U.S. Southwest gears up for power crunch as temperatures soar, rivers dry up

(Reuters) -Searing heat across the U.S. Southwest this week boosted electricity demand and prices to record highs and prompted power grid operators in Texas and California to urge energy conservation to avoid outages.

Grid operators in Texas and California both dealt with rotating outages over the last year to avoid widespread collapses of their power systems – California due to the heat in August 2020 and Texas in February 2021 after a deep freeze that left millions without heat – some for days.

Peak temperatures are forecast to reach 115 degrees Fahrenheit (46°C) in interior California through the week, according to the state’s electric grid operator, which warned the biggest supply deficit could occur on Thursday after the sun goes down and solar power is no longer available.

Much of the U.S. Southwest is also in the grip of exceptional drought, the worst possible category, that has already cut hydropower supplies. Rivers are running dry, ranchers are selling off livestock and authorities fear one of the worst wildfire seasons on record.

The conditions are part of a more than two-decade long drought in areas of New Mexico, Arizona, Colorado and Utah as climate change dries out the U.S. West.

Demand, mainly for air conditioning, boosted power prices for Thursday at the Palo Verde hub in Arizona to a record $1,420 per megawatt hour, compared with a five-year average of just $32.

The California Independent System Operator (ISO), which operates most of the state’s electric system, projected demand plus reserves would exceed power supplies for several days this week. Power grids keep reserves available to maintain reliability in case something goes wrong with a generating plant or transmission line.

The ISO forecast peak demand in California would rise from 40,909 megawatts (MW) on Wednesday to 43,323 MW on Thursday, compared with the all-time peak of 50,270 MW in July 2006. One hundred megawatts typically powers around 20,000 homes on a summer day.

Lower renewable power supplies could force California to rely more on natural gas-fired power plants this summer, revealing the challenge for the most-populous U.S. state to keep the lights on in coming years as it moves toward getting all electricity from carbon-free sources by 2045.

So far in 2021, hydro generated just 8% of the power produced in the California ISO versus 44% for gas. The rest came from solar (22%), wind (12%), nuclear (8%), coal (3%) and other (3%).

The ISO was currently getting about 7% of its power from other states, but warned that it would be unlikely to be able to rely on additional supplies from other states due to the extreme heat hitting much of the Western United States.

The Electric Reliability Council of Texas (ERCOT), which operates most of the state’s power system, projected demand would break the June record set on Monday in coming days.

ERCOT said demand reached 69,943 MW on Monday and is expected to reach 69,953 MW on Wednesday and 70,396 MW on Thursday. The state’s grid is separate from the rest of the country, so it can draw only small amounts of power from other grids to offset greater-than-normal demand.

In Houston, the biggest city in Texas, the mercury is expected to reach the upper 90s on Wednesday and Thursday, about five degrees higher than usual, according to AccuWeather.

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