ERCOT Releases Capacity, Demand and Reserves (CDR) Report; Planning Reserves Pressured as Texas Economy Grows

ERCOT Working with Policymakers and Stakeholders to Address Short- and Long-term Solutions

(Austin, TX) Electric Reliability Council of Texas, Inc. (ERCOT) today released the 2025-2029 Capacity, Demand and Reserves (CDR) report. The main purpose of the report is to provide potential future planning reserve margins (resource adequacy) expected to be available on the grid when demand is highest during the summer and winter seasons (June through September and December through February, respectively).

The CDR report is a snapshot of potential supply resource availability and demand over the next five years. It is not intended to represent expected real-time operations scenarios. The 2025-2029 CDR report also includes varying load and supply resource scenarios that illustrate alternative planning reserve margin outcomes over the five-year horizon.

“In 2023, the Legislature passed House Bill 5066, which changed our load forecasting processes. The HB 5066 load forecast comes directly from the transmission and distribution utilities that are talking with customers,” said ERCOT President and CEO Pablo Vegas. “The load forecast supports the transmission needs ERCOT addressed in the 2024 Regional Transmission Plan (RTP) report released December 20, 2024, that considers continued build-out of the ERCOT transmission system at 345-kV or a new combined 345-kV and 765-kV level.”

This new load was originally included in the May 2024 CDR report as a forecast scenario. Now, ERCOT is using it as the primary load forecast in resource adequacy and transmission planning. This forecast is driven by continued strong economic and population growth in Texas, as well as growth by large consumers such as data centers, industrial oil and gas production facilities, and cryptocurrency mining operations.

Factors Impacting Planning Reserve Margins
The 2025-2029 CDR differs from previous CDR reporting years due to a variety of report parameter changes. These include:

• Using the new load forecast noted previously,
• Using Effective Load Carrying Capabilities (ELCCs) to measure the reliability contributions of wind, solar, and battery energy storage, and
• Illustrating both peak and peak net reserve margins, including demand-side resources such as demand response programs.

More explanation of each of these changes is included in the full report. Additionally, the majority of Texas Energy Fund (TEF) generation (9,720 MW) did not meet the rules for inclusion in the base CDR scenario; however, additional scenarios did include the full TEF generation portfolio to show their potential impact on reserve margins.

“For this CDR, we provided additional scenarios to illustrate the impacts of timing differences in load and supply growth. For example, if load were to not materialize as early as forecasted or if the full TEF generation portfolio is built within the report horizon,” said ERCOT CEO Pablo Vegas. “These are probable scenarios that show moderated planning reserve impacts. However, the economic growth ahead does show that action is needed today to ensure long-term reliability and affordability.”

The new parameters and scenarios in the CDR better represent the performance of grid resources and the dynamic nature of the ERCOT grid. But it’s important to note that all scenarios in this report have a certain level of uncertainty that can alter the long-term resource adequacy outcomes, and these forecasts will change over time based on a variety of factors (i.e., state and federal policy changes, economic developments, market design initiatives, evolving grid management practices, and technology improvements).

The economic growth ahead provides opportunities over the short- and long-term to improve planning reserve margins.
Potential short-term solutions include expanding demand response capabilities with a focus on residential customers, broadening the scope of the Firm Fuel Supply Service program, and continuing to support the TEF generation projects in the interconnection process. Additionally, there are opportunities to further enhance battery optimization and to work with large loads, like data centers, on flexibility capabilities.

“ERCOT looks forward to working on short- and long-term solutions with the Texas Legislature, PUCT, and stakeholders to continue to strengthen the reliability and resiliency of the Texas power grid,” Vegas concluded.

###