Comment by tw04
5 hours ago
The same Texas that has statewide power outages every time it gets below freezing (despite knowing for 25+ years it’s a problem) because of their lack of regulation and central planning?
Let’s not be anything like Texas.
5 hours ago
The same Texas that has statewide power outages every time it gets below freezing (despite knowing for 25+ years it’s a problem) because of their lack of regulation and central planning?
Let’s not be anything like Texas.
I would not entirely dismiss the way the power market works in Texas. I have not disagreement the 2021 storm should never have happened. At the same time though, I don’t believe other energy markets work very well either. I would prefer a more Texas like approach but with some thoughtfulness around capacity instead of just generation.
> I have not disagreement the 2021 storm should never have happened.
But they still haven’t fixed any of the issues. The exact same thing is going to happen again when (not if) it freezes.
> I would prefer a more Texas like approach but with some thoughtfulness around capacity instead of just generation.
Capacity isn’t the issue. Lack of winterization of pumps is the issue. Because that costs money and private companies have zero incentive to make the investment if government doesn’t force them to.
You are missing the forest for the trees.
Winterization is a fix for last time’s failure, not a strategy for the future. A market like Texas can work if it values resilience alongside price efficiency, meaning capacity planning, diversified generation, and yes, some enforced standards. Otherwise you’re just running a lean system that collapses the moment reality strays from the model.
That storm was an issue for other markets as well but they were mostly able to get away with rolling blackouts due to interconnects. Those same markets and similar winterization issues but were under FERC guidelines. Folks love to anchor onto to winterization issue like it did not impact other FERC regions.
3 replies →
> I don’t believe other energy markets work very well either.
but is isn't even about that storm, big "oh no" situations happen sooner or later (e.g. see energy outage in Spain) what is important is that you learn from it.
but more important in this argument is the general design, how can it handle flexible loads, how can it share loads between areas, how many ways to handle partial failure does it has etc.
and Texas is kinda not that good in all of that AFIK
the problem is that there are markets where politics fully getting "out of the way", doesn't work as the market dynamics favor things which might be better for the people running the gird, but are bad on a state economical level anyway (but getting in the way here is using tax money to make sure the net is stable, not getting int the way of that to protect personal investments)
it's a bit like freighttrains in many parts of the EU, there operating does in most situation make no profit. But having them is helping the economy as a whole and can (implicitly) safe the state/region etc. money. So it makes sense to place some tax money into making them still viable to operate as that investment in a roundabout way saves more money then spend.
I agree that the ability to adapt, whether to flexible loads, partial failures, or cross-area balancing, is the real test of a grid design. Texas’s isolation means it inherently lacks some of the tools SPP or MISO can use, which makes resilience harder. That is not a “market” problem so much as a structural one. ERCOT’s ruleset was built to optimize for low-cost generation in-state, not multi-region contingency planning.
Where I think a Texas-like market could work better is if you layered competitive generation with enforceable capacity and resiliency standards, along with some interconnection flexibility. Right now, the market rewards generators for selling MWh in good weather, not for being ready in bad weather. That is the economic misalignment.
The EU freight analogy works in the sense that reliability is often a public-good investment. No private actor has the incentive to overbuild or maintain resources for rare events. Texas’s approach does not have to mean politics fully getting out of the way. It could mean using market signals to keep prices efficient while still mandating the backup, winterization, and grid-sharing capabilities that the economy needs.
This just shows how you know only the talking points. The power outages are not due to lack of central planning, it's very explicitly the reverse. If Texas were hooked up to the rest of the country, those outages would not be a thing. It's the purposeful regulation that has caused those problems.
I guess you’re saying that the current status is mandated by the design of the grid. Which is true, but that status would be best described as “deregulated” rather than “purposeful regulation.”
Lack of regulation and oversite around weatherization and redundancy is the main source of our problems. The Texas’ grid is market based and so unregulated that it’s not connected to the national grid so it can avoid federal regulation.
I recommend this podcast to anyone interested https://kutkutx.studio/category/the-disconnect-power-politic.... I learned that our current Texas grid was designed by Enron.
Every single state surrounding Texas was also suffering from power outages due to the winter storm in 2021, despite all of those states being part of the non-Texas interconnections. The outages in those states weren’t as bad, but even if Texas was better connected to them, there’s no guarantee that they would have had any power to share.
So you're saying when the Texas grid fails, it's because of over overegulation. But the solution to those failures is to tap into the national grid, a grid that follows stricter FERC regulations.
This argument doesn't make any sense.
No, I'm saying it's because of _poor_ overegulation.
> The power outages are not due to lack of central planning
It is 100% due to lack of central planning. The outages were caused by a lack of winterizarion of natural gas pumps which was a known issue in Texas but the lack of regulation meant companies could just ignore the problem. Why invest in winterizing when you can just jack up prices and make even more money when they freeze and there’s not enough power to meet demand?
There’s a reason the power doesn’t go out in the winter anywhere else in the country when it gets below freezing and it’s not “a lack of regulation”.
Winterization was a problem but it was also a problem for other regions that are part of FERC. You’re latching onto the wrong problem. FERC has updated guidelines since that storm.
I'm a Californian in PG&E territory. My power is unreliable and expensive. I'd take the Texas outcome every time.