Valentine’s Freeze of 2021: Texas as a Cautionary Tale

Public and private failures have struck both California’s and Texas’ power grids in recent years. Why is this? Is this a failure of the marketplace, of public utility commissions, of capitalism, or of our elected officials?

Many failures combined, along with a series of events, to cause the Valentine’s Freeze of 2021 in Texas.

Cascading failures also resulted in power outages in California.

Why does this happen across the United States? Why do our public and private infrastructure projects keep failing?

The difficult truth for ideologues is that power generation and distribution have failed in very different states, and within those states in very different local jurisdictions.

The City of Austin owns Austin Energy. It’s not a private company. It operates as a public utility, yet had some of the worst production failures. This isn’t an example of privatization gone wrong, at least not throughout Texas. Nor are California’s problems ideologically based.

We can argue about energy markets, regulation, and the best balance between affordability and reliability. We have come to expect, unreasonably, perfect reliability from everything in our lives. We’re living at a time when electricity and water tend to be readily available. We have high expectations, even as utilities regularly meet 99 percent up-time standards. We want 99.99 percent reliability.

How much would another 0.1 or 0.01 percent reliability cost? Is that cost justified? And do people understand perfect is impossible?

I want an open energy market and segmented grid. Regulations are not “socialism” or “communism” and open markets need not descend into crony capitalism or corporatism.

As a “libertarian-left” classical liberal, I believe natural resources are “owned” by nobody and serve the common good. You can own the intellectual property that converts the resources. You can and should be rewarded for innovation when it comes to the production and distribution of resources that might not otherwise be possible. However, in the end, nobody should be able to “own” water, gas, oil fields, et cetera. Thankfully, nobody is trying to own the sun or wind.

Returning to Texas and California, they are trying different models of production and distribution and both have a history of failing the public good. Worse, the systems have led to property destruction and the loss of life.

Slogans and memes don’t reflect the nuance of our economy or our public infrastructure. We rely on a public-private hybrid model for most utility services in the United States. Curiously, in most of Europe, utilities are privatized, so it’s not a uniquely “American” hybrid model.

What failed wasn’t Texas or California; it’s not as simple as “Red State” or “Blue State” philosophies.

ERCOT and the Public Utility Commission of Texas

There’s some confusion claiming Texas power is all privatized. ERCOT is not quite a state agency, but it is a Government Sponsored Enterprise and 501(c)4. ERCOT reports to the Public Utility Commission of Texas (PUCT). ERCOT uses some of the latest technology available as it manages the flow of electric power to more than 26 million Texas customers, representing about 90 percent of the state.

The ERCOT board, in theory, includes representatives from academia, consumer groups, and energy companies. The organization is funded by membership fees paid by the power suppliers. (Many state and federal agencies are also supported by fees collected by regulated industries.) The structure of the ERCOT board was intended to keep it independent, but that’s never easy.

Quick example: The Federal Aviation Administration needs to employ aviation experts. Most of those experts have worked or will work within the aviation industry. Likewise, ERCOT board members end up being energy experts who have or will work within private energy companies and non-profit energy advocacy groups.

ERCOT is mandated by state law to balance “lowest reasonable cost” with 99% reliability. The state legislature has long held that low energy prices help attract businesses to Texas and employ its residents. We can debate if that’s politicians putting businesses ahead of voters, but the voters keep returning these officials to Austin.

The energy grid in Texas is not an example of deregulation. It is not libertarian. It is a state system with a mandate to emphasize price and a reliability threshold.

It failed, yes, but not because it’s private or some Wild West or Ayn Rand creation.

It failed because they didn’t plan for cold weather after 2011’s failure.

Notably, El Paso did fine during the Valentine’s Freeze. After experiencing devastating problems in 2011, El Paso’s leaders received voter support to harden their local electricity grid and power stations. The voters understood the need… after a disaster. El Paso is also connected to the Western Grid, offering extra security when local generation fails.

Weather won in Austin, a progressive city that even owns a power plant. Austin’s plant was offline.

People might know this, but Austin owns a power plant. To save money, the city leaders opted to use the plant seasonally, during summers, because that’s when Texans use the most electricity. Power plants cannot be turned on or off quickly, so Austin was unable to activate its biomass plant during the freeze.

National Infrastructure Neglect

The American Society of Civil Engineers monitors the infrastructure of the United States. ASCE Infrastructure Report Card was last revised in 2019, when our national grade was D+. At that time, our national infrastructure needed an estimated $4.5 trillion in repairs, upgrades, and general maintenance.

Our infrastructure is crumbling, and we know it. But, voters don’t want to do anything about the problem and politicians prefer new projects over fixing what already exists.

State reports are updated on a rotating basis. In 2021’s ASCE reported that Texas earned a C, barely surpassing California’s most recent grade of C-. In other words, our two largest states, despite their political differences, are both in serious trouble.

Years of neglect will now require the complete replacement of some infrastructure. If you don’t maintain a system, it rots.

It’s bad enough that we, as citizens of states and the nation, have allowed the infrastructure to rot. Yes, I place the blame squarely on voters. Even if 49 percent supported spending on maintenance (which is not the case), a majority of local and state voters keep rejecting infrastructure bonds. They will often approve new projects on the same ballot rejecting maintenance expenses.

National politicians also favor shiny new projects, like high-speed rail, over fixing water pipes and power grids.

And then, there’s the weather. The climate is changing, and why it is changing matters less than how we adapt.

Weather vs. Infrastructure

Natural forces destroy things. Watch a few episodes of Life After People or browse “urban decay” photos on the Internet. Nature tears apart anything humans build. Some structures last longer than others. Sadly, we aren’t building pyramids or Roman aqueducts.

The weather in Texas, California, and elsewhere is changing. Our yard features native and adapted plants considered ideal for Central Texas. It looks like several of them died in the freeze. The summers are warmer, the winters are colder. Plants are rated for ranges of temperatures, not extremes. Yet, extremes are what we’re having.

Engineers are now trying to explain that you can harden energy production for either extreme hot or extreme cold, but not always both. That means some systems will fail, at least until we can find cost-effective solutions that work from -15 degrees through 115 degrees  Fahrenheit. That’s quite a range to manage. Record heatwaves and record cold snaps cause extreme changes to materials. Water expands as ice, cracking pipes. Other liquids might also freeze, as my wife and I learned in Minnesota. Even “ice melt” chemicals stop working at some point. In the heat, other things go wrong.

As Politico reporters noted this week, weather wins in both California and Texas, no matter who runs the power grids or what the regulators might try to mandate.

Politico.com
Texas and California built different power grids, but neither stood up to climate change

By ERIC WOLFF, DEBRA KAHN and ZACK COLMAN
02/21/2021 07:00 AM EST

Texas and California may be worlds apart in their politics and climate policies, but they have something in common: Extreme weather crashed their power grids and left people stranded in the dark.

The two sprawling, politically potent states have devoted massive sums to their power networks over the past two decades — California to produce huge amounts of wind and solar energy, Texas to create an efficient, go-it-alone electricity market built on gas, coal, nuclear and wind. But neither could keep the lights on in the face of the type of brutal weather that scientists call a taste of a changing climate.

The weather extremes are the “new normal” according to some experts. I don’t know if that’s the case, but data suggest it might be. Federal officials have tried to caution the public that climate change will require new approaches to power generation and distribution.

“The one common element from the California situation and what appears to be the case in Texas, is weather,” Richard Glick, chair of the Federal Energy Regulatory Commission, told reporters Thursday. “All the experts tell us this type of wild unanticipated weather is going to happen much more frequently than has happened in the past. It’s incumbent on us and others to ensure the grid is more resilient against those particular extreme weather events.”

One weather failure turns into another failure, and then another vulnerability in the system is exposed. Failure multiplies and cascades.

Moments of Failure Multiply

Our neglected infrastructure cannot handle the uneven use cycles caused by extreme weather and other emergencies. Power supply systems and distribution networks fail under surges of use or sudden drops in production. If everyone turns on appliances, especially air conditioning, California’s suppliers and grid cannot meet demand. In Texas, supply dropped rapidly as production went offline (or was already offline) during the late freeze.

Some situations can be predicted, yes, like summers in California or winters in Minnesota. But, a February freeze in Texas is just plain weird. The week before, we were in the 80s and people were using swimming pools. The freeze actually hit as some plants were undergoing routine maintenance before the summer usage spikes. We were not prepared.

One moment of failure. That’s all it took to take down most of Texas’ power grid.

In an effort to reduce carbon emissions and bring more power generation in-state, California set aggressive renewable targets, increasing the amount of solar capacity on its grid in the past decade to 27 gigawatts in 2019, more than one-third of the nation’s solar output, according to the Solar Energy Industries Association. And to balance its grid, it’s helped build an 11-state power market that enables it to export excess solar power during the day and draw in electricity from other sources after sunset.

But August’s unplanned blackouts — the state’s first since the energy crisis of 2000-2001 — underscored other weaknesses in California’s grid. A state analysis of the failures that shut off power for 490,000 customers for two hours one night and 320,000 customers for less time another night, pinned blame on the historic West-wide heat wave, which saw demand surge and limited the amount of power California could import from other states. But it also pointed to the state’s high proportion of renewables, which see their electricity output drop sharply as the sun goes down, requiring other power plants to ramp up quickly — and which they were unable to do that week.

Like California, Texas suffered from an energy shortage at a key moment: In the space of an hour early Monday morning, 30 gigawatts of generation — one quarter of the state’s entire capacity — dropped off the grid just as a deep freeze drove demand up to levels usually only seen in summer. That led to several days of blackouts affecting 4.4 million Texas customers.

“Black swan” events will occur and we won’t be prepared. We might prepare for cold snaps and heat waves, yet something else will happen and take down the grids. One small failure will cascade. My fear is that the next failure might be created, such as an act of terrorism.

Failures will Happen Again

Yes, I am arguing that people need to realize failures will happen. It’s just not possible to make life 100 percent perfect and utopian. We might do everything “right” and one accident, one act of terrorism, or one natural disaster will take everything offline again.

“First and foremost, we need to recognize, we probably can’t prevent every outage of this kind that we’re probably going to be seeing over the next 30 years,” said Mark Dyson, a principal for electric power with the clean energy think tank Rocky Mount Institute. “It’s well past time to recognize a fundamental vulnerability of the power system and take advantage of where we are now with digital technologies, more distributed technology, storage, and flexibility and deal with the root cause and not play whack a mole with these large scale systems.”

We need to do all we can. We need to invest heavily in our infrastructure and realize the blame rests with all of us for not demanding better of elected officials and the power suppliers. We, the citizens and voters and customers, grew complacent. We will be complacent again, sadly, and let this event fade from memory. That seems to be the pattern in California, Texas, and elsewhere.

It is possible to accept that perfection is impossible and demand more reliability.