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TxEnergyUpdate - August 11, 2021

The TxEnergyUpdate keeps you up to date on the energy sector's latest news and stories



The Wall Street Journal took a deep dive into the recent solar power surge in the U.S. and Europe. Refining polysilicon requires a lot of electricity and is an essential process to developing solar panels. China has obtained a significant global advantage by using cheap coal: “Wacker Chemie AG, the West’s largest producer of solar-grade polysilicon, pays up to four times as much for power at its factories in Germany compared with Chinese producers in Xinjiang, said company spokesman Christof Bachmair.”

The American Bakers Association (ABA) is worried that demand for biofuels will cause shortages in soy and canola oils in the near future. These oils are essential ingredients to an array of baked goods. The concerns come as the Environmental Protection Agency (EPA) is considering changes to the Renewable Fuel Standard, which governs the amount of biofuel contained in gasoline. The ABA met with EPA officials to request they “lower biodiesel blending mandates to 2019 levels.”

U.S. utilities are building nuclear plants on a smaller scale. These plants, known as “small modular reactors,” or SMRs, are able to run all day and night with zero carbon emissions. They will also serve as a more reliable companion to renewables as utilities continue to pursue their emissions goals. “Our cities have a desire to distribute carbon-free electricity to their citizens, and we’re looking to replace our coal plants and eventually natural gas plants with carbon-free energy,” said Utah Associated Municipal Power Systems spokesman LaVarr Webb.”

Russia jumped Mexico to claim the title as the second largest oil importer to the United States. Imports to the U.S. “surged 23 per cent in May to 844,000 barrels a day.” Russia’s opportunity came from a shortage in oil from Venezuela due to sanctions and the Middle East enacting “OPEC-orchestrated output limits.” Canada remains the largest source of imported oil to the U.S.



- ERCOT MEETING(s) SUMMARY - August 9th & 10th

The Electric Reliability Council of Texas (ERCOT) met Monday and Tuesday via teleconference. The committee on Finance & Audit voted on the 2022-2023 ERCOT budget, which holds ERCOT’s funding mechanism, the system administration fee, at $0.55 per megawatt-hour for 2022-2023. The budget was approved by the Board of Directors.

Brad Jones, Interim CEO for ERCOT, stated that, by August 24th, 24 out of the 60 tasks that comprise ERCOT’s plan to improve grid reliability will be complete. A few more items of note from the CEO update: Mr. Jones briefed that June 23rd set a new June record for peak usage with 70,219 megawatts and solar and wind set new output records. Wind power produced 23,596 MW on June 25th and solar power is credited with producing 6,906 MW on July 31st.

Link to August 9th meeting: CLICK TO WATCH Link to August 10th meeting: CLICK TO WATCH

In a recent Op-ed, Texas Railroad Commissioner Jim Wright proposed tax credits for development of natural gas infrastructure. Commissioner Wright suggested leveling the playing field between natural gas and renewables, saying “Equalizing these [tax] incentives could assist with necessary infrastructure investments that guarantee ample supplies of this important Texas resource are available whenever they are needed.” Improving natural gas infrastructure ties into Texas’ efforts to bolster up grid reliability following the lessons learned from Winter Storm Uri.

ERCOT predicts power usage rivaling record highs this week, August 9th through the 15th, as Texas faces another heat wave. “The Electric Reliability Council of Texas (ERCOT), which operates most of the state's grid, projected power use will reach 73,754 megawatts (MW) on Monday, 74,093 MW on Tuesday and 74,375 MW on Wednesday.”

That's all for this edition of TxEnergyUpdate. Visit for further energy updates and publications.


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