The catastrophic winter storm that hit Texas this week has left millions without power, heat, or water. While the storm and its effects are not fully behind us, Texas residents are rightly seeking answers to why power outages have been so widespread and prolonged, and who is responsible.
Sadly, but predictably, opponents of renewable energy have taken to the media to pin the blame on wind energy. “This is what happens when you replace fossil fuels with wind,” is how the narrative goes. In fact, many wind turbines were forced offline due to the cold. Ice forms on untreated turbine blades, preventing them from catching the wind, until they ultimately stop moving. That acknowledgement misses all the key lessons from this tragic event, however, which fact-checkers have been quick to point out.
First, wind generation makes up only a small fraction of Texas’ power generation capacity. As the Texas Tribune notes, only 7%, or 6,000 megawatts of generation is expected to come from wind during times of peak power consumption. Hourly tallies from ERCOT, the Texas grid operator, show that wind produced between 4,415 and 8,087 megawatts during peak times of the crisis, well in line with expectations.
It was conventional sources of generation, most notably natural gas-fired plants, that were relied upon to deliver and which failed spectacularly. These conventional plants, including coal and nuclear, are responsible for 80% of wintertime capacity, or 67,000 megawatts. Of that total commitment, 30,000 megawatts were forced offline due to frozen instruments and non-functional gas pipelines. Natural gas is stored underground in Texas, and cold weather prevented it from being pumped to generators as fuel, as well as to residential and commercial consumers who require it for heating. It was the successive failure of these conventional plants as the cold settled in on Sunday night that forced ERCOT to begin cutting power to customers.
The fact is, the Texas generator fleet was not prepared for a winter storm like this. Wind turbines, convention plants, and gas infrastructure alike were not properly weatherized to withstand the cold. As U.S. Representative Dan Crenshaw, R-Houston, a renewables opponent, acknowledged, “We didn’t run out of natural gas, but we ran out of the ability to get natural gas. Pipelines in Texas don’t use cold insulation—so things were freezing.” We have seen this before. In the Polar Vortex that struck the Northeast in 2014, coal piles froze and natural gas fuel ran out, and in the 2019 Polar Vortex coal and gas-fired were again the main casualties, this time due to mechanical failures.
Wind turbines, far from being fair-weather resources, today operate in the arctic in temperatures down to -22 degrees Fahrenheit. Modern turbines can be weatherized for only a 5% increase in cost, but this feature was not available when much of Texas’ fleet was built. Retrofits are the only option, which can be much more expensive.
So why was the Texas fleet not prepared? Some have been quick to blame the state’s deregulation of the electricity sector, which split power generation from transmission and retail sales, so specialized companies could step in and compete. Lack of regulation, the argument goes, has permitted generators to be irresponsible and not weatherize like they should.
But ERCOT takes a market-based approach, which employs a carrot as well as a stick—and they are both big. Whenever there is not enough power supply to meet demand, ERCOT ratchets up the price of electricity by a factor of over two hundred, from around $40 per megawatt-hour to $9,000. That means that generators who are prepared and can deliver reap a tremendous windfall, rewarding their investment made in resilience. Those who cannot deliver not only miss out on the windfall, but likely have to pay the $9,000 price to a counterparty that they have an obligation to, incurring huge losses. For a modest 10-megawatt generator frozen over two days, those losses would come to a staggering $4,320,000, enough to bankrupt its owner.
The key takeaway from this tragic event is that the owners of Texas’ generator fleet discounted just how devastating the effects of climate change can be, and many of them will pay a huge price for it. The silver lining is that they and other investors can learn from their mistake, harden existing infrastructure and invest in new, resilient infrastructure in the future. We also cannot forget that the pollution emitted by fossil-based resources is one of the reasons we face such extreme weather in the first place. Investing in clean, renewable wind and solar resources is the most responsible choice.
Dr. Ben Hertz-Shargel
Head of Data Science and Demand Management, Rhythm