Texas Is Heading Towards An Avoidable Blackout…Again

With seven people killed and nearly a million people without power, recent storms have hit Texas hard. Restoring power may take days and may not be complete by Wednesday.

The isolation of Texas’ power grid has in recent years become a symbol of the state’s independence and its resistance to federal oversight. Massive outages during Winter Storm Uri in 2021 were a wake-up call about the vulnerabilities of the Texas system. But Texas hit the snooze button, leading to repeated crises in summer 2022 and winter 2023. Now it appears Texas is descending into another avoidable crisis, with record temperatures approaching and the Energy Reliability Council of Texas (ERCOT) issuing a notice that the grid may reach emergency conditions beginning the evening of Friday, May 17.

The isolation of the Texas power grid began in 1935 when Congress passed the Public Utility Holding Company Act (PUCHA). which targeted energy monopolies to lower costs for consumers, while power companies isolated themselves from other states to avoid federal regulation and maintain monopolies, made possible by the state’s size and abundance of its natural resources. ERCOT was then created in 1970 to manage the state’s electric grid and wholesale energy market. Today, ERCOT is regulated by the Public Utility Commission of Texas (PUC) and is responsible for meeting approximately 90% of the state’s energy demand.

ERCOT’s flaws were on full display in February 2021, when a perfect storm of disastrous conditions emerged: just as cold weather caused a surge in energy demand, natural gas production, and power plants were collapsing, stunned by weather conditions as energy suppliers and weather conditions. the forecasting services had underestimated. ERCOT reported that demand peaked at 69,000 megawatts, far exceeding any predicted worst-case scenario. As a result, more than 4.5 million homes were left without power and at least 200 people died as a result of the storm.

The isolation of the Texas grid was a key factor in the inability to supply the state with electricity during such an event. The Eastern Interconnection and the Western Interconnection cover the rest of the United States, and stronger ties with these two energy-sharing networks could have provided more sufficient safeguards and backup energy sources as the cold was sweeping the state.

The city of El Paso demonstrates the protection afforded by power sharing: it is part of the Western Interconnection and not the ERCOT grid, which allows the city to withstand frost better than Houston or Dallas.

An isolated grid also creates ongoing problems, even when no bad weather impacts the state. Wholesale spot electricity prices in Texas are $175 per megawatt hour (Mwh) for the month of August, up from $90.18 in August 2023. Price increases of this magnitude are not uniform across United States. Spot electricity prices in California for the month of August are trading at $80 per MWh, 30% lower than last year’s average. By allowing these problems to persist, average Texans will continue to bear the brunt of rising costs.

U.S. Rep. Greg Casar (D-Austin) recently introduced the Connect the Grid Act, which would require ERCOT to interconnect with neighboring power grids and subject the agency to FERC oversight. However, significant Republican opposition signals that this plan is very unlikely to pass, meaning interconnection will still be a long time coming.

There is still a glimmer of hope. The power grid successfully withstood another cold snap in January, thanks to a surge in battery construction and a surge in solar and wind power that allowed Texas to diversify and decentralize its energy production to meet growing demand.

Texas’ decades of isolation from the rest of the nation’s power grid have led to increased costs for consumers and deadly outages that threaten the health and safety of Texas residents. To meet the state’s growing energy needs, Texas must end the fantasy of ERCOT isolated from the rest of North America.