POV: Power Breakfast

Power Breakfast for August 23, 2016

DOE funds 12 cybersecurity projects to improve infrastructure; Amtrak to implement community microgrid; UK to review coal policy post-Brexit

POV: Power Breakfast

A nearly daily update of energy-related news:

  • The DOE is providing up to $34 million towards 12 cybersecurity projects to improve the country’s energy infrastructure. The funds will cover five cybersecurity areas including: detecting and responding to operational threats, integrating renewables securely, reducing exposure, detecting malware already in the supply chain and identifying gaps in the cybersecurity roadmap released in 2011.
  • Amtrak is planning to implement a community microgrid on its transit system so that it can continue to operate in the event of a power outage. The proposed $31.3 million microgrid with operate with 17.2 MW of energy generation and 4 MWh of storage. Costs (operation, maintenance and fuel costs) total $7.2 million annually with forecasted revenue streams of $10 million annually.
  • The U.K.’s decision to leave the European Union could have ramifications on the country’s power supply and lead to a potential review of the U.K.’s policy on coal. As a non-EU member, the U.K. could be excluded from creating the rules that govern the EU’s wholesale power and gas markets leaving its energy market vulnerable.

As Peak Demand Keeps Rising in ERCOT, Records Fall

Powering Texas through the hot summer season

Lamar Power Plant, Luminant’s Combined-Cycle Natural Gas Plant

Lamar Power Plant, Luminant’s Combined-Cycle Natural Gas Plant

With the August heat above 100 degrees and covering much of Texas this week, the Electric Reliability Council of Texas set another record for peak power demand on Thursday between 4-5 p.m. of 71,197 megawatts. The previous record of 71,043 megawatts had just been set one hour earlier (between 3-4 p.m.). The new peaks set on Thursday blew past 71,000 megawatts for the first time and beyond the records set on Wednesday and Monday of this week.

To give you an idea of how much generation that is, one megawatt can power 200 homes in periods of high demand.

On these hot days when demand is at its highest, where does all that power come from?

ERCOT manages the flow of electric power to 24 million Texas customers, representing 90 percent of the state’s electric load. Luminant is the largest power generator in ERCOT.

The ERCOT grid relies on a diverse mix of energy sources that when all pulling together provide the power for this growing state. Here’s a breakout from ERCOT of which energy sources provided the power when Texans needed it most when Monday’s record was set:

  • 57% natural gas (includes combined cycle as well as traditional steam and combustion turbines)
  • 27% coal
  • 8% wind
  • 7% nuclear
  • 1% other (hydro, renewables, diesel)
    Note: Percentages are rounded
Forney Power Plant – Luminant’s Combined-Cycle Natural Gas Plant

Forney Power Plant – Luminant’s Combined-Cycle Natural Gas Plant

These numbers also underscore the importance of dependable power generation from natural gas, coal and nuclear energy.

Over the record peak hour on Monday, Luminant’s coal and gas plants and Comanche Peak Nuclear Power Plant helped supply nearly 15,000 megawatts to the grid.

“We strive for operational excellence, and on days like we’ve had this week, we’re reminded why it’s so important to work as a team to maintain safe and reliable operations,” said Steve Horn, Luminant chief fossil officer. “Our employees deserve immense credit for safely working in these extreme temperatures to help their fellow Texans stay safe and cool.”

With more hot days ahead, Luminant’s people, plants and mines are doing their part for safely powering Texas.

Luminant Response to the Texas Observer

Luminant_logo_sm300x189To no surprise, the Texas Observer piece on Luminant’s 2015 property tax litigation is an incomplete description of the company’s effort to reach fair taxable values at our plants that are much lower because of sustained low wholesale power prices.

Our goal is paying our fair share and without the court challenges, those valuations would result in the company paying excess property taxes for 2015. To suggest any other motive, as this article does, is inaccurate and cynical.

Although we provided the Texas Observer with extensive responses and data explaining how market forces drastically reduced plants revenue, income and property values and why power plants are valued differently from homes, those points were excluded leaving the reader with insufficient context.

Historically low natural gas prices and, increasingly, subsidized wind generation, especially since 2014, have driven power prices sharply lower with forecasts for them to remain low for years.

The Texas Observer implies homes and power plants for property tax purposes are valued the same through comparable sales. They’re not, despite material we gave to the reporter explaining the distinction. Unlike the residential market, there are very few sales of power plants that can provide a good comparable value.

The best, most accurate and sensible way to determine the fair taxable value of a power plant is by using what’s called a market-based income model. Market-based income models are widely relied on in Texas by owners of large industrial properties that are income-producing assets.

Counter to what the Texas Observer reported, we have shared with county appraisers for the past several years that many of our units have lost significant amounts of income – well into the tens of millions of dollars for 2015 alone. And our annual filings with the Securities and Exchange Commission have shown a steadily decreasing value for these same plants.

Just as plant values were higher when power prices, revenue and income were greater, values must now accurately reflect the impact of low prices. What remains constant is that as a longtime member of the communities where our plants, mines and many employees call home, we remain deeply concerned about their overall success.

Luminant Lignite Helps Power Geology Program at Museums Across Texas

Donated lignite samples to be used in geology presentations and educational kits

Mined lignite coal from Luminant’s Turlington Mine – normally used to fuel Big Brown Power Plant in Freestone County – is now generating educational opportunities at the Perot Museum of Nature and Science in Dallas. Donated lignite samples will be used in the museum’s geology presentations and in geology kits for teachers to use in their classrooms.

Ryan Holt (left), Turlington Mine superintendent, presents lignite samples to Tim Brys (right), Perot Museum teaching collection coordinator. Donated lignite samples will be used in the Perot Museum’s geology presentations and geology kits.

Ryan Holt (left), Turlington Mine superintendent, presents lignite samples to Tim Brys (right), Perot Museum teaching collection coordinator. Donated lignite samples will be used in the Perot Museum’s geology presentations and geology kits.

“Lignite is interesting to study because it was formed millions of years ago by the decomposition of plant material in swamp-like environments,” said Melinda Parker, Luminant senior geologist. “As the plant material was buried and compacted, increasing temperatures and pressures led to the formation of coal. Lignite is the lowest-ranking coal and is a reliable source of power generation.”

The Perot Museum also shared Luminant’s lignite samples with the Houston Museum of Natural Science, the Fort Worth Museum of Science and History, and the Nature Exchange at the Dallas Zoo.

Luminant’s goal is to quickly return mined land to productivity and achieve all regulatory reclamation obligations. For more than 40 years, Luminant has set the standard in mined land reclamation, restoring nearly 80,000 acres, planting more than 38 million trees and creating or enhancing more than 5,100 acres of wetlands, ponds and stream channels.


Luminant Lignite 101:

  • Luminant’s mining team produces lignite from the Calvert Bluff Formation – a major lignite-producing formation in the Texas Gulf Coast region.
  • Our mining team recently achieved the lowest injury rate in the nation among the largest mining companies, according to a review of the 2015 MSHA Recordable Injury Rates. Watch the latest Eye on Luminant video to find out how the team is digging into the record books.
  • Luminant mining is the largest mining company in Texas and the ninth largest in the United States.
POV: Power Breakfast

Power Breakfast for May 17, 2016

Preparing for a threat to the nation's power grid; DOE summit to preserve the country's nuclear reactors; Report shows a dramatic shift in Texas' energy mix

POV: Power Breakfast

A nearly daily update of energy-related news:

  • To counter the threat of attacks to the nation’s power grid, the power industry and U.S. government are considering implementing intentional blackouts across the country. Other measures in consideration include stockpiling rare transmission equipment, utilizing the latest cyberdefenses and coordinating responses between sectors. Marcus Sachs, NERC’s senior vice president and chief security officer, says “Industry continues to take the prospect of a cyber or physical attack on the bulk power system seriously.”
  • The DOE is sponsoring a summit on May 19 aimed at preserving the country’s nuclear reactors. Key industry representatives and legislators will meet to discuss the issues facing at-risk nuclear power plants and the potential consequences that could result from early plant retirements. NEI Senior Director of Business Policy, Matt Crozat, says, “Preserving existing nuclear power plants is imperative to any credible plan to reduce carbon emissions and necessary to preserve jobs in their host communities.”
  • According to a report by the Brattle Group, Texans could soon utilize natural gas, wind and solar energy for their power and shift away from power sourced from coal. The study provides an analysis of what the state’s energy mix could be if natural gas prices remain relatively low and the cost of solar energy continues to decline. In this scenario, the 2035 ERCOT grid would consist of 65 percent natural gas (up from 48 percent 2015), 12 percent wind energy (12 percent in 2015), 9 percent nuclear energy (down from 11 percent in 2015), 7 percent solar energy (~1 percent in 2015) and 6 percent coal (down from 28 percent in 2015). “I think we can learn some things from a study like this,” said Michael Nasi, general counsel for the group Balanced Energy For Texas, which includes several coal interests. “Please believe in the market because this study seems to tell you that you should not fear the market.”
POV: Power Breakfast

Power Breakfast for Apr. 26, 2016

DOE awards $3.5 million for hydropower development; China halts construction of 200 new coal power plants; Ikea to sell solar panels

POV: Power Breakfast

A nearly daily update of energy-related news:

  • The DOE has announced that it will award $3.5 million in funding for hydropower development. Hydropower currently provides approximately seven percent of the country’s electricity and is the nation’s leading source of renewable energy.
  • China has postponed its plans for the construction of roughly 200 new coal-fired power plants. These 200 plants would have been able to produce a total of 105 GW of power, more than the U.K.’s electricity-generating capacity from all sources.
  • Ikea stores in the U.K. are adding solar panels to the list of items that shoppers can buy towards the end of 2016. The country’s solar industry regulator reports that in February and March of 2016, U.K. households have installed solar capacity of 21 MW (each), down from the 81 MW that were installed during this same time in 2015. Despite these numbers, the retailer is making a second attempt at selling solar panels to this market. The first was in 2013-2014.
POV: Power Breakfast

Power Breakfast for Apr. 19, 2016

The Tesla Gigafactory to provide 35 GWh of energy storage; India's Energy Minister says solar is cheaper than coal

POV: Power Breakfast

A nearly daily update of energy-related news:

  • The Tesla Gigafactory outside of Reno, Nevada, which will manufacture batteries for Tesla’s electric cars, is forecasted to produce 35 GWh of energy storage a year for its vehicles. As reported on NPR, the factory has an estimated cost of $5 billion and will stand at 5.8 million square feet, roughly 100 football fields. To date, only 14 percent of the factory has been built. The factory will also manufacture larger versions of the Powerpacks for energy storage at factories, industrial sites and electric utilities.
  • While speaking about India’s action plan for renewables, the country’s Energy Minister, Piyush Goyal, said that solar energy is now cheaper than coal. He sates, “Of course there are challenges of 24/7 power. We accept all of that – but we have been able to come up with a solar-based long term vision that is not subsidy based.” India is on track to deploy more than 100 GW of solar power by 2022, beating its own goal for solar energy.
POV: Power Breakfast

Power Breakfast for Apr. 14, 2016

Wind, natural gas and solar made up 97 percent of all new electric generation capacity; Solar provided the U.K. with more power than coal; Energy storage set to rise

POV: Power Breakfast

A nearly daily update of energy-related news:

  • The EIA reports that wind, natural gas and solar made up 97 percent of all new electric generation capacity in 2015, accounting for 41 percent, 30 percent and 26 percent of total additions (respectively). The state of Texas added the most wind capacity at 42 percent of total U.S. wind additions. In 2015, California added more than 1,000 MW of utility-scale solar and 1,000 MW of distributed solar PV capacity. This accounted for 42 percent of overall solar additions.
  • Last weekend, solar power provided the U.K.  with more power than coal-fired power stations for 24 hours. The National Grid showed that 29 GWh of solar power was generated last Saturday versus 21 GWh of power from coal.
  • A study the research group EuPD found that only 34 percent of PV installers offer energy storage solutions to their customers.  However, 26 percent of the installers that currently do not offer solutions hope to begin in 2016. Additionally, 38 percent of the installers that do not offer solutions say that current battery prices prevent them from offering this service.