Southern Finance Quick Review: The Motivation and Clarification of Large-Scale Power Outages in Texas, USA.

Original title: Nancai Express: Motivation and Illustration of the Large-Scale Blackout in Texas

In recent days, many states in the United States have been hit by winter storms for many days in a row. Among them, Texas, located in the southern United States, was the most devastated. On the night of February 14, there was the lowest temperature in nearly 30 years. Extreme weather has caused oil wells to freeze and natural gas power generation to slow; turbines freeze and wind power generation is reduced; At the same time, the demand for energy has increased dramatically, causing the supply not to cover the demand, forcing the entire Texas grid to implementshort termRotating power outages – Under extreme supply and demand imbalance, the price of electricity in Texas skyrocketed once it hit 10,000American dollar/ MWh, equivalent to 200 times the usual price of local electricity.

TexasPower industrymarketThe reform began in 1995 and was opened successivelyWholesale market、Spot market, The retail market on the electricity side, and the node market replaces itRegional market, Theoretically improve market efficiency.

However, in addition to physical reasons such as unit freezing caused by extreme weather conditions, the large-scale power outage has certain market reasons. On the one hand, due to the cyclical market, the peak of energy consumption in Texas is usually summer, and February is the time when most gas generators in Texas are shut down for maintenance or shutdown, even if the system operator Local power requires it to turn on gas generators for electricity supply, it also faces operational risks from “cold start” and neglect of maintenance. On the other hand, as the temperature plummeted, natural gaspriceIt is also tall, leading tobusinessEnergy generationcostWhen it rises, the willingness to generate electricity falls.Of course, there are also opinions that it is precisely becauseMarket reformThe extremely high price of the electricity generated makes the most of scarce resources, curbs additional demand for electricity by business users and prevents the gap between electricity supply and demand from increasing further.

The top priority for Texas power system operators is to find a way to allow gas units to generate electricity normally in such extreme cold weather, and to improve early warning capabilities so that surge reduction generators can be prepared for power generation in advance to secure the marketsupplyBesides, you need to adjustMarket Mechanism, Through considerable economic benefitsexcitementEnergy generationthe companyMore peak reduction generator sets will be added and repaired to cope with the most extreme weather conditions caused by future climate change. In the future, system operators must also be careful about the development of renewable energy and large-scale storage batteries to avoid similar large-scale downtime due to climatic reasons.

　　This historic storm reminds people of diverse fuel supplies, high-quality transmission infrastructure, and reliable grid operators and electricity.supplierEffective coordination between them is essential.

Obviously, European and American energy systems are very market oriented, which means that energy companiesprofitMaximization comes firstobjectivesTherefore, the energy supply is strongly price-driven, which increases public risks to some extent. So if a region of China encounters a similar cold snap, how will it respond? China’s energy system is fundamentally different from traditional developed countries like Europe and the United States: China stillEnergy industryDuring the market-oriented reform process, most power generation companiesState-owned enterprise, Its operating philosophy is to maximize profits under the premise of maintaining public safety.Therefore, once a similar incident occurs, the grid company can force the deployment of energy resources in the disaster area to protect the people’s lives andpropertySafety.

Therefore, in the upcoming reform of China’s electricity market, lessons should be learned, not only to achieve high efficiency, but also to ensure public safety: improve efficiency through market reforms, and at the same time, strengthen supervision to ensure production order and life under extreme conditions. It is necessary to seek green development, but also to take advantage of the advantages of traditional energy: while vigorously developing new energy, avoid blindly eliminating the capacity of coal power units. Coal power units are still necessary to maintain grid stability before finding a solution to completely replace coal power units Not only technological innovation but alsomechanismInnovation: On the one hand, the development of new technologies such as large-scale energy storage, carbon capture and storage is the futureEnergy industryLow-cost, green and safe development brings confidence; on the other hand, we must study theIncentives, Make the market-oriented reform of China’s energy industry more effective.

(Source: 21st Century Business Herald)

(Responsible editor: DF398)