Saturday, March 13, 2021

Things are playing out in Texas (not improving, mind you, just playing out)


For those of you who haven’t been able to devote your life to following what’s happening in Texas in the wake of the Valentine’s Week Storm (my name for it, although there hasn’t been a lot of love lost so far), this article from UtilityDive helps you update your scorecard. To summarize for you:

·        The star of the article is Lt. Gov. Dan Patrick, who made a remarkable statement last April in regards to Covid: “there are more important things than living and that’s saving this country.” My guess is the 45,000 Texans who have died so far in the pandemic might disagree with him, but they’re currently unable to comment.

·        Not content to make light of the lives of his fellow Texans, he followed up that statement with one on Feb. 24 (on Fox News), making light of their loss of life savings: “We have in Texas, you can choose your energy plan and most people have a fixed rate. If they had a fixed rate per kilowatt-hour, their rates aren’t going up…. But the people who are getting those big bills are people who gambled on a very, very low rate…going forward, people need to read the fine print in those kinds of bills.”

·        My guess is that, unlike with the first statement, Patrick got a lot more pushback from the second one, because he seems to have experienced a remarkable (political deathbed?) conversion. As the UtilityDive article recounts, in a couple of weeks he’s changed from a cold-blooded defender of free markets into a wild-eyed consumer advocate, who’s pressing the lone remaining member of the Texas PUC to retroactively change the price of power during the week in question.

·        As the PUC member points out (actually, I should call him “the PUC”, since he’s all that’s left of it now), there’s only one problem with this request: there’s no legal basis for it. 

So that’s the current state of this crisis: Texas is caught between an immovable object and an irresistible force. The only outcome I can see is that ultimately the Texas citizens and ratepayers will bear some of the (perfectly legal) costs, and those that have paid the bills already will be only partially reimbursed, so they’ll share the costs as well. Nobody will be happy, but hopefully that will provide some momentum to fix the problems that led to this human and economic disaster.

Speaking of the economic problems, if you found this post interesting (or if you hated it and want to see me receive my comeuppance), you might enjoy the Energy Central conversation I’m having with Robert Borlick. He’s someone who obviously knows much more about the Texas power market than I do, and he wrote in to correct me on a few important points. I replied to him, and I’m hoping he’ll continue the conversation (I’ve been posting almost all of my blog posts on Energy Central since last August, and they’ve proven popular there, too. One difference with EC is I get a lot more comments – including long ones like Robert’s – there than I ever have on my blog. You can read me on either medium – I earn the same princely sum either way. Anyone can read any EC article and its comments, but if you want to comment on your own you have to be a member).

Any opinions expressed in this blog post are strictly mine and are not necessarily shared by any of the clients of Tom Alrich LLC. If you would like to comment on what you have read here, I would love to hear from you. Please email me at tom@tomalrich.com.

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