1. Economic Forecast Review
ERCOT
Calvin Opheim
October 12, 2012

2. Outline
Forecast Overview
Economic Forecast Review

3. Forecast Overview
To create a long-term load forecast requires:
Employment or economic data forecast for each county for the duration of the forecasting time-frame
Hourly weather forecast for each weather zone which will be used for each forecasting year
These values are used by forecasting models to create the hourly demand forecasts for ERCOT
The employment forecast drives the long-term energy and demand forecast since the weather forecast is constant

4. Economic Assumptions
Moody’s provides ERCOT with three county-level economic forecasts:
Base
High economic growth
Low economic growth
Which forecast should be used?

5. Moody’s Non-Farm Employment Scenarios – 11/8/2011
2009 to 2022 AAGR
Low 1.8%
Base 2.3%
High 2.8%
2000 to % AAGR
AAGR – annual average growth rate

6. Moody’s Non-Farm Employment Scenarios – 11/8/2011
2012 to 2015 AAGR
Low 3.2%
Base 3.7%
High 4.3%
8/30 update 3.3%
2003 – 2008 had a 3.0% AAGR in non-farm employment
AAGR – annual average growth rate

7. Energy and Non-Farm Employment
AAGR – annual average growth rate

8. Historical Non-Farm Employment Forecasts (low case)

9. Historical Non-Farm Employment Forecasts (base case)

10. Historical Non-Farm Employment Forecasts

11. Historical Non-Farm Employment Forecasts

12. Actual Non-Farm Employment Data

13. Summary
ERCOT reviews the non-farm employment forecasts
ERCOT has added an additional provider of economic data (Woods and Poole) in 2012
ERCOT is exploring receiving additional economic forecasts from Moody’s

14. Questions ON
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