Capacity Factors - Texas Wind & Natural Gas

How do capacity factors compare in Texas between wind and natural gas

Capacity Factors - Texas Wind & Natural Gas
Photo by Rabih Shasha / Unsplash
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"Capacity factors measure how intensively a generating unit runs. EIA calculates capacity factors by dividing the actual electrical energy produced by a generating unit by the maximum possible electrical energy that could have been produced if the generator operated at continuous full power. A capacity factor of 100% means a generating unit is operating all of the time." - EIA

Wind & solar power is intermittent. The sun doesn't shine and the wind doesn't blow all the time. Therefore, wind and solar plants have low capacity factors.

Nationwide, wind capacity factors are around 33%, while solar is even lower at 20%. Until battery storage technology can scale at an affordable price to offset wind and solar generation peaks and valleys, the idea of a true green energy transition seems unlikely.

But do low capacity factors alone suggest the wind and solar capacity build-outs should not take place?

Capacity Factors:  Wind vs Natural Gas

We took a look at Texas natural gas capacity factors versus wind for some context and to calibrate what low capacity factors looks like.

The data may surprised you.

Methodology:  

We calculated monthly wind and natural gas capacity using the EIA 860 datasets, accounting for operating and retired plants.

Monthly capacity (MWhrs)  = aggregate MW capacity x 30 days x 24 hours

Monthly generation in MWhrs / monthly capacity = capacity factor

Natural gas generation in Texas never really caught up to the capacity build-out in the early-2000s and has mostly flatlined the last two decades with modest growth, creating a large gap between capacity and monthly generation.  We should note, there has been peak hourly demand at times in recent years when 80% +/- of this gas capacity was utilized.

Wind generation in Texas has had a closer correlation to capacity growth, with a vastly different generation growth curve in recent years.  A wide gap between wind capacity and generation remains, as one would expect.

One of the arguments against intermittent power is that it needs a build-out of peaking capacity alongside it for standby power when its not sunny or windy.  That hasn't been the case in Texas, where the natural gas build-out was over before the wind build-out began.

Looking at capacity factors together, it may be surprising, but aggregate wind plants in Texas currently have a higher capacity factor (35.7%) than aggregate natural gas plants (35.3%).  

Weather and climate are the biggest drives of wind capacity factors.  Demand spikes, natural gas prices, heat rates and economics are driving gas plant capacity factors.  Natural gas is often used for peaking and is there for standby power for when demand is high or when coal, wind, or solar can't perform.

In Texas, wind and natural gas power plants are utilized very similarly. Interestingly, natural gas capacity factors have gone up as more wind was built in the state, which is counterintuitive.  Coal-to-gas switching is likely the driver.


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