelocity

The HyVelocity Hub, representing the Gulf Coast region, will receive $1.2 billion to strengthen and further build out the region's hydrogen production. Photo via Getty Images

Not only has a Houston-area project been announced as one of the seven regions to receive a part of the $7 billion in Bipartisan Infrastructure Law funding to advance domestic hydrogen production — but the Bayou City is getting one of the largest pieces of the pie.

President Biden and Energy Secretary Jennifer Granholm named the seven regions to receive funding in a White House statement today. The Gulf Coast's project, HyVelocity Hydrogen Hub, will receive up to $1.2 billion — the most any hub will receive, per the release.

“As I’ve stated repeatedly over the past years, we are uniquely positioned to lead a transformational clean hydrogen hub that will deliver economic growth and good jobs, including in historically underserved communities," Houston Mayor Sylvester Turner says in a news release. "HyVelocity will also help scale up national and world clean hydrogen economies, resulting in significant decarbonization gains. I’d also like to thank all the partners who came together to create HyVelocity Hub in a true spirit of public-private collaboration.”

Backed by industry partners AES Corporation, Air Liquide, Chevron, ExxonMobil, Mitsubishi Power Americas, Ørsted, and Sempra Infrastructure, the HyVelocity Hydrogen Hub will connect more than 1,000 miles of hydrogen pipelines, 48 hydrogen production facilities, and dozens of hydrogen end-use applications across Texas and Southwest Louisiana. The hub is planning for large-scale hydrogen production through both natural gas with carbon capture and renewables-powered electrolysis.

The project is spearheaded by GTI Energy and other organizing participants, including the University of Texas at Austin, The Center for Houston’s Future, Houston Advanced Research Center, and around 90 other supporting partners from academia, industry, government, and beyond.

“Prioritizing strong community engagement and demonstrating an innovation ecosystem, the HyVelocity Hub will improve local air quality and create equitable access to clean, reliable, affordable energy for communities across the Gulf Coast region,” says Paula A. Gant, president and CEO of GTI Energy, in a news release.

According to the White House's announcement, the hub will create 45,000 direct jobs — 35,000 in construction jobs and 10,000 permanent jobs. The other selected hubs — and the impact they are expected to have, include:

Tied with HyVelocity in terms of funding amount, the California Hydrogen Hub — Alliance for Renewable Clean Hydrogen Energy Systems (ARCHES) — will also receive up to $1.2 billion to create 220,000 direct jobs—130,000 in construction jobs and 90,000 permanent jobs. The project is expected to target decarbonizing public transportation, heavy duty trucking, and port operations.
The Midwest Alliance for Clean Hydrogen (MachH2), spanning Illinois, Indiana, and Michigan, will receive up to $1 billion. This region's efforts will be directed at optimizing hydrogen use in steel and glass production, power generation, refining, heavy-duty transportation, and sustainable aviation fuel. It's expected to create 13,600 direct jobs—12,100 in construction jobs and 1,500 permanent jobs.
Receiving up to $1 billion and targeting Washington, Oregon, and Montana, the Pacific Northwest Hydrogen Hub — named PNW H2— will produce clean hydrogen from renewable sources and will create over 10,000 direct jobs—8,050 in construction jobs and 350 permanent jobs.
The Appalachian Regional Clean Hydrogen Hub (ARCH2), which will be located in West Virginia, Ohio, and Pennsylvania, will tap into existing infrastructure to use low-cost natural gas to produce low-cost clean hydrogen and permanently and safely store the associated carbon emissions. The project, which will receive up to $925 million, will create 21,000 direct jobs—including more than 18,000 in construction and more than 3,000 permanent jobs.
Spanning Minnesota, North Dakota, and South Dakota, the Heartland Hydrogen Hub will receive up to $925 million and create around 3,880 direct jobs–3,067 in construction jobs and 703 permanent jobs — to decarbonize the agricultural sector’s production of fertilizer, decrease the regional cost of clean hydrogen, and advance hydrogen use in electric generation and for cold climate space heating.
Lastly, the Mid-Atlantic Clean Hydrogen Hub (MACH2), which will include Pennsylvania, Delaware, and New Jersey, hopes to repurposing historic oil infrastructure to develop renewable hydrogen production facilities from renewable and nuclear electricity. The hub, which will receive up to $750 million, anticipates creating 20,800 direct jobs—14,400 in construction jobs and 6,400 permanent jobs.

These seven clean hydrogen hubs are expected to catalyze more than $40 billion in private investment, per the White house, and bring the total public and private investment in hydrogen hubs to nearly $50 billion. Collectively, they aim to produce more than three million metric tons of clean hydrogen annually — which reaches nearly one third of the 2030 U.S. clean hydrogen production goal. Additionally, the hubs will eliminate 25 million metric tons of carbon dioxide emissions from end uses each year. That's roughly equivalent to annual emissions of over 5.5 million gasoline-powered cars.

“Unlocking the full potential of hydrogen—a versatile fuel that can be made from almost any energy resource in virtually every part of the country—is crucial to achieving President Biden’s goal of American industry powered by American clean energy, ensuring less volatility and more affordable clean energy options for American families and businesses,” U.S. Secretary of Energy Jennifer M. Granholm says in the release. “With this historic investment, the Biden-Harris Administration is laying the foundation for a new, American-led industry that will propel the global clean energy transition while creating high quality jobs and delivering healthier communities in every pocket of the nation.”

HyVelocity has been a vision amongst Houston energy leaders for over a year, announcing its bid for regional hydrogen hub funding last November. Another Houston-based clean energy project was recently named a semi-finalist for National Science Foundation funding.

“We are excited to get to work making HyVelocity come to life,” Brett Perlman, president and CEO of Center for Houston’s Future, says in the release. “We look forward to spurring economic growth and development, creating jobs, and reducing emissions in ways that will benefit local communities and the Gulf Coast region as a whole. HyVelocity will be a model for creating a clean hydrogen ecosystem in an inclusive and equitable manner.”

When examining how you can better prepare and respond to ongoing climate-related challenges, the CRE community needs to prioritize marginalized communities that are already experiencing most of the negative impacts. Photography by Peter Molick

Experts: How to better prepare Houston to combat climate related challenges

guest column

Houston is no stranger to hurricanes, and in recent years winter storms have become an increasing concern. Following the winter freeze in 2021, more than 4 million Texans were left without power, water, or heat. The state’s infrastructure system was adversely impacted concurrently — including workplaces, hospitals, transportation, homes, drinking water distribution, electric power generation, agriculture, and grocery stores. Now, a new potential disaster is on the horizon. Recent research shows Houston is most likely to be affected by wildfires, a climate-related challenge that our city has not previously faced.

According to the Gensler Research Institute’s 2022 U.S. Climate Action Survey, since 2019, only 18 percent of Americans believe their communities are built to withstand climate change. The good news is Americans overwhelmingly agree that addressing climate change is urgent. The question many are asking is — “How can we take action to better prepare buildings and cities to weather the climate challenge?” The solution is simple. In order to understand where we need to go, we must understand how we got here.

With a population that has more than doubled in the past 50 years, it is challenging for most Houstonians to imagine a time when The Bayou City was nothing more than agricultural lands and oil fields. Today, Houston is known for being the fourth-most populous city in the United States. It is a sprawling concrete jungle home to the world’s largest concentration of healthcare and research institutions. When reflecting on the past 50 years, one can’t help but evaluate the city’s successes and shortcomings. While Houston has succeeded in becoming a diverse, international city, we have sacrificed the very ecology that once made up one of the country’s most productive agricultural areas. By 1980, Houston possessed the least amount of green space per person in the country.

As new developments popped up across the city, it became difficult to convince developers to pursue third-party certifications such as LEED, a globally recognized symbol of sustainability that provides the framework for designing healthy, efficient, carbon saving buildings. We can credit Hines with being one of the few developers in Houston to prioritize green design during the early-2000s. City leaders also began advocating for resilient strategies and more green space to attract and retain international talent and businesses. In recent years, we have seen an increase in buildings that are achieving LEED certification, and soon it will become the baseline.

The Houston Advanced Research Center, Photography by Shau Lin Hon, Slyworks Photography

An example of a project leading the way for resilient design is The Houston Advanced Research Center (HARC). In 2017 the organization completed work on its LEED Platinum Certified headquarters which was designed to meet the ENERGY STAR certification rate of 99 (out of 100). This means that the building is more efficient than 99 percent of all office buildings in the United States. Skanska is another construction and development company bringing a sustainable mindset to downtown Houston with its work on Bank of America Tower. In 2019, the 775,000 square foot building became the largest LEED v4 Platinum Core and Shell certified project in the world to date and was developed with harvesting technology that will significantly reduce energy usage.

It’s also important to understand the impact that the climate crisis is having on people. 91 percent of U.S. Gen Z/Millennials have been affected by extreme weather events since 2019, the most of any generation. These experiences have resulted in two generations preparing to react and combat climate change and has encouraged a spirit of transparency among companies who choose to share their environmental goals and strategies.

For architects and designers, addressing building and energy codes is proving to be the next big design consideration. As codes progress in the coming years, the result will be more unique and unexpected building designs.

When reimagining the use of buildings, Architects Paulina Abella and Tayler Trojcak propose an experimental process for repurposing vacant buildings called High Hackers. The concept provides an opportunity for developers to offer prime downtown real estate to people with diverse skill sets, whom they call “hackers,” to pursue projects shaped by their individual ideas. These hackers—makers, artists, and academics—will work alongside one another in spaces that encourage them to coexist with creatives from other fields and disciplines. More importantly, it fosters a collaborative, organic, and innovative workflow.

When examining how you can better prepare and respond to ongoing climate-related challenges, we encourage prioritizing marginalized communities that are already experiencing most of the negative impacts. Promoting awareness and optimism in our communities is another simple yet effective way to make a difference. For businesses, creating a sense of continuity in the face of climate events, investing in energy and resource efficiency and adaptation, and addressing insurability and the long-term value of real estate will ultimately help lead Houston and its community members toward a place of preparedness and resiliency.

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Rives Taylor directs Gensler’s Global Design Resilience teams and initiatives and has been a faculty member of both Rice University and the University of Houston for 30 years. Maria Perez is a design resilience leader for Gensler’s South Central region and director of sustainable design based in Gensler’s Houston office.

This article originally ran on InnovationMap.

How can Houston's energy transition be built with the city's communities in mind? Through trust, public education, and intention, according to a panel of experts. Photo via Getty Images

Why it would be 'potentially catastrophic' not to include communities in the energy transition

overheard

As the energy sector transitions toward a more sustainable future, a Houston organization is driving forward the idea to do so with a community-based approach, as some experts discussed at a recent breakfast panel.

The Center for Houston's Future hosted a breakfast discussion on August 10, entitled "Building a Community-Based Approach to the Energy Transition," sponsored by BP Energy. The conversation covered various ways corporations, organizations, and individuals could work together to build this approach, including through education, upskilling, collaborations, and more.

Photo by Laura Goldberg/Center for Houston's Future on LinkedIn

The event kicked off with a keynote address from Brad Townsend, vice president of policy and outreach at the Center for Climate and Energy Solutions, who set the scene for the discussion.

“The energy transition offers an opportunity to build a thriving, just, and resilient net-zero economy that can benefit companies and communities alike" he says to the crowd. "It’s the chance to raise jobs standards and safely through local and federal policies, employ a practice change, cross-sector collaboration, and worker training.

“It's also an opportunity to diversify the workforce to better reflect local communities, including in Houston," he continues. "If we approach this engagement however as a box checking exercise or unwilling to really provide communities an opportunity to help shape projects, we’re destined to fail. Being genuinely open to feedback from communities and actively incorporating them into the decision-making process is foundational to generating the community buy-in that will be crucial to a successful energy transition.”

Here were some of the key takeaways from the event.

"When we talk about Houston we need to be cognizant that it is a huge geographical area, and you cannot speak to Houston as a monolith. You can't even speak to individual communities as single entities."

— Anne Bartlett, vice president of industry and community resources at Brazosport College.

"Our responsibility is to recognize and really understand our communities not just from labor market data perspective, but also by having conversations with people who know what’s happening on the ground," she continues. "Our charge is to recognize that yes, this is a regional opportunity but it really does need to be situationalized in our specific communities and recognize the strengths and the opportunities that are present in all of those."

"One of the opportunities and challenges that's part of this massive energy transition, which I think will not only bring about investments of billions of dollars but potentially trillions of dollars, is to utilize these significant investments as an opportunity to not only transform how we make, use, and transport energy, but also uplift these communities that are adjacent to the facilities where hydrogen and other resources will be will be produced."

— John Hall, president and CEO of Houston Advanced Research Center.

"We (need to) use this entire transformational effort to open the doors of opportunity for every community," he adds.

“While it is the right thing to do to bring in the full breath of diversity that we have, it's (also) absolutely necessary.”

— Mark Crawford, senior vice president at BP Energy.

"We're in in Houston. We are the most diverse city in the United States, and the United States is becoming more and more diverse," he explains.

"It is important to bring holistic solutions to communities. ... We can't do everything, but there are organizations working on the ground that are doing really great work. It's about companies going in and partnering with stakeholders on the ground who understand the communities so that we are bringing these wrap-around services."

— Crawford continues, noting that it's on companies like BP to tap into and support local entities.

“There's a fundamental shift that needs to happen in the way that we're talking about these jobs to really encourage young people to take advantage of resources that are made available, because we can integrate that into the educational curriculum, but unless students and young people are willing to move in that direction it's not going to make a difference.”

— Townsend says on the panel, addressing the sentiment that young people are told job security comes only with a college degree. The panelists agree this isn't the case anymore, yet that message is still being conveyed.

“I think it's really important to pull back and recognize the opportunity that's in the K-12 space — not only with the children and making sure that they're aware that these careers even exist, but perhaps just as importantly with their parents.”

— Bartlett says, adding that these kids will be the ones in thes jobs in 10 or so years, so that message needs to start being conveyed now.

“All of these things cost money. There are dollars that are out there right now that we are not leveraging — there are dollars that are available through the Texas Workforce Commission, through Chambers of Commerce. So, we're not talking about having to reinvent the wheel and having to go to our industry partners with palms up, we're talking about leveraging the resources that are already out there in a wiser way.”

— Bartlett says about the feasibility of workforce development programs.

“It would be unfortunate — (and) it would be potentially catastrophic — if we see the trillions and trillions of dollars invested over the next 20 years, and we have left behind 25 percent or more of citizens.”

— Hall says, emphasizing how important working with communities — and hearing their concerns — is to this process.

He later adds that he's worked with community leaders, and he knows they are optimistic — as is he — about this process. “These are not peculiar human beings. They have the same hopes and dreams that we have, and if we will take the step to just reach out and connect and communicate with sincerity, then those barriers are easier to overcome.”

The convergence of green banking with evergreen experimentation in support of a growing green economy sounds like just the right shade of green. Photo by micheile henderson/Unsplash

Green banking meets evergreen R&D with recent MOU

MONEY + MATTER

The term “Energy Transition” doesn’t merely imply change, it demands it. And with change comes another kind of change–usually of the dollars and cents kind.

While many aspire to embrace more sustainable and cleaner energy solutions in their communities, the affluence needed to deploy necessary infrastructure often sits just outside of reach. Until now, that is.

With the rise of “green banking,” securing financing for the adoption of energy efficiency, implementation of decarbonization technologies, and broader provision of renewable energy is now more accessible. Funds at green banks, backed by a blend of public and philanthropic contributions, tap into the modern trend of crowdfunding to support egalitarian and climate improvement efforts.

However, green bank financing is structured with repayment of–or a return on–capital expected at the end of the term, meaning approval tends only to be granted to proven and established projects well past the research and development stage. Given the Energy Transition is, for the most part, still in its infancy, clearing such hurdles can be difficult.

But Houston is full of dreamers and doers; researchers and entrepreneurs eager to tackle the next big challenge. It would come as no surprise then, that Texas’ first green bank, the Clean Energy Fund of Texas (“CEFTx”), bucks tradition with a novel Memorandum Of Understanding (“MOU”) co-signed by the Houston Advanced Research Center (“HARC”) to finance efforts staunchly entrenched in R&D activity.

As the Energy Transition foothold grows, Houstonians are compelled not just to invest in green initiatives, but to drive them. Which only makes sense, considering the deep expertise in energy innovation led most recently by the Houston-area shale revolutionaries from Mitchell Energy. Established over 40 years ago by George P. Mitchell himself, HARC plants the seeds of transformation at the intersection of science, resilience, sustainability, and the environment.

Per the March 29 news release from CEFTx, John Hall, President & CEO of HARC says, “We are excited to join forces with the team at Clean Energy Fund of Texas as they drive green investment in low-income and disadvantaged communities. Our research expertise and experience in managing state and federal grants will be a true benefit to Texans.”

The recent MOU brings Energy Transition visionaries the capital necessary to explore, test, develop, and deploy innovative solutions from conception to maturity. Entrepreneurs at all stages of the business lifecycle are encouraged to apply for funding on the CEFTx website or connect with HARC at an upcoming event to discover how the two entities can take ideas from dream to reality.

“It’s an honor to work with the esteemed researchers at HARC, who have been studying sustainability for decades,” says Stephen Brown of CEFTx in the release. “Together we can be even more effective at kickstarting investments in solar power, retrofits, and other technologies that help create the green workforce of tomorrow.”

The fresh approach to funding set up by CEFTx and HARC positions new companies to succeed and enables existing companies to progress in the transition to a more sustainable #futureofenergy. It’s just the sort of sense that is needed to truly drive change.

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Houston companies scoop up $31 million in funds from DOE, EPA methane emissions program

fresh funds

The U.S. Department of Energy and the U.S. Environmental Protection Agency announced the selection of seven projects from Houston companies to receive funding through the Methane Emissions Reduction Program.

The projects are among 43 others nationwide, including 12 from Texas, that reduce, monitor, measure, and quantify methane emissions from the oil and gas sector. The DOE and EPA awarded $850 million in total through the program.

The Houston companies picked up $31.7 million in federal funding through the program in addition to more than $9.5 million in non-federal dollars.

“I’m excited about the opportunities these will create internally but even more so the creation of jobs and training opportunities for the communities in which we work,” Scott McCurdy, Encino Environmental Services CEO, said in a news release. His company received awards for two projects.

“These projects will allow us to further support and strengthen the U.S. Energy industry’s ability to deliver clean, reliable, and affordable energy globally,” he added.

The Houston-area awards included:

DaphneTech USA LLC

Total funding: $5.8 million (approximately $4.5 million in federal, $1.3 million in non-federal)

The award was granted for the company’s Daphne and Williams Methane Slip Abatement Plasma-Catalyst Scale-Up project. Daphne will study how its SlipPure technology, a novel exhaust gas cleaning system that abates methane and exhaust gas pollution from natural gas-fueled engines, can be economically viable across multiple engine types and operating conditions.

Baker Hughes Energy Transition LLC

Total funding: $7.47 million (approximately $6 million in federal, $1.5 million in non-federal)

The award was granted for the company’s Advancing Low Cost CH4 Emissions Reduction from Flares through Large Scale Deployment of Retrofittable and Adaptive Technology project. The project aims to develop a scalable, integrated methane emissions reduction system for flares based on optical gas imaging and estimation algorithms.

Encino Environmental Services

Total funding: $15.17 million (approximately $11 million in federal, $4.17 million in non-federal)

The award was granted for two projects. The Advanced Methane Reduction System: Integrating Infrared and Visual Imaging to Assess Net Heating Value at the Combustion Zone and Determine Combustion Efficiency to Enhance Flaring Performance project aims to develop and deploy an advanced continuous emissions monitoring system. It’s Advancing Methane Emissions Reduction through Innovative Technology project will develop and deploy a technology using sensors and composite materials to address emissions originating in storage tanks.

Envana Software Solutions

Total funding: $5.26 million (approximately $4.2 million in federal, $1 million in non-federal)

The award was granted for the company’s Leak Detection and Reduction Software to Identify Methane Emissions and Trigger Mitigation at Oil and Gas Production Facilities Based on SCADA Data project. It aims to improve its Recon software for monitoring methane emissions and develop partnerships with local universities and organizations.

Capwell Services Inc.

Total funding: $4.19 million (approximately $3.3 million in federal, $837,000 in non-federal)

The award was granted for its Methane Emissions Abatement Technology for Low-Flow and Intermittent Emission Sources project. It aims to to deploy and field-test a methane abatement unit and improve air quality and health outcomes for communities near production facilities and establish field technician internships for local residents.

Blue Sky Measurements

Total funding: $3.41 million (approximately $2.7 million in federal, $683,000 in non-federal)

The award was granted for its Field Validation of Novel Fixed Position Optical Sensor for Fugitive Methane Emission Detection Quantification and Location with Real-Time Notification for Rapid Mitigation project. It aims to field test an optical sensing technology at six well sites in the Permian Basin.

Southern Methodist University, The University of Texas at Austin, Texas A&M Engineering Experiment Station and Hyliion Inc. were other Texas-based organizations to earn awards. See the full list of projects here.

Texas university's 'WaterHub' will dramatically reduce water usage by 40%

Sustainable Move

A major advancement in sustainability is coming to one Texas university. A new UT WaterHub at the University of Texas at Austin will be the largest facility of its kind in the U.S. and will transform how the university manages its water resources.

It's designed to work with natural processes instead of against them for water savings of an estimated 40 percent. It's slated for completion in late 2027.

The university has had an active water recovery program since the 1980s. Still, water is becoming an increasing concern in Austin. According to Texas Living Waters, a coalition of conservation groups, Texas loses enough water annually to fill Lady Bird Lake roughly 89 times over.

As Austin continues to expand and face water shortages, the region's water supply faces increased pressure. The UT WaterHub plans to address this challenge by recycling water for campus energy operations, helping preserve water resources for both the university and local communities.

The 9,600-square-foot water treatment facility will use an innovative filtration approach. To reduce reliance on expensive machinery and chemicals, the system uses plants to naturally filter water and gravity to pull it in the direction it needs to go. Used water will be gathered from a new collection point near the Darrell K Royal Texas Memorial Stadium and transported to the WaterHub, located in the heart of the engineering district. The facility's design includes a greenhouse viewable to the public, serving as an interactive learning space.

Beyond water conservation, the facility is designed to protect the university against extreme weather events like winter storms. This new initiative will create a reliable backup water supply while decreasing university water usage, and will even reduce wastewater sent to the city by up to 70 percent.

H2O Innovation, UT’s collaborator in this project, specializes in water solutions, helping organizations manage their water efficiently.

"By combining cutting-edge technology with our innovative financing approach, we’re making it easier for organizations to adopt sustainable water practices that benefit both their bottom line and the environment, paving a step forward in water positivity,” said H2O Innovation president and CEO Frédéric Dugré in a press release.

The university expects significant cost savings with this project, since it won't have to spend as much on buying water from the city or paying fees to dispose of used water. Over the next several years, this could add up to millions of dollars.

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A version of this story originally appeared on our sister site, CultureMap Austin.

Report: Texas solar power, battery storage helped stabilize grid in summer 2024, but challenges remain

by the numbers

Research from the Federal Reserve Bank of Dallas shows that solar power and battery storage capacity helped stabilize Texas’ electric grid last summer.

Between June 1 and Aug. 31, solar power met nearly 25 percent of midday electricity demand within the Electric Reliability Council of Texas (ERCOT) power grid. Rising solar and battery output in ERCOT assisted Texans during a summer of triple-digit heat and record load demands, but the report fears that the state’s power load will be “pushed to its limits” soon.

The report examined how the grid performed during more demanding hours. At peak times, between 11 a.m. and 2 p.m. in the summer of 2024, solar output averaged nearly 17,000 megawatts compared with 12,000 megawatts during those hours in the previous year. Between 6 p.m. and 9 p.m., discharge from battery facilities averaged 714 megawatts in 2024 after averaging 238 megawatts for those hours in 2023. Solar and battery output have continued to grow since then, according to the report.

“Batteries made a meaningful contribution to what those shoulder periods look like and how much scarcity we get into during these peak events,” ERCOT CEO Pablo Vegas said at a board of directors conference call.

Increases in capacity from solar and battery-storage power in 2024 also eclipsed those of 2023. In 2023 ECOT added 4,570 megawatts of solar, compared to adding nearly 9,700 megawatts in 2024. Growth in battery storage capacity also increased from about 1,500 megawatts added in 2023 to more than 4,000 megawatts added in 2024. Natural gas capacity also saw increases while wind capacity dropped by about 50 percent.

Texas’ installation of utility-scale solar surpassed California’s in the spring of last year, and jumped from 1,900 megawatts in 2019 to over 20,000 megawatts in 2024 with solar meeting about 50 percent of Texas' peak power demand during some days.

While the numbers are encouraging, the report states that there could be future challenges, as more generating capacity will be required due to data center construction and broader electrification trends. The development of generating more capacity will rely on multiple factors like price signals and market conditions that invite more baseload and dispatchable generating capacity, which includes longer-duration batteries, and investment in power purchase agreements and other power arrangements by large-scale consumers, according to the report.

Additionally, peak demand during winter freezes presents challenges not seen in the summer. For example, in colder months, peak electricity demand often occurs in the early morning before solar energy is available, and it predicts that current battery storage may be insufficient to meet the demand. The analysis indicated a 50% chance of rolling outages during a cold snap similar to December 2022 and an 80% chance if conditions mirror the February 2021 deep freeze at the grid’s current state.

The report also claimed that ERCOT’s energy-only market design and new incentive structures, such as the Texas Energy Fund, do not appear to be enough to meet the predicted future magnitude and speed of load growth.

Read the full report here.

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