State lawmakers and Gov. Greg Abbott have said making sure Texas never suffers a blackout like the one we just went through is a top priority this legislative session. What can they do to keep that promise?
Hearings this week in the Texas House and Senate helped answer that question.
Here are eight things that became clear during the hearings:It Goes Beyond ERCOT
Texas' grid operator, the Electric Reliability Council of Texas, received most of the blame in the immediate aftermath of the blackouts. The group made the decision to cut power to millions rather than let the grid suffer a catastrophic failure.
But ERCOT always maintained it was just following the rules state lawmakers and regulators laid out. In the hearings, it became clear that some lawmakers agree.
Some are now calling for the resignation of DeAnn T. Walker, the chair of the Public Utility Commission of Texas.
Lawmakers also tried to reconstruct a timeline of inter-agency communication. They asked about phone calls between ERCOT, the Public Utility Commission, the Railroad Commission (which regulates oil and gas) and the governor’s office.
Why?
To figure out who knew how bad the blackouts could get and when they knew it.
The Finger Pointing Continues
State agencies are trying to avoid blame for the blackouts, but so are the different parts of the energy industry. On the first day of the hearings, power plant operators put much of the blame on gas producers’ failure to supply natural gas. That's because equipment along the gas supply line had frozen up and broken down in the cold.
The second day, the oil and gas industry said that wasn’t so.
While quietly acknowledging there had been some weather-related breakdowns, they said the biggest cause was the blackouts themselves. They said gas equipment got its power cut and couldn’t produce or transport gas.
If you follow this logic to its natural conclusion, it means the blackouts caused gas to stop flowing which caused the blackouts which caused the gas to stop flowing which caused the blackouts which... you get the idea.
On Friday State Rep. Eddie Lucio III (D-Brownsville) said he thought lawmakers would get to the bottom of it.
“We’re going to find out what percentage of compressors and the infrastructure that you regulate was shut off,” he told Texas Railroad Commission chairwoman Christi Craddick.
Who Manages No-Cutoff Lists?
Local utilities and power suppliers have lists of “essential infrastructure” that, if possible, should not be shut off in a blackout. The hearings revealed that natural gas producers and other energy operators can fill out a form to be included on that list. What was not made clear was whose job it is to get them included so they don’t lose power in a blackout.
“I didn’t know that was an opportunity,” Craddick told lawmakers.
Power Generators Might be Reluctant to “Weatherize”
Again, one reason much of the state lost power was because power plant equipment and components of the natural gas supply line froze up. The Governor has ordered lawmakers to find a way to fund the “winterization” of that equipment.
But at the hearings, industry leaders made that sound like a complicated proposition.
Owners of Texas power plants and oil and gas operators told lawmakers that a lot of their equipment is built to withstand summer heat. They said it may be difficult, in some cases, to both insulate equipment from the cold and the heat.
A Market Structure Overhaul?
Texas has something called an “energy only” electricity market. Power generators are paid only for the electricity they produce. In other parts of the country, electric generators get paid just to be there, in case they’re needed. That’s called a “capacity market.”
During the hearings, power plant operators and even the chair of the Public Utility Commission spoke openly about changing this system.
The potential upside? More electric capacity when supply gets tight. The downside? Whether it’s through higher electricity rates or tax dollars, the public would pay for those extra power plants to sit there.
Some analysts also say a capacity market would not have saved Texas from the blackout if those extra plants ran on natural gas — because they can’t run when the gas supply line is broken in the cold.
Variable Rate Electric Plans Could Be Made Illegal
After the blackouts, you might have heard about people who got huge electric bills. These people were customers of electricity retailers who sell power based on the wholesale spot market.
So, when the price of power went through the roof during the blackout so did their bills.
At the hearings many in the industry and government suggested those plans should be made illegal.
"Consumers shouldn’t be exposed to real-time wholesale electric prices,” Mauricio Gutierrez, CEO of the power company NRG told lawmakers. “These plans from my perspective shouldn’t be allowed.”
Lori Cobos, public counsel for the Office of Public Utility Counsel, also said residential and small business customers should not be able to participate in those plans.
Lawmakers Aren’t Talking About Linking Grids With The Rest of The Country
“We came dangerously close to losing the entire electric system.”Curt Morgan, Vistra Energy CEO
Texas is the only state with its own, separate electrical grid. That’s what failed and lead to the blackouts. The state maintains that grid independence because Texas leaders want to avoid federal oversight.
In the wake of the blackouts, some analysts suggested that should change. But the idea got little to no attention from lawmakers, leading observers to wonder if it is completely off the table for some reason.
While Texas officials have not proposed ending Texas grid independence, federal officials have.
Newly-confirmed Energy Secretary Jennifer Granholm is saying Texas should link up. She thinks the spare power supply the rest of the country could provide might help avoid another blackout.
We Were Very Close To Total Grid Failure
Some of the most frightening testimony was about the instability the electric grid experienced in the first hours of the storm and blackouts.
On Thursday, Curt Morgan, CEO of Vistra Energy, told lawmakers his company was “three minutes away from losing” its Comanche Peak Nuclear power plant because of frequency issues on the grid.
That one power plant going offline could have crashed the entire grid, maybe for weeks.
“We came dangerously close to losing the entire electric system,” Morgan told lawmakers.
