frozen texas
February 25, 2021

When Texas deregulated its electricity market two decades ago, proponents promised that consumers would get better service at lower prices. Long before the service half of that equation proved spectacularly wrong during last week's freeze, the 60 percent of Texans required to buy their electricity from retail power companies, not local utilities, were already getting a lousy deal, The Wall Street Journal reports.

"Those deregulated Texas residential consumers paid $28 billion more for their power since 2004 than they would have paid at the rates charged to the customers of the state's traditional utilities," the Journal found, based on its analysis of federal Energy Information Administration data. "From 2004 through 2019, the annual rate for electricity from Texas' traditional utilities was 8 percent lower, on average, than the nationwide average rate, while the rates of retail providers averaged 13 percent higher than the nationwide rate."

The theory behind deregulating the electricity market was that forcing retail power companies to compete for customers would lead to innovation and lower prices. "In other states that allow retail competition for electricity, customers have the option of getting their power from a regulated utility," the Journal notes. Large parts of Texas don't have an incumbent utility to compete against, and the retail industry has been consolidating under two major retailers, Vistra and NRG Energy, which now control at least 75 percent of the retail market.

On the power generation side, Texas deregulation has rewarded companies that can sell cheap power to retailers and utilities — or sometimes really expensive power — but it provides little incentive and no requirements to invest in infrastructure that would have prevented last week's widespread blackouts. Now, "Republican Gov. Greg Abbott wants to force power plants to winterize," The Associated Press reports, and the GOP-led Texas Legislature will start lashing the state's grid operators in hearings Thursday.

"In a lot of respects, we're victims of our own attempt to let free market forces work," state Rep. Drew Darby (R) told AP. "Typically, you know, the Texas Legislature pushes back on overregulation," but "my view on something as basic to human survival and need is we need to have reliable power and water." State Rep. Rafael Anchia (D) agreed that "regulation is a four-letter word in this building at times," but said "four million people without power and 12 million people without drinkable water, right, that gets everybody's attention." Peter Weber

February 23, 2021

When demand for energy rose sharply last week in unseasonably frigid Texas, and power plants started going offline, the state Public Utility Commission (PUC) allowed wholesale electricity prices to jump to the maximum rate of $9 per kilowatt-hour, a 7,400 percent increase over the normal rate of 12 cents per kilowatt-hour, The Texas Tribune reports. "The rate hike was supposed to entice power generators to get more juice into the grid, but the astounding costs were also passed directly on to some customers."

Texas became national news because its power grid, overseen by the Electric Reliability Council of Texas (ERCOT), nearly collapsed and 4.5 million customers lost power. But "now that the lights are back on in Texas, the state has to figure out who's going to pay for the energy crisis," Bloomberg News reports. "It will likely be ordinary Texans."

"The price tag so far: $50.6 billion, the cost of electricity sold from early Monday, when the blackouts began, to Friday morning," Bloomberg estimates. "That compares with $4.2 billion for the prior week." Texas allows energy retailers to compete for customers, and those who opted for variable-rate plans face huge bills — up to $17,000 in one case. But even utilities with fixed-rate plans "that ran up huge losses as the cost of electricity skyrocketed last week will inevitably try to recoup those through their customers, taxpayers, or bonds," Bloomberg reports.

Texas Gov. Greg Abbott (R), who appointed the PUC, said Sunday he will work with the legislature to address the huge energy bills. But the customers' pain is the energy industry's gain, ProPublica and The Texas Tribune report. After a 2014 freeze, Houston's CenterPoint Energy bragged to investors that it "benefited significantly" from high energy prices during the resulting power squeeze, adding, "To the extent that we get another polar vortex or whatever, absolutely, we'll be opportunistic and take advantage of those conditions."

Under the Texas system, power companies not only aren't required to produce enough energy to avoid blackouts, "they are incentivized to ramp up generation only when dwindling power supplies have driven up prices," ProPublica and the Tribune report. That's incentive structure is a recipe for near-misses — and blackouts, said University of Houston energy expert Ed Hirs.

It is also bad politics right now. "We cannot allow someone to exploit a market when they were the ones responsible for the dire consequences in the first place," said state Rep. Brooks Landgra (R). Peter Weber

February 20, 2021

President Biden has approved a major disaster declaration for Texas as the state struggles to recover from deadly winter storms, the White House announced in a Saturday statement. That paves the way for federal assistance "to supplement state and local recovery efforts" in affected areas.

All 254 counties in the Lone Star State are eligible to receive public assistance, while people living in 77 counties are eligible to receive individual assistance, which "can include grants for temporary housing and home repairs, low-cost loans to cover uninsured property losses, and other programs to help individuals and business owners recover from the effects of the disaster."

In his own statement, Texas Gov. Greg Abbott (R) thanked Biden, who has said he intends to travel to Texas whenever his visit is no longer seen as a hindrance to recovery efforts. Tim O'Donnell

February 19, 2021

When the Texas power grid buckled under the strain of worse-than-expected winter cold, Texas Gov. Greg Abbott (R) went on Fox News and blamed frozen wind turbines for what was mostly a problem with natural gas–fueled power supply. Then he savaged the Electric Reliability Council of Texas (ERCOT), which manages the Texas-only power grid. But he has notably "gone easier on another culprit: an oil and gas industry that is the state's dominant business and his biggest political contributor," The Associated Press reports.

Abbott, in office since 2015, has raised more than $150 million in campaign contributions — the most of any governor in U.S. history — and "more than $26 million of his contributions have come from the oil and gas industry, more than any other economic sector," AP reports. In a news conference Thursday, Abbott mostly blamed ERCOT for assuring state leaders Texas could handle the storm.

ERCOT is overseen by the Texas Public Utility Commission, whose three-member board is appointed by Abbott. But the Texas legislature is broadly responsible for energy policy. And everyone knows what would have to be done to avoid a repeat of these blackouts and water outages: Winterize the state's power generators and plants, as the state was advised to do after 2011 winter blackouts, and 1989 winter blackouts before that.

Abbott on Thursday urged the Texas legislature to make full winterization mandatory, not voluntary, for the private companies that generate and feed the Texas power supply. That would be really expensive. And Abbott wasn't clear about who he envisions footing the bill: taxpayers, consumers, or the oil and gas companies that fund his political career.

ERCOT, power suppliers and retailers, and state commissioners will soon be hauled before legislators for "all of the shaming and blaming" they can dish out, Ross Ramsey writes at The Texas Tribune. "But the end of that show is the wrong time to stop paying attention; it's the time to start."

That's when Abbott and legislators will decide if "swapping light regulations and low energy costs for the risk of leaving Texans exposed to the harshest winter weather is worth it," Ramsey writes. "If the public keeps paying attention, it's probably not. If the public leaves the details to legislators and the usual crowd of special interests, the state might do what it did last time: Waggle those fingers, write a report, and put the matter away until it gets cold again." Peter Weber

February 18, 2021

"First Texans lost their power," The Texas Tribute notes. "Now, they’re losing their potable water." After three days of frigid temperatures, some of the state's biggest cities on Wednesday warned residents who still had water service to turn off their dripping faucets, conserve as much water as possible, and/or boil their water because they can't guarantee it's safe to drink.

By late Wednesday afternoon, the Texas Commission on Environmental Quality said, about 590 public water systems in 141 counties had reported disruptions in service, affecting nearly 12 million Texans. About 7 million Texans, a quarter of the state's population, were ordered to boil their drinking water or stop using it entirely, The Associated Press reports. TCEQ executive director Toby Baker attributed the water issues to frozen and cracked water mains, thousands of busted residential pipes, and people dripping water from the faucets to prevent burst pipes. Baker said the boil water notices will last until the state's 135 labs can assure Texans their local water is potable.

"It's not clear when water supplies will be replenished, but energy constraints often have impact on the water system because the water system requires energy for treatment and pumping," Michael Webber, an energy resources professor at the University of Texas at Austin, told the Tribune. Austin and Houston were among the cities that told residents to boil their water. Kyle, a town of 45,000 south of Austin, told its residents Wednesday that "water should only be used to sustain life at this point."

So millions of Texans with water and power are being urged to boil their water, people with power but not water can presumably melt snow, and those with water but no power can still flush their toilets and wash dishes, if it is warm enough to do so. Food is a problem, because stores are closed in many areas and loss of refrigeration, and pipes are still in danger of bursting through Friday. But utilities have restored power to all but 940,000 customers and by the weekend, temperatures should be above freezing throughout the state. Peter Weber

February 18, 2021

Texas is nearing the end of what Gov. Greg Abbott (R) called "a once-in-every-120-year cold front," but that doesn't entirely explain why more than a million households still had no electricity early Thursday, after three full days of below-freezing temperatures. Plenty of places in the world keep their power on in prolonged arctic weather, and so did parts of Texas.

Those edges of Texas, including El Paso, "are primarily in areas outside of those supported by ERCOT, the Electric Reliability Council of Texas, which manages the electric grid for 90 percent of the state and operates separately from federal oversight and regulation," KHOU 11 Houston reported Wednesday night.

After the 2011 winter freeze, El Paso Electric, on the Western Interconnect grid, spent heavily to "winterize our equipment and facilities so they could stand minus-10 degree weather for a sustained period of time," Eddie Gutierrez, an El Paso Electric spokesman, told KHOU. So this year, "we had about three thousand people that were out during this period, a thousand of them had outages that were less than five minutes."

On the other side of Texas, near the Louisiana border, the city of Beaumont also appears to have weather the storm without massive outages. Entergy, which powers Beaumont on the Eastern Interconnect grid, told KHOU it also winterized its infrastructure after the 2011 storm. Weatherizing power generation and extraction equipment is voluntary in Texas, though the state legislature will probably revisit that strategy when it dissects ERCOT this year. Peter Weber

February 18, 2021

While millions of Texans were without power in below-freezing temperatures Tuesday night, Texas. Gov. Greg Abbott (R) went on Fox News and told Sean Hannity that the failure of the state's power grid "shows how the Green New Deal would be a deadly deal for the United States of America." Abbott said "our wind and our solar got shut down," which "thrust Texas into a situation where it was lacking power in a statewide basis." The main culprit for the Texas power outages is failures in the natural gas sector, though, so on Wednesday, Abbott walked back his comments.

"I was asked a question on one TV show about renewable, and I responded to that question," Abbott said. "Every source of power that the state of Texas has has been compromised, whether it be renewable power such as wind or solar, but also, as I mentioned today, access to coal-generated power, access to gas-generated power, also have been compromised."

For all of 2020, 40 percent of Texas energy came from natural gas–fired plants, 23 percent from wind turbines, 18 percent from coal, and 11 percent from nuclear power, according to the Electric Reliability Council of Texas (ERCOT), which manages the Texas power grid. But in the winter, only about 7 percent of ERCOT's capacity was projected to come from wind sources.

"Texas is still fossil-fueled," and it's obviously silly to suggest "the Republicans who run the state had accidentally adopted a Green New Deal that eliminated fossil fuels and destroyed the reliability of the grid," Michael Grunwald writes at Politico. "The real problem in Texas is the freaky weather, and unfortunately, climate change is delivering a lot more freaky weather" — a phenomenon Texas Tech climate scientist Katharine Hayhoe calls "global weirding."

Abbott, in explaining the Texas grid failures, pleaded Wednesday that "this is a once-in-every-120-year cold front that we have to respond to." But "today, only a fool expects a hundred-year drought or flood or snowfall event to happen once every hundred years," Grunwald said, and Texas — and America — need to prepare accordingly. Peter Weber

February 17, 2021

Texas Gov. Greg Abbott (R) is using his state's overwhelming blackouts as a deceptive excuse to attack the Green New Deal.

More than 2.5 million Texas power customers remain in the dark after unprecedented winter storms froze several of the state's power sources. While some of the state's unweatherized windmills did freeze up, most of the blame lies with natural gas shortages. That's exactly what Abbott told Dallas-area ABC affiliate WFAA on Tuesday night, describing how natural gas has frozen up and prevented manufacturers from extracting and shipping it to power plants and customers.

But when Abbott appeared on Fox News and faced a national audience, he told a different story. "This shows how the Green New Deal would be a deadly deal for America," Abbott told Hannity, particularly noting how solar and wind power got "shut down." Abbott then noted those sources account for 10 percent of the state's energy, neglecting to mention how the other sources making up a far larger majority failed as well.

Millions of Texans still don't have power days after the state's independent energy grid failed, leading to the deaths of several people in the state. While it's true that some of Texas' windmills weren't properly prepared for a deep freeze, others were still overproducing power early in the story. Kathryn Krawczyk

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