Our kids went back to school this week in Calgary. The oldest heads to grade 2, the middle one started kindergarten (she could not be more excited) and the youngest is in daycare. It’s a big change: three drop offs, and a new morning pattern of packed lunches, missing shoes and three kids moving toward the door at once.
Power markets are adjusting too. Megawatt-hours still matter, but their value increasingly depends on shape: hour, season and location.
Start with the day. Over the past twelve months, Texas hub power averaged $34/MWh at 8 am, fell to $18 at 11 am and climbed to $57 by 8 pm. Two peaks now, and the cheapest hours have moved from the middle of the night to midday. Power at 4 am clears $28, more than half again the $18 midday low. That is what happens when utility-scale solar generation grows sixfold in five years.
The calendar shape is also changing. Heating electrification is pushing parts of the Northeast toward winter peaks, and the crossover starts now, not in the distant future. NYISO’s North zone is already winter-peaking. Maine follows in 2028 and AEP in 2032. And winter has no midday solar surplus to lean on.
Patterns are shifting across geography. In 2023, West Texas solar captured 71% of its local average price while the rest of ERCOT sat near par. This year capture has fallen to 56% in North Texas and 59% in Houston. The panels spread east, and the cannibalization followed them. Building somewhere else is no longer much of a strategy.
Storage has been both victim and beneficiary. In March, Battery Brawl showed average ERCOT battery revenue collapsing from $149/kW in 2023 to under $20/kW in 2025. What remains rewards trading and dispatch. Batteries now set the marginal price 23% of the time, at an average $56/MWh against $35 when combined-cycle gas is marginal.
New dispatchable capacity faces the other side of the same problem. ERCOT does not have a capacity market, so a plant recovers its costs from energy and ancillary services. Construction runs $2,000 to $3,000/kW, and our work puts the PPA floor for a $2,500/kW combined cycle near $70/MWh, against hub power averaging roughly $32. That floor assumes the plant runs 75% of the time, which is exactly what a shifting curve takes away. A peaker can pick its hours, but it has far fewer of them to spread the same cost over. Of about 60 GW of ERCOT gas in development, only 6 GW clears our readiness screen, and none of it gets built without a contract.
Shape, not volume, is now the main variable in power asset value. And the shape underwritten three years ago is already gone.
Thoughts, questions or things we missed? Send me a note (or hit reply) - I would love to hear from you. Thanks for reading!
Morning Energy is a syndicated note published through Enverus Intelligence. My contributions will also be distributed here. Please note that links frequently lead to content available only to subscribers of Enverus solutions. Please reach out if you have any questions. Thanks! - Ian.