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CenterPoint Energy projects the Houston metro may need 50% more electricity at peak times by 2031.
To put that into perspective, that would be like adding two San Antonio metros to the Houston region.
The projection is still more on the conservative side. CenterPoint CEO Jason Wells told company officials during a meeting last week that the region’s actual electricity needs might end up being much higher. The Electric Reliability Council of Texas has forecasted that peak power demand on its system could increase 70% by 2031.
Ed Hirs, Energy Fellow at the University of Houston, said the projection is possible, but still cloudy because of the volatility on policy coming out of Washington.
"It depends upon a growing economy nationally and reinvestment in the Houston economy, both of which could have some challenges with the tariffs," he said.
Billions of dollars of investments would be needed to keep the local power grid in good shape and to accommodate the massive growth. CenterPoint earned $297 million in profits in the first quarter, down 15% from the same period last year.
A significant opportunity is now possible for CenterPoint to go big on another capital project. The cost of such projects would likely be paid for through electricity rate increases on CenterPoint’s customers.
"We're not going to be building big generator plants in the city limits of Houston, but it's possible that we'll build a few on the outskirts," said Hirs. "CenterPoint is going to have to accommodate the growth, generation and transmission coming into the area."
Plenty of new data centers and cryptocurrency mines are expected to be built in rural areas of Texas where land is cheaper. These data centers and mines will require a lot of energy.
"A lot of these projections are dependent on growth in data centers and we don't know how many of these are actually going to be built," Hirs added. "I'm sure owners of these data centers are going to build wherever they can and as fast as they can."
According to CenterPoint’s conservative forecast, the Houston metro’s peak demand for electricity could increase 10 gigawatts by the end of 2031. One gigawatt can power around 250,000 Texas homes during peak demand periods.
Hirs is most concerned about the Texas Legislature "not looking ahead." He said the current bills before lawmakers "do not solve the basic problems of the ERCOT grid."