Austin, TX (AURORA ENERGY RESEARCH)—A new report from Aurora Energy Research finds that Texas can meet its rapidly growing electricity demand while lowering costs and improving grid reliability through expanded energy efficiency and demand response programs. Commissioned by the Texas Association of Business in partnership with the South-central Partnership for Energy Efficiency as a Resource (SPEER), the study offers insights on different approaches to demand side management to strengthen the ERCOT grid amid unprecedented demand growth.
Aurora’s analysis shows that widespread adoption of heat pumps could lower consumer electricity prices by up to 45%, with the average household saving $424 annually by switching from electric resistance heating. Demand response programs also offer significant savings: on average, they may reduce average electricity prices by $3 per megawatt-hour, translating to annual savings of up to $1.9 million for an industrial consumer and $225 for a residential user.
Texas is experiencing some of the fastest load growth in the nation, driven by population increases, expanding industrial and oil & gas activity, and surging demand from data centers and cryptocurrency mining. Aurora projects that data centers alone will add at least 8 GW of new load to the Texas grid by 2035.
Demand response programs, which relieve pressure on the grid during periods of peak demand, show particularly strong potential. In a modeled winter storm scenario, participation from just 20% of residential and commercial users (3.5 GW) and 10% of industrial datacenters (0.7 GW) could reduce load shed by 47 GWh (-70%), translating to $1.7 billion in prevented costs. If half of industrial datacenters participated, outages could be eliminated entirely, even in extreme weather conditions.
The report highlights that technologies like heat pumps not only reduce household costs but also ease grid stress during critical periods. Their widespread adoption would provide a dual benefit: improved system reliability and lower consumer energy bills.
Taken together, expanded demand response efforts and the transition to energy-efficient technologies offer Texas a powerful, cost-effective strategy to manage surging electricity demand.
Olivier Beaufils, Head of USA Central at Aurora Energy Research, commented:
“Texas’s economic momentum is driving a sharp rise in electricity demand, creating both a challenge and an opportunity. Energy efficiency and demand response programs provide critical additional levers for Texas to keep pace with the demand while cutting costs for consumers and strengthening the reliability of the grid.”
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Media Contact:
Sarah Hrovat, Media Relations Specialist, NORAM
sarah.hrovat@auroraer.com
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Established in 2013, Aurora Energy Research is a leading global provider of power market forecasting and analytics for critical investment and financing decisions. Headquartered in Oxford, England, we operate out of 16 offices worldwide covering Europe, North & South America, Asia, and Australia.
Our comprehensive services include market outlook packages for energy industry participants, advisory support, and innovative software solutions. We foster diversity with a team of close to 1000 experts with backgrounds in energy, finance, and consulting, offering unparalleled expertise across power, renewables, storage, hydrogen, carbon, and fossil commodities. Our mission is to facilitate the global energy transition through widely trusted quantitative analysis and high-quality decision support.
