Texas has a grid demand solution

Good morning. A story we’re tracking here at EC: A slew of lawsuits against state and city governments (see: Vermont, San Diego, and Maine) alleging municipalities and state departments of energy aren’t doing their part to reach emissions goals. We’re wondering: Do you think emissions goals are too tough to track at scale? Hit reply and let’s talk about it.

—Reagin von Lehe, Energy Central Newsletter Writer

Are Giant Batteries the Answer to Sky High Demand?

To meet unprecedented increases in energy demand, the US is rapidly deploying grid-scale batteries—and Texas is giving battery capacity leader California a run for its money.

Driving the news: Last month, Jupiter Power debuted Houston’s first-of-its-size grid-scale battery energy storage system (aka BESS) with 200 MW of capacity to help stabilize the state’s power grid. Some background ➡️ 

• Texas started accelerating storage installations in late April after a heat wave with temps north of 100 degrees threatened power supply to ERCOT’s 26 million customers.

• Longer term, though, much of the grid-scale battery market’s success from startups like Jupiter Power, Eolian Power, and GridStor in the Lone Star State can be chalked up to a low-regulation, business-friendly landscape.

For context: Grid-scale batteries are managed by utilities or independent power producers (IPPs), and one system can supply over 100 MW of electricity to the surrounding region. States including California, New York, and Massachusetts have rolled out new policies this summer to jumpstart grid-scale development.

What’s behind the push? Power demand is projected to rise to a record of more than 4,000 billion kWh in 2024. That congestion raises the wholesale cost of power, a burden often passed to consumers. Grid-scale battery solutions store excess electricity and release it during peak hours to ease congestion.

Looking ahead: Grid-scale storage isn’t a silver bullet for overwhelming demand increases. It can incur long interconnection wait times (storage projects take about 3.5 years to complete the ERCOT backlogged interconnection process) and costs are high (even though BESS prices have decreased by 18% in 2024, cells still cost about $148 per kWh).

But with ERCOT’s help, the US saw 4.2 GW of battery capacity added to the national grid from January to June, and another 10 GW of storage could be underway this year.

Back to School in Big Yellow Batteries

East Oakland, California, is the first major US school district to transition to a 100% electrified school bus fleet, launching this week as part of a larger effort by San Francisco-based startup Zum to turn school bus fleets into grid batteries.

The utility POV: Vehicle-to-grid (V2G) charging is one of the biggest draws for mass EV deployment. EVs can act as batteries, storing energy during off-peak hours to use during peak. School buses are ideal—they operate for only a few hours per day, which leaves ample time to plug in for off-peak electricity in the middle of the day.

By the numbers: 

• California’s 25,000 school buses could provide more than 1 GW of electricity if converted to battery power, according to the California Energy Commission.

• This could ease almost 5% of the California Independent System Operator’s current peak demand—if not more.

Looking ahead: Electric school-bus V2G projects are popping up in other states as well. Transportation startup Highland Electric Fleets launched the country’s first electric school bus fleet in Montgomery County, Maryland, in 2021. And EV company Nuvve is also deploying V2G projects in Colorado and Illinois.

American Energy Poverty: Still an Issue

Utilities including Tampa Electric, DTE Energy, Xcel Energy, and Dominion Energy have been raising rates by over 10% in recent months due to a confluence of factors:

• Rising oil and gas prices

• Increasing demand

• High costs to maintain and rebuild aging or stressed grid infrastructure

• Increasing costs of extreme weather impacts

Yes, but: Many energy professionals suggest the motive behind these hikes might actually be an aging utility business model that incentivizes big capital investments customers have to pay off.

The customer POV: 5.2 million households that live above the poverty line experience “energy poverty,” or the inability to afford utilities to properly heat or cool their home, according to a 2022 study. Electricity costs have risen by 28.5% since 2019, and the average American is now paying almost $300 a month in utility bills.

“Sometimes I have to choose whether I'm going to pay the light bill or do I pay all the rent or buy food or not let my son do a sport,” one customer told CBS.

The EC Wire

• Another turbine blade solution emerges to prevent waste from ending up in landfills.

• Massachusetts cities embrace a new emission-slashing building code.

• A new Google tool will help cities manage heat waves.

• The UK boosts offshore wind with more capacity.

• US wind energy investment surpasses solar.