Even from California, I feel this. Our bills have spiked too, and while some of it is clearly tied to utility mismanagement and fire mitigation costs here, there’s no denying that climate-driven demand shifts are part of the story. What you showed about the nonlinear jump in electricity prices once the grid hits its limit really hits home. We had rolling blackout threats during the last few heat waves and the tension between personal conservation and grid-level scarcity felt very real.
The idea that we’re all quietly paying a climate surcharge not for resilience or grid improvements but just to keep fossil-based generators profitable is frustrating. Especially because there’s no real opt-out. Even rooftop solar here only helps if you can afford the upfront cost, and TOU pricing doesn’t fully protect you when the system is stretched thin.
From the article title, I thought you would explain how rapid deployment of wind and solar energy was raising electricity prices. Just kidding.
Of course, we'd expect hotter temperatures to increase demand for air conditioning in Texas. Likewise, we'd expect hotter temperatures to decrease demand for heating in Texas, as well as Buffalo and Montreal. The decreased heating might not show up in electricity consumption, since most heating comes from oil and natural gas. Certainly, some (hotter) areas of the world will need more energy on net, while other (colder) areas will likely need less. Which effect is greatest on a global level might be an interesting topic.
But as is often pointed out, further warming is extremely likely but not likely catastrophic. To me, the most obvious implication is that adaptation to climate change will require efforts to provide the most economical energy sources. Rapid decarbonization will do little to reduce warming, but a lot to reduce affordability of energy.
I ran your last paragraph through ChatGPT with this query: "Can you tell me if the following paragraph is valid/reasonable/logical?" Quite interesting!
You're looking at electricity only, right? Those who use piped gas or propane for space heating will presumably save some money. Have you estimated that, or do you at least know what fraction of Texas households use only electricity for space heating?
Hi Andy, this is a great post. I have one ask: for the "Demand-weighted daily average price vs daily average demand for 2023" figure - could you split this into summer months and winter months? I'm curious as to whether the price/demand relationship changes. A couple of reasons why it might: 1) higher temperatures make power plants less efficient, so we might expect the price/demand slope to increase faster in summer for that reason. 2) winter months have less available solar, so that might lead to a higher price/demand slope in winter. 3) other things I can't predict the direction of - e.g., is wind more available in summer or winter? 4) unknown unknowns. Thanks! -Marcus
Do you have any idea what value for the average Summer temperature would break Ercot's ability to provide enough electricity to consumers to keep their homes at a livable T? I wouldn't be surprised if we were approaching that point.
Nice analysis!
Even from California, I feel this. Our bills have spiked too, and while some of it is clearly tied to utility mismanagement and fire mitigation costs here, there’s no denying that climate-driven demand shifts are part of the story. What you showed about the nonlinear jump in electricity prices once the grid hits its limit really hits home. We had rolling blackout threats during the last few heat waves and the tension between personal conservation and grid-level scarcity felt very real.
The idea that we’re all quietly paying a climate surcharge not for resilience or grid improvements but just to keep fossil-based generators profitable is frustrating. Especially because there’s no real opt-out. Even rooftop solar here only helps if you can afford the upfront cost, and TOU pricing doesn’t fully protect you when the system is stretched thin.
From the article title, I thought you would explain how rapid deployment of wind and solar energy was raising electricity prices. Just kidding.
Of course, we'd expect hotter temperatures to increase demand for air conditioning in Texas. Likewise, we'd expect hotter temperatures to decrease demand for heating in Texas, as well as Buffalo and Montreal. The decreased heating might not show up in electricity consumption, since most heating comes from oil and natural gas. Certainly, some (hotter) areas of the world will need more energy on net, while other (colder) areas will likely need less. Which effect is greatest on a global level might be an interesting topic.
But as is often pointed out, further warming is extremely likely but not likely catastrophic. To me, the most obvious implication is that adaptation to climate change will require efforts to provide the most economical energy sources. Rapid decarbonization will do little to reduce warming, but a lot to reduce affordability of energy.
I ran your last paragraph through ChatGPT with this query: "Can you tell me if the following paragraph is valid/reasonable/logical?" Quite interesting!
You're looking at electricity only, right? Those who use piped gas or propane for space heating will presumably save some money. Have you estimated that, or do you at least know what fraction of Texas households use only electricity for space heating?
We must tame our wasting habits.
Hi Andy, this is a great post. I have one ask: for the "Demand-weighted daily average price vs daily average demand for 2023" figure - could you split this into summer months and winter months? I'm curious as to whether the price/demand relationship changes. A couple of reasons why it might: 1) higher temperatures make power plants less efficient, so we might expect the price/demand slope to increase faster in summer for that reason. 2) winter months have less available solar, so that might lead to a higher price/demand slope in winter. 3) other things I can't predict the direction of - e.g., is wind more available in summer or winter? 4) unknown unknowns. Thanks! -Marcus
I just made that plot and it looks basically the same.
Thank you for looking into it - sorry the effort turned out to be for naught.
Do you have any idea what value for the average Summer temperature would break Ercot's ability to provide enough electricity to consumers to keep their homes at a livable T? I wouldn't be surprised if we were approaching that point.
I would say that, if the average Texas temp gets to around 40C, it would be a real challenge for ERCOT.
Nicely done! It will be interesting to know whether other jurisdictions use your methods.
I'm actually working on an analysis for other RTOs in the U.S.