Texas Moves To Link Its Power Grid To Other States After Heavy Property Losses 3 Years Ago
Texas is taking steps toward expanding its famously self-contained power grid in what is likely to be welcome news to a state that suffered tens of billions of dollars in property damage due to a grid failure three years ago.
The $2.6B plan calls for a 400-mile transmission line through Louisiana and into Mississippi that would connect the Electric Reliability Council of Texas grid to the southeastern U.S., The Dallas Morning News reports.
The line, called Southern Spirit Transmission, is a Pattern Energy project that would allow energy to flow into or out of Texas depending on need.
The project wouldn't require federal regulation because of the way it is structured, the DMN reported. Garland, Texas, which would operate a substation on the Texas border, announced its participation in the project in 2011. Its progress hadn't been closely monitored, however, until Pattern Energy held a community meeting on the project in northwest Louisiana last year.
Although construction isn't projected to start until 2026, the slowly solidifying plans come almost three years after Winter Storm Uri, during which the state’s grid failed, contributing to hundreds of deaths and $80B to $130B in losses and damages.
CRE has closely monitored Texas’ power grid in the years since, especially as insurance and energy costs have risen. By March 2022, the Texas Department of Insurance had tallied 510,772 freeze-related insurance claims, noting an expected payout total of $11.2B. The average incurred loss for residential property hovered near $17,600. For commercial property, it was about $149K.
Multifamily properties were hit especially hard. Camden Property Trust CEO Ric Campo previously told Bisnow that Camden saw around $20M worth of water damage across its 53 properties. This contributed to the $4M increase in property insurance the company saw between 2020 and 2021, Campo said.
While the Southern Spirit Transmission line would be enough to power a few hundred thousand homes, according to the DMN, it wouldn’t come close to propping up the grid in another Uri-type situation. During the February 2021 storm, more than 4.5 million businesses and homes lost power.
“It could help. I don’t think it would have helped in ’21 because those states had similar temperatures and similar weather, and they didn’t have any excess power,” Grayson-Collin Electric Cooperative CEO David McGinnis told Sherman, Texas-based television station KXII.
Pattern Energy said that once the project comes online, its total import capacity would still be less than 4% of ERCOT’s current peak resource needs, the DMN reported. But while Texas has several small direct-current connections with Mexico and the western and eastern U.S. grids, Southern Spirit Transmission would be the biggest one yet, according to the DMN.
The project awaits approval in Louisiana and Mississippi.
