Texas conservative Sen. Ted Cruz said his home state should consider reforms to its famously free market electricity system after the power grid failed to withstand extreme winter weather. It caused nearly half of its power plant capacity to fall offline and left more than 4 million in the dark for days.
“Texans are frustrated and angry that the energy capital of the world couldn’t keep our lights on and heat in our homes,” Cruz told the Washington Examiner in a recent interview. “It’s embarrassing and infuriating. We need to make sure that it never happens again.”
Cruz said Texas should consider mandating that power plant operators and oil and gas producers invest in potentially costly upgrades to protect their facilities and equipment from cold weather. The state previously declined federal regulators’ recommendations to impose mandates after a similar, less severe cold weather event in 2011. Texas Gov. Greg Abbott, a Republican, has called on state lawmakers to make the winterization of power plants mandatory.
“That is certainly a possible outcome,” Cruz said of the potential for the Texas legislature to impose mandates. “We need a reasonable cost-benefit analysis of what measures need to be taken to ensure reliability. A market system that is able to produce good results and affordable energy in ordinary times is not necessarily suited to a crisis situation.”
As Congress, federal regulators, and state officials conduct a post-mortem, Cruz said he’s eager to participate in a serious conversation after he drew national ridicule for his decision to flee the storm for Cancun.
He criticized fellow Republicans for blaming frozen wind turbines as the leading cause of the outages, but he also said Democrats have been too eager to attack fossil fuels.
“There are some who have quickly fallen into political talking points, blaming the Green New Deal, and saying the fault is entirely that of wind and solar, and there are others blaming natural gas and coal and asserting wind and solar bore none of the responsibility. The truth is somewhere in the middle,” Cruz said.
Cruz even suggested he was proud that Texas has the most installed wind capacity of any state, a status achieved without a mandate for clean electricity. Texas does not rely as much on wind in the winter.
“Texas leads the nation in wind despite all the hot air from California politicians,” Cruz said. “An all-of-the-above approach to energy is a strength to Texas. We have diverse energy sources competing to provide low-cost energy.”
Cruz said the problem is not a fuel source issue. While natural gas, Texas’s largest electricity source, suffered the most problems, power facilities across all fuels, including coal, wind, and nuclear, went offline, forcing the state’s grid operator to order the most significant forced power outage in U.S. history. “The problem was not unique to wind,” Cruz said. “Natural gas electricity dropped significantly, and so did coal.”
The main issue is the Texas grid was built to handle the state’s hot and humid summers, when air conditioning use is high, and is ill-equipped to deal with unusually cold temperatures that caused energy demand in the state to spike to levels rarely seen during the winter months.
The Electric Reliability Council of Texas, the grid operator, does not have the authority to require power plants to make the type of upgrades to handle freezing temperatures common with power equipment in the Northeast and the Midwest.
Texas also has a unique power market structure that is designed to keep prices low but which critics say fails to incentivize power plants to pay for upgrades.
In addition, the Texas Railroad Commission, which regulates the oil and gas sector, does not have mandatory weatherization standards for the state’s producers. Natural gas production in Texas fell by almost 45% during the extreme cold weather, the Energy Information Administration reported Thursday, because of frozen wellheads and gathering lines.
Cruz said mandates for natural gas producers should also be on the table.
“I am confident the results of last week’s storm and the failure of the Texas grid mean there will be enhanced steps to weatherize production,” Cruz said. “I expect it will be a comprehensive solution, for production, power plants, and distribution.”
Other parts of the Texas system have also come under scrutiny.
In 1999, Texas broke up the traditional monopoly utility structure in favor of retail choice that allows customers to choose among hundreds of electricity providers who compete on price. But some of these providers offer plans that pass the varying cost of wholesale electricity prices directly to the retail customer, in contrast to plans that provide flatter rates throughout the year, meaning prices can skyrocket during emergencies.
Cruz criticized the practice, tweeting earlier this week that one case of a $5,000 electric bill was “WRONG” and warning that, “State and local regulators should act swiftly to prevent this injustice.”
“No energy company should enjoy a windfall because of a natural disaster, and Texas consumers should not pay dramatically higher rates because of utility failures because of this storm,” Cruz told the Washington Examiner.
The Texas Republican is less interested in changing another unique feature of his state’s power system. Most of the state operates as its own electricity island and is disconnected from the larger regional grids of the East and West, meaning Texas is unable to bring in power from other states to fill gaps in demand.
“I don’t think the answer should be to federalize the grid and impose so many mandates Texans end up paying California energy prices,” Cruz said, adding that he is sure the question of Texas interconnecting with other states “will be examined.”
Cruz is wary of overreacting to the storm, which he called a “once-in-a-century event,” and is skeptical of the role of climate change in making extreme weather events more frequent.
“It’s a mistake to base all your public policy on exceptionally rare disasters,” Cruz said.
But other Texas politicians are questioning whether their state should continue its go-it-alone approach and are calling for more federal oversight.
“I always believe in state rights, and I understand Texas’s spirit of independence, but there are certain things the federal government should require if we are going to have the second most populous state shut down,” Rep. Henry Cuellar, a centrist Democrat from Texas, told the Washington Examiner. “The power of our state should be connected to a national grid.”
