ECRS: Analysis of 2023 ERCOT Market Price Impacts
New Aurora report finds weather and thermal plant outages, rather than ancillary services, drove high wholesale power prices in ERCOT during 2023 peak Texas heat
Our latest report on ‘ECRS: Analysis of 2023 ERCOT Market Price Impacts’ shows the Texas power market’s ten most expensive days in 2023, finding that prices to consumers remained flat and below the U.S. average and that wholesale energy price spikes were primarily driven by weather and thermal outages, not ancillary services as previously argued by the Independent Market Monitor (IMM). Access the full report now.
To assess the impact of these conditions on system costs, Aurora analyzed ten days in Summer 2023 where low reserve margins resulted in high system prices and simulated the impact of lower thermal outages, load, and ECRS procurement on energy prices. Across these ten days alone, day-ahead and real-time market energy costs reached an estimated total of $10.6 billion.
Among these high-cost days, Aurora’s simulation found the following:
1. Had system-wide load been consistent with ERCOT’s peak forecast of 82.7 GW, total energy costs in these ten days would have been $8.3 billion lower.
2. Had unplanned thermal outages been at ERCOT’s baseline, total energy costs in these ten days would have been $5.4 billion lower
3. Releasing 75% of ECRS volumes would have reduced costs by $4.6 billion across ten days, but controlling for load or thermal outages drops these excess costs to between $100 million and $1.3 billion.
These findings demonstrate that the impacts of high load and thermal outages outweighed ECRS as the driver of scarcity during the summer of 2023.
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