When we talk about electrical power generation, you may have heard some people refer to the term “base load.” Put simply, base load is an energy demand that must be maintained in order to satisfy electrical demand. There are times during hot or cold weather when more electricity is needed. However, this increase is not constant. Think about hot summer afternoons when your parents turn the AC up to keep the house cool. At night when the sun goes down you’re able to turn the AC down, turn the lights off, and as a result you’re consuming less electricity. But there is a minimum amount of energy that must continually be provided in the form of base load. How do the various forms of primary energy used to generate electricity compare when we consider them for supplying that base load?
- Wind farms: can supply energy only as long as the wind is blowing
- Solar farms: can supply energy only when the sun is shining
- Natural gas powered plants: can supply energy at any scale and at any time of the day, very quick to start up (one-several hours) when needed
- Nuclear plants: can supply energy on a large scale at any time of day, takes about 12 hours to start up
- Coal fired plants: can supply energy on a large scale at any time of day, no longer cost effective against natural gas
Ensuring we have enough energy that can then be converted into electricity at the power plant no matter what time of day is the process of satisfying base load. When changes occur in base load needed, start-up time is crucial. The time it takes a power plant to reach full operations can affect the reliability and operations of the electric grid.
Below, you can see a chart from the U.S. Energy Information administration that gives you an idea of how quickly various power plants can reach full load. Some power plants, especially those with steam turbines powered by coal and nuclear fuel, require more than half a day to reach full operations. Steam turbines require time. A fuel heats up water to form steam, and that steam needs to reach certain temperature, pressure, and moisture content thresholds before it can be directed to a turbine that can spin the electricity generator.1U.S. Energy Information Administration. (n.d.). U.S. Energy Information Administration independent statistics and analysis. About 25% of U.S. power plants can start up within an hour. Today in Energy. U.S. Energy Information Administration (EIA). Retrieved October 4, 2021, from https://www.eia.gov/todayinenergy/detail.php?id=45956.
A number of utility-scale solar and wind power plants have been added in recent years. These are not included in the graphic below because start-up time is not relevant for these types of plants.
In the next graph, you can see that about 25% of U.S. power plants can start up—going from being shut down to fully operating—within one hour.2U.S. Energy Information Administration. (n.d.). U.S. Energy Information Administration independent statistics and analysis. About 25% of U.S. power plants can start up within an hour. Today in Energy. U.S. Energy Information Administration (EIA). Retrieved October 4, 2021, from https://www.eia.gov/todayinenergy/detail.php?id=45956.
A Very Hot Day in Texas
To better understand the concept of base load and the various energy sources that contribute to electricity availability, let’s look at an example of power generation in Texas on a very hot August day. Given that the Electric Reliability Council of Texas (ERCOT) operates the power grid for most of the state, we can assume that electricity is solely generated and consumed within state lines for this example.
Power generation from various primary energy sources measured in GW plotted against hours of the day. Note that time on the x axis is given in 24-hr increments.
Given temperatures are at their peak on summer afternoons (beginning at the 11 hour mark), what electricity source was able to ramp up the fastest to keep up with demand?
An increase in power demand is satisfied by natural gas for a large portion of the day.
Who Pays For This?
In Texas, there are many public utility operators that are responsible for delivering the electricity to our homes from the state’s ERCOT-operated electrical grid. Ratepayers, then pay a pre- or post-determined rate for their electricity consumption. According to the Energy Information Administration (EIA), “the cost to supply electricity changes minute by minute. However, most consumers pay rates based on the seasonal cost of electricity. Changes in prices generally reflect variations in electricity demand, availability of generation sources, fuel costs, and power plant availability. Prices are usually highest in the summer when total demand is high because more expensive generation sources are added to meet the increased demand.”3U.S. Energy Information Administration. (n.d.). U.S. Energy Information Administration independent statistics and analysis. Prices and factors affecting prices. U.S. Energy Information Administration (EIA). Retrieved October 4, 2021, from https://www.eia.gov/energyexplained/electricity/prices-and-factors-affecting-prices.php.
Let’s take the example of natural gas ramping up to supply enough electricity on that hot summer day in Texas. In this case peaking power plants, power plants that generally run only when there is a high demand, have been brought online to satisfy demand. Recall that natural gas power plants can come online quickly. Given immediate supply is required to add extra power to the grid, a wholesale spot price goes into effect, meaning the cost of electricity during that time of day is much higher than the general cost as shown in the chart below. By definition a spot price is “the current price in the marketplace at which a given asset—such as a security, commodity, or currency—can be bought or sold for immediate delivery.”4Chen, J. (2021, May 19). Spot price definition. Investopedia. Retrieved October 4, 2021, from https://www.investopedia.com/terms/s/spotprice.asp. As you can see from the graph, spot prices can ramp up very quickly and in turn result in very costly electricity bills for ratepayers. One way to avoid the high spot prices is to opt into a fixed rate, where the rate charge for electricity remains at a constant price regardless of price spikes in the spot price.
As demand increases, the wholesale spot price jumps significantly in the afternoon on this hot Texas summer day.
Before concluding this lesson, let’s ponder an important question before beginning the next lesson: How might we satisfy our demand for electricity while working to reduce fossil fuels? As we can see on a hot summer day, natural gas was able to satisfy the increased demand; however, what other sources do you think we could look to in the future? The decisions we make today are important, and it seems inevitable that we will face significant trade offs when addressing the impact of fossil fuels on the environment while at the same time satisfying increasing electricity demand. The next lesson, Filling the Power Gap, allows you to analyze how we might satisfy demand with the different technologies we have today and how our future power grid may impact the climate.
Career Spotlight: Dr. Paul Bommer
- B.S., Petroleum Engineering, The University of Texas at Austin
- M.S., Petroleum Engineering, The University of Texas at Austin
- Ph.D., Petroleum Engineering, The University of Texas at Austin
The expert behind the Business Case for Oil and Gas, Dr. Paul Bommer, is a distinguished senior lecturer in the Hildebrand Department of Petroleum and Geosystems Engineering at The University of Texas at Austin. Dr. Bommer teaches a number of courses related to petroleum engineering and his primary research interests focus on drilling and completions as well as production engineering. He has decades of industry experience that give him a unique perspective on the economics of oil and gas. Dr. Bommer has been awarded numerous teaching and research awards including from the Cockrell School of Engineering, Connoco-Phillips, and several other organizations. Additionally, in 2010, Paul Bommer served on several different committees as a drilling engineer expert to investigate the causes of the Deepwater Horizon Blowout for both the federal government and the National Academy of Engineering.
- image-3: ERCOT
- image-4: ERCOT
- image-5: ERCOT
- image-3: Hildebrand Department of Petroleum and Geosystems Engineering
- image: Hilary Olson