Texas’ utility incompetence brings havoc, steep price-tag, hundreds of miles North and South

Texas’ deep freeze didn’t just disrupt natural gas supplies throughout Lone Star country—its effects rippled across the country, extending as far north as Minnesota. There, gas utilities had to pay $800 million more than they anticipated during the event, and Minnesota regulators are furious.

“The ineptness and disregard for common-sense utility regulation in Texas makes my blood boil and keeps me up at night,” Katie Sieben, chairwoman of the Minnesota Public Utility Commission, told The Washington Post. “It is maddening and outrageous and completely inexcusable that Texas’s lack of sound utility regulation is having this impact on the rest of the country.”

The gas and electric markets in Texas are lightly regulated and highly competitive, which has pushed companies to deliver energy at the lowest possible cost. But it also means that many companies were ill-prepared when the mercury dropped. To save money, they had skimped on winterizing their equipment. As a result, gas lines across the state—which has about 23 percent of the country’s reserves—quite literally froze. The spot price of natural gas soared to 70-times what it would normally be in Minnesota, and gas utilities paid a hefty premium when they used the daily market to match demand.

Some places in this Land of Freedom … that slogan means local political hacks have all the freedom in the world to be dumb as a hoe handle.

2 thoughts on “Texas’ utility incompetence brings havoc, steep price-tag, hundreds of miles North and South

  1. Collateral damage says:

    Texas Enabled the Worst Carbon Monoxide Poisoning Catastrophe in Recent U.S. History https://www.propublica.org/article/texas-carbon-monoxide-poisoning
    At least 11 deaths have been confirmed and more than 1,400 people sought care at emergency rooms and urgent care clinics for carbon monoxide poisoning during the weeklong Texas outage, just 400 shy of the total for 2020. Children made up 42% of the cases. The totals don’t include residents who were poisoned but did not seek care or those who were treated at hospitals and urgent care clinics that do not voluntarily report data to the state.
    Black, Hispanic and Asian Texans suffered a disproportionate share of the carbon monoxide poisonings, ProPublica, The Texas Tribune and NBC News found based on a review of statewide hospital data. Those groups accounted for 72% of the poisonings, far more than their 57% share of the state’s population.
    Lawmakers introduced a slew of bills aimed at overhauling the state’s electric grid after the storm, which had its most devastating effects from Feb. 14-17. Temperatures plunged into the single digits, nearly 4.5 million Texas homes and businesses lost power at the peak of the storm, and more than 150 people died, many of them frozen in their homes. https://www.dshs.state.tx.us/news/updates.shtm#wn

  2. Simon Legree says:

    Natural gas customers in Texas get stuck with $3.4 billion cold-snap surcharge https://arstechnica.com/tech-policy/2021/11/natural-gas-customers-in-texas-get-stuck-with-3-4-billion-cold-snap-surcharge/
    Texans will be paying for the effects of last February’s cold snap for decades to come, as the state’s oil and gas regulator approved a plan for natural gas utilities to recover $3.4 billion in debt they incurred during the storm.
    The regulator, the Railroad Commission, is allowing utilities to issue bonds to cover the debt. As a result, ratepayers could see an increase in their bills for the next 30 years.
    During the winter storm, natural gas prices spiked as cold temperatures drove demand up while also depressing supply. Much of Texas’ natural gas comes from fracking, which uses large amounts of water. To prevent the wellheads from freezing, many producers shut-in their wells [link] in advance of the storm. The governor’s office knew of the looming shortages days before they happened, yet the preparations they made did little to alter the course of the disaster. https://arstechnica.com/tech-policy/2021/05/texas-gov-knew-of-natural-gas-shortages-days-before-blackout-blamed-wind-anyway/

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