Thermal Coverage Ratio

The Thermal Coverage Ratio is the share of a power system's annual summer peak demand that dispatchable thermal capacity could meet on its own.

Why it exists

Most conversations I have about data center power come back to the same question. Not what a grid can supply on an average day, but what stands behind a connection on the hardest hour of the year.

Existing measures don't answer that directly. Reserve margins blend every resource together, weighted by its expected contribution. Interconnection queues show what might be built, not what has been. I wanted a simple, structural number: how much of the peak still rests on capacity that runs when told, whatever the weather. I couldn't find one published, so I built it.

Results

Each market is built the same way, from the same public sources. This table grows as the series is published.

What it is not

• Not a reserve margin. It counts only dispatchable thermal capacity. Nobody argues thermal should cover 100% of the peak.

• Not an adequacy forecast. It makes no probabilistic claim about outages or load shed. Grid operators' adequacy studies do that job.

• Not a judgment on renewables or storage. A falling ratio means more of the peak depends on weather-dependent resources and storage duration. Whether that is a problem depends on how well those resources cover the hours that matter.

Method

Numerator: dispatchable thermal capacity

• Net summer capacity of gas combined cycle, gas combustion turbine, gas steam turbine, gas reciprocating engine and coal units.

• Source: EIA Form 860M, Preliminary Monthly Electric Generator Inventory. The Operating and Retired tabs are combined so the fleet can be rebuilt for any past year.

• Boundary: the market's balancing authority (or RTO zone, where stated). Units in neighboring balancing authorities are excluded, even within the same state.

• Timing: a unit counts in a year if it entered commercial operation before the peak month and retired after it.

Denominator: summer peak demand

• The market's published annual summer peak, hourly basis. Preliminary values are marked and updated after final settlement.

Excluded by design

• Nuclear. Firm, but not load-following. Shown separately. In ERCOT, including it adds about 5.5 points in 2026.

• Imports, demand response, wind, solar and storage.

Variants published alongside the core ratio

• Broad: adds petroleum, other gases, biomass and landfill gas.

• Conservative: removes units currently listed as out of service and not expected to return.

Reading the ratio

• The trend matters more than the level. Compare a market with itself over time. Markets differ in imports, nuclear and resource mix.

• The gap in MW is often the more useful number. It shows how much of the peak depends on non-thermal resources at that moment.

• Watch the weather. A hot summer lifts the peak and lowers the ratio. A mild one does the reverse. One year's move is not a trend.

• Peak hour is not the hardest hour. In solar-heavy systems, the binding hours are moving into the evening. The ratio is measured at the peak, so it understates evening exposure.

Known limits

• EIA-860M records each unit's current summer rating. Uprates and derates since 2019 are not reflected historically.

• Units now out of service are counted in past years, because their out-of-service date is not recorded. The conservative variant shows the effect.

• Capacity is not availability. Forced outages and fuel constraints at peak are not modeled.

• Balancing authority boundaries do not always match how markets are discussed. Each market analysis states its boundary.

• Storage is excluded from the ratio and reported separately, because its contribution depends on duration and state of charge.

How to cite

Marshall, A. (2026). Thermal Coverage Ratio. alexmarshallenergy.com/thermal-coverage-ratio

Challenge the method.

If you plan, operate, finance or build in one of these markets and see something I have missed, tell me. Corrections are made publicly and logged below.

Version history

• 1.0 (October 29, 2026): definition, method and ERCOT results published.

Related frameworks

• Speed to Power

• Structured Transition Model

• Infrastructure Half-Life

Five Nines and Fast Power

Making Better Decisions in AI Energy Investments

Questions and Answers

What is the Thermal Coverage Ratio?

It is the share of a power system’s annual summer peak demand that dispatchable thermal capacity could meet on its own. It shows how much of the peak rests on capacity that runs when dispatched, whatever the weather.

How is it calculated?

Divide dispatchable thermal net summer capacity in MW by annual summer peak demand in MW. In ERCOT in 2026, 75,775 MW of gas and coal capacity against a 91,134 MW peak gives 83.1%. The gap, peak minus thermal capacity, was 15,359 MW.

What counts as dispatchable thermal capacity?

Gas combined cycle, gas combustion turbines, gas steam turbines, gas reciprocating engines and coal. These are units an operator can start and dispatch on command. A broad variant also adds petroleum, other gases, biomass and landfill gas.

Why is nuclear excluded?

Nuclear is firm, but it does not follow load. The ratio is meant to capture capacity that can be dispatched up and down on command. Nuclear capacity is reported separately so readers can add it back. In ERCOT it would add about 5.5 points in 2026.

How is it different from a reserve margin?

A reserve margin counts all resources, usually weighted by their expected contribution at peak. The Thermal Coverage Ratio counts only dispatchable thermal capacity. It is a structural measure of dependence on weather-dependent resources and storage, not an assessment of whether the system is adequate.

What is a good or bad ratio?

There is no target level. Markets differ in imports, nuclear and resource mix, so comparing levels across markets can mislead. The trend within one market is what matters. A steady fall means more of each new peak depends on resources other than dispatchable thermal plants.

Does a falling ratio mean the grid is less reliable?

Not on its own. Solar, wind and storage can cover the peak hour well, as they did at ERCOT’s 2026 record. The question a falling ratio raises is about the hours after the peak, when solar fades and storage duration becomes the constraint.

Why summer peak?

Summer is still the annual peak in most of the markets in this series, and net summer capacity is the standard rating for that season. Some markets now set peaks in winter. Where that is material, a winter variant using net winter capacity will be published alongside.

Why does it matter for data centers?

Data centers are flat loads that draw nearly the same power day and night. A falling ratio means each new megawatt of flat demand leans more on weather, storage duration and evening ramps. That makes firm capacity a scarce attribute, and it changes the case for large loads that bring their own dispatchable generation.

Where does the data come from, and can I reuse it?

Capacity comes from EIA Form 860M, and peak demand from each market’s published records. Every workbook lists the units behind every number. The data is published under CC BY 4.0, so you can reuse it freely with attribution.

How often is it updated?

Each market is refreshed once a year, when new peak data and the updated EIA generator inventory are available. Corrections are made as soon as they are found and logged in the version history.

Who developed it?

Alex Marshall, who has worked in distributed energy for over 20 years. The ratio is his own work, uses only public data, and is published independently.