Exactly one year ago to the minute – February 15 at 1:25 a.m. – the power went out in Texas from a major winter storm. Eleven million people would lose power over the next three days, there would be 246 official deaths (though some say that number is as high as 700), Texas would lose somewhere between $80 and $130 billion (with entire cities going bankrupt), and the blame game began as to how it all happened.
It’s been one year since the Texas power grid disaster. What has changed since then?
One major factor behind the blackouts was a lack of weatherization. Many power plants had cold-related outages, and natural gas froze in the pipelines before it even reached many other power plants. On top of it all, the wind barely blew. As a result, we only had 9 GW of wind show up, combined with 25 GW of natural gas outages”). Once the ice thawed and the power was restored, the resounding consensus was that weatherization across the board was direly needed.
Since then, the Texas Legislature passed Senate Bill 3 that would, among other things:
But this “critical” designation opened up a giant loophole for gas facilities. The Railroad Commission, which oversees the gas industry and has huge lobbying power in the state, proposed a $150 fine each facility could pay to opt-out of weatherization.
After some blowback, they have since said they would require pipelines, processing plants and some wells to winterize. But already there have been lots of delay tactics. These rules won’t be finalized until the end of 2022, leaving much time for more changes.
Energy companies lost billions of dollars from the storm and they will be looking to recoup those costs somehow. After ERCOT massively misforecast demand for the coldest days (detailed in depth by Amperon’s data science team), a lot of retailers had to buy energy on the real-time market, where the PUC artificially forced prices to stay at the maximum rate of $9/kWh for four full days, even though it became clear pretty quickly the high prices had little impact on encouraging more generation to come online.
Lawmakers have passed multiple bills in response that would:
With companies looking to make up for lost profits, electricity rates will be going up. Comparing plans on Power To Choose from February 2021 to February 2022, rates have already increased by 13% for 500 kWh, 20% for 1,000 kWh and 23% for 2,000 kWh. Even the average cancellation fee increased from $124 to $140. While these companies will be getting help, it looks like the consumers will be getting little relief and will bear the brunt of the grid failures.
Everybody needs a boogeyman to blame when things go wrong. So when Texas consumers got $17,000 electric bills, a lot of focus centered on pass-through, wholesale energy plans, with time-of-use retailer Griddy being the main culprit.
Even though only about 25,000 out of Texas’ 11.7 million electricity customers were on Griddy, Texas legislature’s first major bill out of the storm fiasco was to:
While consumers should not be on the hook for these bills, this legislation will put a pause on innovation for a bit. Griddy’s model was an attempt to see if time-of-use could impact on consumer load – which helps balance the grid, reduces carbon emissions, and prevents blackouts. Instead of lawmakers working for a way forward that shields consumers from giant risk, while also incentivizing energy conservation – they just banned it outright.
We’d like to think last year was a wake-up call – if a similar major blackout hadn’t already happened in 2011. Back then they also called for more winterization and preparedness and wanted to make sure what happened then wouldn’t happen again. Let’s hope lawmakers and regulators have finally learned their lesson after second time’s the charm.
There is no one person or entity to blame for what happened last February. But there is one thing for sure: the energy transition is happening. There are going to be more extreme weather events; grid operators will have to prepare for two annual peaks, not just one; more renewables will be coming online, making major changes to generation.
While we were recapping what happened last year, a couple of Amperon employees shared what they were doing when the power went out in Texas.
"In the beginning of February, we knew something big was going to happen. We were looking at the predictions and started to let our customers know so they wouldn't be caught off guard. I even posted suggestions on what to do if you were to spend Valentine's Day in the dark.
When I went to bed that night, I prepared the house in case we were to lose power – the pipes were taken care of and I filled pots with water. Then around 2 a.m., I woke up after hearing a loud noise and the power was completely out. My wife was very pregnant at the time so we went to stay with a friend in downtown Houston who lived next to the prison. We thought, if there is one place that won't lose power, it is there. Driving around the city the next day was crazy, the whole city was completely dark."
CEO of Amperon
“I’m a Scoutmaster. So when we lost power, I took out all of our cold weather gear and had a campout in the living room. We did our best to stay warm for those couple of days we were without power.”
Senior Account Executive
“I had no power, no heat and was sharing a king-size bed with 2 cats, a dog, a two year old, and an EXTREMELY pregnant wife.”
EVP of Market Operations
“I had a pipe burst in my bedroom closet so I went to stay at my brother’s house in The Woodlands. My shower didn’t work for a month because we had to replace the pipes in there from buildup after the freeze.”
Sales Development Representative
“I was living with some family (my uncle, aunt, and two younger cousins) when all of the power went out around 7 or 9 a.m. We all took it well for the first four hours because my cousins hadn’t seen snow before and they were excited to play in it. During that time, my aunt and I were filling up every glass and bottle, as well as the bathtub, in case we lost water – which we did within the hour. We had no power and no water for three days. We were very fortunate we had enough water, food, a propane tank for cooking, and blankets to stay warm.”
“We lost power the first day and so did all of my family in Houston – except my mom. So there were 14 of us packed into my mom’s house for three days. My daughter enjoyed playing in the snow, but we had to use an inflatable pool turtle as a sled because we don’t have sleds in Texas.”
EVP of Growth