Nov. 17—AUSTIN ERCOT has canceled the procurement from the Request for Proposal (RFP) seeking additional capacity due to the limited response from the market, which included only a small 11.1 MW of potentially eligible capacity, a Friday news release said.

"The request for additional capacity was an extra layer of precaution to mitigate higher risk during extreme weather this winter," said ERCOT President and CEO Pablo Vegas in the release. "ERCOT is not projecting emergency conditions this winter and expects to have adequate resources to meet demand."

ERCOT has implemented many reforms and grid improvements since 2021, including weatherization inspections of electric generation units and transmission facilities, additional ancillary services, and firm fuel supply service.

Additionally, regardless of the market response today, ERCOT firmly believes that there remains tremendous potential in expanding demand response capabilities throughout the industrial, commercial, and residential customer classes, and looks forward to working with the Public Utility Commission of Texas (PUCT) and stakeholders to explore what incentives and product designs may work better in the future. Reducing peak demand at critical times can be an effective tool in an overall portfolio of reliability solutions, the release said.

Additional Information on the RFP

The RFP was based on probabilistic analysis indicating that if the ERCOT Region experienced a storm during the 2023-2024 winter Peak Load Season comparable to last year's Winter Storm Elliott, there would be a 20% risk of ERCOT entering Energy Emergency Alert (EEA) conditions. To reduce this elevated risk, ERCOT sought to procure up to 3,000 MW of additional capacity that could be called upon if needed as an added layer of protection during peak times.

In declining to proceed with the RFP, ERCOT weighed factors such as the costs of the program, including costs of administration, and the incremental additional complexity for the Control Room operators against the very small amount of capacity that could be provided and the associated minimal reliability benefits.

"One of the important outcomes of this RFP process was learning what the market response would be to this type of capacity request," said Vegas. "We'll take these lessons and continue to work with the PUCT and the market to evaluate other types of demand response products that could contribute meaningfully to electric reliability in the future. In the interim, ERCOT will continue to advance its winter preparedness through the many reliability programs and tools we have available."