February 24, 2021

The Lone Star will not always shine if disconnected from the national grid

After the American Century


The Texas Blackout reveals the state's ambivalence toward the rest of the US. 

Texas liked to think of itself as a separate place, almost a country in itself. It is called the "lone start state" suggesting it can and will stand alone. Historically speaking, Texas was briefly a country that declared its independence of Mexico and then joined the US. It is the only state that ever came into the union in that way. 

These facts are related to the electrical blackout that it is now recovering from. Because Texas has been the only state to reject being a part of the national electrical grid. Instead, Texas electricity is regulated by the Electric Reliability Council of Texas (ERCOT). Joining would mean that Texas would begin to buy and sell electricity across state lines, for example with Oklahoma or New Mexico. As soon as one engages in such interstate commerce, one becomes subject to regulation from Washington. As the Constitution puts it in Article 1, section 8, Congress has the power "to regulate commerce with foreign nations, and among the several states."   

Why did Texas wish to escape regulation? Because regulation means that profits cease to be the only consideration for energy companies. The production and transmission of energy is costly in itself, but Federal regulations demand that the technologies involved meet a high standard. Take Texas gas lines as an example. There are gas lines all over the United States, and those that are federally regulated must be well-insulated and meet other quality control standards. Texas state regulators knew that their gas lines could freeze and cease to function if it got cold enough, and indeed they were told about the problem in 2011 when they did seize up under a shorter cold snap. Windmills in Minnesota or Massachusetts seldom freeze up in the winter, but they did in Texas because it was cheaper not to weatherize them.

Why multiply examples? Texas energy companies did not need to invest in the best available technologies, because state regulators put profits ahead of performance safety.  And because the energy market in Texas is competitive, it would be startling if one or another company spent more money than legally necessary to produce and transmit electricity or gas, because that would put them at a disadvantage in the marketplace. 

Imagine if the same thing were true for automobiles. If Texas automobiles cost less because they had brakes that did not work well in cold weather, would that be a good idea? 

So what happens now? The citizens of Texas are suffering cold, water shortages from broken pipes, and much else. Fortunately, the Texas energy companies have saved up several billion dollars over the years and they are going to pay for all the damages. Wrong. They have not saved, and suddenly Texas feels it is definitely a part of the United States. They have asked for, and received a Federal bailout.  President Biden is sending 60 electricity generators, food, water, blankets, and meals to Texas. 

Strictly speaking, however, it would be only fair if Texas were told that no Federal funds would be handed out unless its utilities agreed to bring their technologies up to the national standard, and to have systems of reserve production like the rest of the country. Then Texas blackouts would be less frequent and less severe. But of course, this would be an inhumane thing to do, with 13 million Texans lacking water. So, Texas just became a big-time recipient of welfare. (So much for all the blustering and posturing about state's rights. The fact of the matter is that the so-called Red states, including Texas receive enormous sums every year from the Federal government, while the Blue states pay more in taxes than they get back. But that is the subject for another blog.)

There is a reason the US has a national gird - because like the states, energy systems are stronger if they work together. An electrical grid allows companies to trade electricity extremely quickly, because it moves at about the speed of light. If Chicago or Philadelphia needs more electricity, it can buy it from other systems on the same grid. If Houston or Dallas lacks power, however, they can only get it from within Texas. The Lone Star will not always shine, given the lack of a grid. 

Electricity has become too important to pretend that a state can go it alone without incurring massive problems. Hospitals need to keep those electrons flowing. Factories cannot function without it. Families, churches, pretty much everyone and everything needs electricity. When the lights go out, it is a universal crisis.

For a social history of blackouts, have a look at When the Lights Went Out: A History of Blackouts