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What caused the power failure in Texas during its extreme weather event, how an independent grid contributed, and what the state can do to mitigate the impacts of extreme weather

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Sascha Medina's picture
Cleantech Intern UNC Institute for the Environment Cleantech Corner

Sascha Medina is a recent graduate from the University of North Carolina at Chapel Hill. She graduated in 2021 with a B.S. in Environmental Science. She has been a Cleantech Intern at the UNC...

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  • May 26, 2021 5:35 am GMT
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This item is part of the Special Issue - 2021 - 05 - Grid Modernization, click here for more

America’s famously known independent Southern state, Texas, was hit by a major cold weather event in February causing millions to lose power. At first, the snow and its layering of white sparked feelings of excitement, but those shed quickly as energy depletions caused rolling blackouts into prolonged blackouts, pipe bursts, and freezing homes. For days, the temperature was in the low teens, water supplies were turned off, and boiling advisories were issued. All said and done, the devastating weather event resulted in the deaths of at least 138 people and became one of the costliest weather events in history. The cost of the damages are not yet certain, but they already exceed $10 billion. As the nation reflects on the event and results, questions arise about how and why this happened and attention is drawn to the state’s energy grid and operating system.

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What happened in Texas?

The power failure was a result of cumulative factors including resource inadequacy, the non-winterization of equipment, and the role Texas’s deregulated and independent grid played. Because of the long duration of extreme cold weather, the demand on the electric grid increased dramatically. The demand exceeded what the Electric Reliability Council of Texas (ERCOT) expected, the electric system operator in Texas. Each season ERCOT produces the Seasonal Assessment of Resource Adequacy and predicts the expected peak demand to ensure there will be enough available electric generation. Gary Rackliffe, Vice President of Market Development and Innovation at Hitachi ABB Power Grids, said the expected peak demand that occurred exceeded what ERCOT expected and the electric generation was less than what they assumed to be the worst-case scenario. As a result, there was insufficient electric generation to match the demand during this extreme weather event. Jonas Monast, Assistant Professor & C. Boyden Gray Distinguished Fellow at UNC School of Law, also explained there was too much demand on the grid due to the increased use of heating, and there weren't enough power plants able to operate in the freezing temperatures Texas experienced.

During this event, one factor that led to insufficient power supply to be able to meet the demand was an issue of resource adequacy. During the peak demand about 46 gigawatts of electricity total were offline; about 28 gigawatts being thermal resources including natural gas, coal, and nuclear and about 18 gigawatts being renewable resources, mostly wind. Rackliffe said before the event, about 15 gigawatts of wind generation was already offline.

Experts have concluded natural gas failure is the main cause of this extreme weather event but at the outset, renewable energy production such as wind and solar were blamed. However, subsequent findings revealed that fossil fuels such as coal, natural gas, and nuclear lost twice as much power than renewable sources such as wind and solar, which actually only accounted for 13 percent of the total power outages.

Because of the state’s heavy reliance on natural gas for power and heating during times of high demand, its shortage had a much more significant impact than the shortage of wind energy. “The unavailable wind obviously contributed to the problem. But ERCOT was not really expecting to have much available during that time period,” Rackliffe said. “So, the fact that some wind generation was not available wasn't as significant of an impact as the natural gas they were expecting to have available.”

While all power generation supplies were affected, natural gas had the largest impact, and experts have analyzed why there was a shortage in generation. One reason is because power generation in Texas is not winterized, meaning power generation was not specifically prepared to work in extremely cold temperatures. Jennifer Chen, President at ReGrid and Senior Policy Counsel at CO2EFFICIENT, said she and a lot of experts agree the power outages were not because of a resource adequacy issue, but rather a performance issue. “It’s more about cost-effectively ensuring that wellheads, pipelines, and power plants actually function under cold conditions,” she said. Rackliffe said as the temperature dropped, equipment at some of the major coal, nuclear power, and natural gas plants froze over, resulting in the unavailable generation. If the plants were winterized to be able to withstand the physical impacts due to freezing temperatures, power failure may have been avoided. Additionally, renewable energy generation such as wind energy can operate in extremely cold weather if they are winterized, but in this case they weren’t.

Furthermore, this event raised questions about the balance between using a scarce resource for different critical functions. While home heating is a critical function that is often reliant on natural gas, so is ensuring that natural gas wellheads have enough power to continue producing natural gas. Chen explained the source of the natural gas shortage was due to inadequately optimizing natural gas use, whether through more transparent natural gas markets or through designating critical facilities during emergencies. In other words, part of  the problem was a result of not having a way to direct gas to its most valuable use in times of scarcity. She said to approach this problem, getting a better understanding of the value of the natural gas and figuring out a way to better allocate gas so that it’s being used the most optimally will be beneficial.

Because Texas was experiencing all of these cumulative factors that resulted in insufficient power supply, to make sure the integrity of the electric grid was maintained, rolling blackouts were initiated to reduce the demand on the grid to a level where ERCOT could balance the demand with the generation that was still available, Rackliffe explained.  In some cases, rolling blackouts became prolonged outages if the utility did not have enough circuits without critical loads to meet the needed demand reduction. The prolonged blackouts and other outages due to storm damage caused problems with freezing and bursting pipes, devastating people and businesses across the state. This means customers experienced two dynamics, rolling blackouts and prolonged outages.

Texas’s independent grid & how it contributed to the impacts of the extreme weather event

Many Texans and people across the nation wonder if the state could have somehow mitigated the devastating results of the extreme weather event. One rising question of importance is whether or not Texas could have imported power to meet the increased demand. There are three electric grids in the United States, the Eastern and Western interconnects, and Texas’s managed by ERCOT.  Rackliffe explained the three interconnections are asynchronous and require HVDC (high-voltage direct-current) ties to move power across the interconnection boundaries. Texas’s electric grid is largely independent, and mostly disconnected from the Eastern and Western interconnects, so there is not significant capacity for transmitting power into and out of Texas.

Texas’s first independent operating system was formed in the 1930s after President Franklin D. Roosevelt signed the Federal Power Act, which charged the Federal Power Commission with regulating interstate electricity sales. This is because the Constitution of the United States gives the federal government a right to regulate interstate commerce. Monast said Texas’s grid is isolated due to the fact that the state does not want to be subject to federal electricity oversight. He said the state is able to avoid some federal regulations and standards under this type of independent operating system. The state’s long-time value of independence and distrust of the federal government are the primary reasons why it’s grid is independent. But this weather event could be the final push needed for the state to create stronger interconnections between the grids.

In addition to wanting to be independent, Monast explained Texas prefers to be reliant on market choices rather than direct regulatory choices. He said because the state follows this philosophy, operators and owners of power plants did not invest in making the power plants resilient to cold weather because extreme weather happens so infrequently, with the last such event taking place in 2011. Since there was not a regulatory mandate to do so the market prices didn’t reward Texas for making that kind of investment, he explained. This weather event showed the consequences of relying on this type of philosophy. In contrast, Chen shared regulators in Texas can require weatherization without reverting the market structure to a fully regulated system.

Monast said if Texas’s grid were to become more connected and the state opted into a broad regional grid, it could result in less independence for the state in overseeing its electricity sector. Industry experts continue to debate Texas’s ability to interconnect it's grid and the longterm state and federal policy impacts resulting from that as the decision to do so opens up the possibility for new state and federal regulations. Although regulators are not considering proposals to connect the Texas grid to other states, there could be some benefits for doing so.

Benefits of grid connectivity

Experts say if there was an ability to import power through grid interconnections with the Eastern and Western interconnections, the extent of damages resulting from the extreme weather event in Texas could have been reduced. Large capacity interconnections between the grids would allow power to move back and forth, potentially alleviating the demand for power on Texas’s grid as it skyrocketed during the extreme weather event.

Furthermore, grid connectivity provides a plethora of benefits. Rackliffe explained in a general sense, grid connectivity strengthens operational flexibility and resiliency as the overall operations of the grid become more reliable and substantial amounts of power can begin to move between the interconnections. Chen explained grid connectivity is beneficial because the energy portfolio becomes more diversified.

Grid connectivity can also accommodate higher levels of renewables. A preliminary cost-benefit study conducted by the National Renewable Energy Lab, a laboratory of the Department of Energy, found there were substantial positive cost-benefit ratios for increasing transmission capability between the interconnections. Rackliffe explained location of renewable resources and timing, when these resources are available relative to electricity demand, are large challenges. Renewable energy must be used at the location where it is produced, stored, or moved to a location where it is needed to meet electricity demand, which requires transmission capacity. If none of those can be met, the last option is to curtail it, and it becomes “spilled kilowatt hours,” which means the energy is lost forever. Increased investment in transmission, or ability to move renewable generation to address the location and timing challenges, can help with this problem. The study found cost-benefit ratios can reach as high as 2.9, meaning for every dollar that is spent in transmission, an economic payback of up to $2.90 is created. Rackliffe said by increasing transmission capacity, operational flexibility and grid resiliency are also  improved. 

Several initiatives demonstrate the need and benefit of investing in grid transmission. The American Council on Renewable Energy’s (ACORE) Macro Grid Initiative recommends expanding and upgrading the nation’s transmission network. The initiative outlines the need for investment in transmission to help facilitate the development of renewables and help meet the nation’s renewable use and carbon reduction goals. Rackliffe said to achieve 100 percent carbon-free generation by 2050, there will need to be more investment in renewable generation like solar and wind.  To accommodate these higher levels of variable renewable generation, the grid is going to need the flexibility and resiliency that additional transmission investment will provide.

Grid connectivity can also provide Texas with an economic benefit. Monast said Texas has the potential to generate a lot more wind and solar energy than it already does, and can sell it to other parts of the country if they could transport the power there. But currently, they don’t have a way to get that power to the market, he explained. Grid connectivity would allow Texas to transmit that power and reap the economic benefits of producing and selling more renewable energy. But Monast explained the wind generators in Texas are currently designed to only meet the needs of Texas.

Other solutions to mitigate impact of extreme weather events

Besides winterization, cost-effective measures to optimize resources, and grid connectivity, there are several other routes to help prevent and mitigate the impacts of extreme weather events in the future. Monast explained investing in additional power plants ready to run in events like this would have helped avoid the situation Texans experienced. This would mean charging ratepayers slightly more to compensate power plant operators for maintaining additional power plants ready to run even if they’re not selling electricity. In contrast, Chen said building more plants doesn’t guarantee they will run in cold weather, same with wellheads and pipelines. “There were sufficient power plants, but they didn’t perform,” she said.

Monast said greater investment in microgrids could help as well. Microgrids are localized grids that are not dependent on the large integrated system and can disconnect from the traditional grid and function autonomously, if needed. The Department of Energy claims microgrids can help advance the nation’s energy system as they increase resiliency and help mitigate disruptions.

Chen also suggests events like this need to be better forecasted and steps should be taken to equip customers with ways to manage electricity during times of scarcity. She said because the event was not well forecasted Texans were not nearly prepared enough. Providing customers with the information they need to prepare for blackouts can help mitigate the impacts many Texans experienced. “We have to think about all the various ways we can enable the demand side to be prepared and that we’re able to get the forecast information they need in a timely way,” she said.

Chen also noted to increase resiliency, customers and energy providers should think about what resources they’re relying on today and whether or not that resource mix is going to change. As the availability of different types of energy evolves, how energy providers maintain reliability should also evolve. She explained investing in other types of energy resources that are less vulnerable to issues such as fuel transportation during crises will help increase energy reliability.

Conclusion

As this event was investigated, Texan lawmakers and policy makers proposed new legislation that could help mitigate events like this or even more severe events from occurring in the future. But Monast said “in Texas, cold winter cells are one of the biggest challenges with clean energy policy.” During these times, Texas typically can’t rely on solar or wind energy, making a significant amount of the generation available during other times unavailable during extreme cold weather events. Texas must analyze all possible options and solutions including a mix of renewable and traditional sources they can implement to simultaneously further clean energy initiatives and mitigate impacts of extreme weather events.

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Matt Chester's picture
Matt Chester on May 26, 2021

Monast said if Texas’s grid were to become more connected and the state opted into a broad regional grid, it could result in less independence for the state in overseeing its electricity sector. 

Can you expand on what the real negatives of being less independent are? It's not terribly surprising that Texas is the state that prioritizes self-sufficiency and the idea of independence, but in a practical day-to-day standpoint, what is that getting them? 

Vince Green's picture
Vince Green on Jun 3, 2021

Sadly, the deaths of at least 138 people and over $10 billion in damages.  The damages still may happened due to the lack of winterization but likely not the power shortages and deaths, or at least not as many.

Matt Chester's picture
Matt Chester on Jun 3, 2021

Those are the damages of the status quo, right? The impact of being as independent as they've chosen to be to this point. I was asking about the other side of the coin: if being more interconnected could have prevented some of those serious impacts, then what are the reasons for avoiding further interconnection that are preserving the status quo? 

Rakesh  Sharma's picture
Rakesh Sharma on May 28, 2021

Thanks for a comprehensive piece detailing the Texas outage. It might be some time before we actually see real changes to the state's grid. Meanwhile, one of the things I liked about your piece is that you have included different viewpoints. Example: Monast vs Chen about adding new power plants to ensure grid resiliency. (Berkshire Hathaway Warren Buffett would be thrilled, if Texas added more power plants). I read an interesting piece (subscription required) about the same topic in WSJ today. Briefly, black start units, essentially standby generators to power the grid back to life in case of a disaster, in the grid stopped working and the grid came within five minutes of a complete collapse. The Texas outage seems to have been a system-wide failure orchestrated by ERCOT, whether it was negligence of infrastructure to power shutdown orders or the malfunctioning of black start units.

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