Experts break down Texas ERCOT’s future: power and prices

WICHITA FALLS, Texas (KAUZ) - Five Energy Advisory Services experts took a deep dive into the future of the Texas power grid on Tuesday, weighing in on market risks, energy prices and how long ERCOT’s run might last.

Three representatives leading today’s webinar walked through ERCOT’s summer performance, spotlighted recent changes and offered a reality check on the challenges ahead.

“What we want to do here is sort of explore what’s going on. How long will these somewhat good times last,” Five Energy Advisory Services President and CEO Brian Hayduk said.

Kicking things off, the panel took a closer look at the Texas power grid.

Five energy advisory experts noted that natural gas, wind, and solar remain the state’s top three energy sources. From there, they walked through the history of power generation in Texas, breaking it down year by year, all the way back to 1999.

With that supply-side picture in place, the focus then shifted to demand.

“This is ERCOT’s Load Forecast Inclusive of TDSP Large Editions so, what that means is that if a large load wants to come and connect to the grid, the first place they start is with your TDSP provider,” Five Energy Advisory Services Senior Market Analyst & Zoltar Abby Grasshoff said.

Looking at the numbers, experts estimate that over the next six years, Texas’ power grid could see an increase of roughly 94 to 218 gigawatts.

A big driver behind that growth: more AI data centers setting up shop across the state.

For everyday Texans, that could mean added pressure on local utilities like Oncor, which serves Wichita Falls homes, potentially affecting both reliability and monthly bills.

And while the impact on market prices has been closely watched, it’s during the summer months where the biggest swings have shown up in recent years.

“Back in 2022, right after Russia invaded Ukraine, natural gas prices were sky-high, about $789 across the summer, with prices heading in around $145. Fast forward to 2023, and it was a completely different story. Natural gas was much cheaper, and by May, wholesale prices were sitting near $51. Over the last four years, those have been the high and low points for wholesale electricity going into summer. The following year, prices climbed again, trading as high as $110 before settling around $92 by May. This year, after a fairly mild summer in 2024, prices were a little softer, just under $100 early in the season, and closer to $74 by the end of May,” FEAS Chief Risk Officer Eric Bratcher said.

One upside representatives noted, is that most of the new load isn’t expected until 2026 to 2028 meaning the Texas grid could see a bit of calm over the next one or two summers.