In a September 2024 special edition of Fiscal Notes, Texas Comptroller researchers Jess Donald and Spencer Grubbs explore the pressing issue of balancing energy demand and grid reliability in the face of the state’s rapid population and economic growth. Texas, which now houses over 30 million residents, set six new daily power consumption records in May 2024 alone. The Electric Reliability Council of Texas (ERCOT) projects continued increases, driven by population expansion, extreme weather, electric vehicles, and power-hungry technologies like artificial intelligence (AI) and cryptocurrency mining.
ERCOT is at the forefront of forecasting demand to ensure the Texas electric grid remains reliable. “Texas is the world’s eighth-largest economy. That level of economic output requires reliable energy to support the businesses and residents calling our state home,” Texas Comptroller Glenn Hegar said.
The challenges of balancing demand have become increasingly complex. ERCOT’s forecasting includes three main categories—short-term, medium-term, and long-term projections—to adapt to changing weather patterns, real-time data, and economic indicators. Factors such as Texas’ growing population, projected to reach 150 GW peak demand by 2030, make accurate load forecasting essential to maintaining grid stability.
Spikes in demand are also influenced by the rise of electric vehicles, data centers, and AI applications. Data centers, particularly those supporting AI, are energy-intensive, and AI-driven searches use 10 to 30 times more power than traditional searches. Cryptocurrency mining, especially with facilities like Riot Platforms’ 700 MW capacity in Rockdale, has similarly contributed to the strain on Texas’ grid. Riot and other miners leverage flexible load capabilities, shutting down operations during peak demand to sell unused power back to the grid, helping to stabilize supply.
In response to growing energy needs, Texas lawmakers passed House Bill 5066 during the 88th Texas Legislature, allowing ERCOT to account for potential users in resource planning. This legislation, alongside ERCOT’s strategic planning and technological innovation, aims to prepare the grid for future challenges and ensure it can meet the demands of Texas’ thriving economy.
The ongoing expansion in energy demand underscores the need for a diversified energy portfolio, and with ERCOT’s efforts, Texas remains focused on creating a reliable and sustainable grid.
Texas Reporter 