Texas power grid failure. Black swan event?

Power outage

Without electricity, everything stops. The Texas power grid is having huge problems keeping the power on in part because, although everything was winterized according to spec, the cold was “well beyond the design parameters of an extreme Texas winter”, plus it was state wide. In other words, their grid is failing.

And maybe the spec for winterizing was deliberately less than needed because upgrading it would have cost too much.

Natural gas pipelines froze, nuclear and coal plants went offline, in addition to wind turbines freezing up. (Credit where credit is due. Texas is a leader in wind power and has vastly more than any other state.)

All this was made much worse by the troglodyte grid in Texas which refuses to have power sharing agreements with other states. My god, they weren’t going to let no damn federal gummit interfere with their electricity! So their grid is within the state only, so less subject to federal regulation. It also means they can’t import power from other states if they need it. No other state is this belligerently stupid.

“The ERCOT grid has collapsed in exactly the same manner as the old Soviet Union,” said Hirs. “It limped along on underinvestment and neglect until it finally broke under predictable circumstances.”

Utilities also have systemic problems. They have to sell power at cost, however can make a stable return by building new stuff.

There is one key fact about utilities that average people need to know in order to understand their current dysfunction.

It is this: US power utilities almost universally operate under what is called cost-of-service regulation (COSR). In a nutshell, they make money by building stuff.

Utilities have traditionally been guided by two values: reliability and low cost. Today, however, customers and regulators want more than just reliable power. They want lower carbon and air pollution; they want resilience and equity; they want consumer choice and local control. They want a fuller picture of the total societal value of power.

Doing so means non-infrastructure solutions like distributed energy and software and third parties who aggregate them. Utilities can’t make money off this. So, their business model conflicts with having a stable, resilient grid.

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