ERCOT says it’ll be another summer of high electricity use! Can you afford not to shop lower fixed rates?

Ready for Summer? ERCOT says it’ll be another summer of high electricity use! Can you afford not to shop lower fixed rates?

ERCOT Reserve Margin 2020 News

ERCOT released its final Seasonal Assessment of Resource Adequacy (SARA) prediction on Thursday, March 5 for Spring 2020 (March – May) and also its preliminary Summer (June – September) assessment.

ERCOT anticipates having enough electricity capacity to meet the forecast 64,233 MW spring peak load. However, this summer looks like Texans will use a record amount of  electricity. And that indicates there’s a potential for dizzying electricity rate spikes.

ERCOT Reserve Margin Electricity

ERCOT’s initial prediction for this summer’s forecast is for a peak load of 76,696 MW. Back in December, 2019, ERCOT announced its 2020 planning reserve margin  to be 10.6%. That then included new summer capacity coming from 88 MW of natural gas, 77 MW from solar, and 348 MW from wind.

Since then, the total resource capacity has increased slightly to 82,417 MW. The good news is that ERCOT is planning to have 2% more generation source in reserve than last year. The problem is that there’s still 1.3% or 1071,4 MW of generation resources that ERCOT is still seeking.

All the same, this year’s reserve margin remains well below the 13.8% reference margin recommended by the North American Electric Reliability Corporation (NERC). ERCOT is the only grid in North America where the reserve margin doesn’t meet or exceed the NERC reference margin.

ERCOT Electricity Pricing

In the March 5 announcement, ERCOT President and CEO Bill Magness states “We expect grid operations to be very similar to last summer.”

Now, many Texas electricity customers  are probably shuddering to hear that. Last August and September saw high heat, high demand, and faltering wind capacity that caused energy emergencies and tight market conditions. These drove late 2019 summer wholesale prices all the way up to $9000. Residential rates jumped to above $7 per kWh. Horror stories circulated in the media about consumer electric bills that spiraled up into hundreds of dollars for just a few day’s electricity usage.

But you can avoid the risk of getting burned by sky-high prices if you take action soon.


Currently, natural gas prices are staying submerged below $2.00/mmBTU. Because of the mild winter and high production rates, there is a record amount of natural gas available. Because natural gas is burned to spin up most of the electricity generators in Texas, electricity prices in the Lone Star State are likely to fall. That’s even more likely to happen during April when seasonal conditions are too warm for home owners to need heat but too cool enough to need air conditioning. This kind of low demand affects Texas electricity prices twice a year in what’s known as “shoulder month” pricing. Customers who shop plans during the shoulder months can usually save money.

While it’s likely that natural gas supply may stay comparatively high through the end of the year, late summer electricity demand in Texas will eat up much of that glut. The EIA predicts “that prices will rise in the second quarter of 2020, as U.S. natural gas production declines and natural gas use for power generation increases the demand for gas.”

Yes, Texas electricity prices will probably go up if the hot late summer temperatures come as forecast. If you’re in month-to-month plan or signed up with a wholesale electricity service supplier, you need to get into a fixed rate plan with in the next few weeks. That’s because fixed rate electricity plans let you lock in a low rate for the length of the contract. When other folks are paying fistfuls of dollars per kWh, you’ll pay the same low price per kWh. And that could save you hundreds!

Cheapest Electricity Prices In ERCOT

The easiest place to shop for the best electricity rate in Texas is at Customers can compare plans, read plan reviews, and shop for the best rate. They can also read customer reviews of retail electricity providers to find the one that works best for them. Plus, there’s also tools, tips, and information that help you find the best plan and save money.

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