HOUSTON, May 1 (Reuters) - Texas will again face the prospect of rolling blackouts and more frequent calls for conservation on the hottest days this summer as projected demand grows faster than generation is being built to serve those needs, the state's independent grid operator warned in a report.
The Electric Reliability Council of Texas (ERCOT), which oversees the grid for most of the state, said power reserves - the minimum capacity needed to cushion against extreme weather or unplanned outages - will fall to about 9 percent this summer, well below the agency's minimum target of 13.75 percent to avoid blackout risk.
A lack of new power plant construction and two extremely hot summers strained power supplies in 2010 and 2011, adding urgency to an ongoing discussion among regulators on ways to encourage new generation to serve the state's $35 billion deregulated market.
(Reporting by Eileen O'Grady in Houston; Editing by Gerald E. McCormick)
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