Grid Locked

Roman Mars:
This is 99% Invisible. I’m Roman Mars.

[MUSIC]

Roman Mars:
A little more than a year ago, in February of 2021, it was snowing in Austin, Texas. Which is… unusual.

AUDIO TAPE OF MOSE BUCHELE / START OF BLACKOUT:
So this is the beginning of what might be a historic winter storm here in Austin. (laughs) I love this…

Mose Buchele:
I mean I was psyched. It was snowing, like really snowing… in Austin! And that just doesn’t happen much here.

Roman Mars:
Mose Buchele is a reporter at KUT, the local public radio station in Austin, TX.

Mose Buchele:
You know, I wanted to get out and document the storm as much as I could. But then there’s this moment in the tape that still gives me chills when I listen back to it.

AUDIO TAPE OF MOSE BUCHELE / START OF BLACKOUT:
A big question for a lot of people right now is whether the electric grid is going to hold up…

[MUSIC]

Roman Mars:
If you remember the news from Texas… the grid did not hold up. It went down pretty much all over the state. Millions lost power for days, some in houses not built to withstand freezing temperatures. According to at least one estimate, more than 800 people died.

[ARCHIVAL NEWS TAPE]

Woman 1: I’m so (beep) heated y’all. Greg Abbott, what the (beep) are you going to do about this power grid?

Man: You see all these headlights, you see all these people? These are people that have had no electricity for 13 hours and they don’t have anywhere else to go.

Woman 2: Day five… (flips switch)…nothing.

[MUSIC FADES]

Roman Mars:
Mose has been covering energy in Texas for more than a decade. He reported on the whole blackout catastrophe with his colleagues at KUT and they made a great podcast out of that reporting called “The Disconnect.” And today on our show, we wanted to talk with Mose about what exactly happened a year ago – and how it connects to the strange history of the Texas power grid.

Mose Buchele:
So a few days after the blackout ended, we started talking about making a podcast just to explain what happened. Because people really didn’t understand! I was hearing all these questions about how the Texas power grid, how it works and how something so catastrophic could happen in a state that is literally known for its energy industry – it’s baked into the entire persona of the state.

Roman Mars:
Right, I know Texas is huge when it comes to oil production, but can you give us a sense of just how big oil production is?

Mose Buchele:
Okay, to give you a sense of the scale: about 15% of the entire world’s oil is produced in the United States. And almost half of that is produced right here in Texas.

Roman Mars:
That’s a lot.

Mose Buchele:
But it’s not just oil. A lot of people don’t know this but Texas is also the number one producer of wind in the country. We’re number one in gas, too. Not to mention solar, nuclear, coal… all of that makes what I’m about to say next really surprising. The Texas energy grid for decades… has operated on this knife’s edge. I mean, in the few months after the last blackout, there were two more times Texans were warned there might not be enough electricity to go around. Two!

Roman Mars:
So if you had to sum it up…. WHY? Why is the Texas grid so fragile? Why is it on this knife’s edge?

Mose Buchele:
That’s a big question. To answer it, you really have to look at the history of the grid and how Texas came to be what we call an “energy island.” It’s the only state in the lower 48 that operates its own independent electric grid.

Roman Mars:
Okay, so let’s get to that history.

Mose Buchele:
We’re going to start right at the very beginning – right when electricity comes out. And at first it’s kind of a novelty. But then, people start to have it in their houses. Cities, especially, started using it to power street lights, maybe street cars. And as electricity use expands, there was this hodgepodge mix of ways you could get it, like utilities. There were some utilities that were run by cities and towns and then there were these independent outfits – private operators. In the beginning people could just buy a kit, like you’d get an electric generator and you set up shop and you just start trying to compete for customers.

Roman Mars:
So it’s kind of like the wild west.

Mose Buchele:
Yeah it was very unregulated. But all of that starts to change as it becomes more of a necessity.

Julie Cohn:
Starting in 1907 states began to regulate power companies.

Mose Buchele:
This is Julie Cohn, she wrote a book about the history of power in the US. It’s called “The Grid.”

Julie Cohn:
They said, you know, this is becoming an essential service. We want to make sure that it’s provided on a fair basis to the citizens of our state so we will say who can operate where and how much you can charge your customers for your electric service. And you in return will promise us that you will be fair in how you provide electricity to your customers and it’ll be reliable.

Mose Buchele:
This regulation she’s talking about, it was happening in most states, like the state was regulating electricity… but not in Texas.

Roman Mars:
I can’t say I’m surprised.

Mose Buchele:
Right. Texas was anti-regulation, even back then. So the oversight of our power companies here remained pretty light. But as the grid grew elsewhere in the country, and especially as it started crossing state lines, regulation became a bigger issue.

Roman Mars:
Because then it becomes a national issue. Because then it becomes the purview of the federal government if it goes across the state.

Mose Buchele:
Yes it does. And it really changed in a big way when this guy became president.

ARCHIVAL TAPE / FDR:
Let me assert my firm belief, that the only thing we have to fear is fear itself.

Mose Buchele:
This guy is FDR, of course.

ARCHIVAL TAPE / FDR:
This nation is asking for action and action now. (applause)

Mose Buchele:
So this was the New Deal era. FDR was going after monopoly powers all over the place, and these big electric companies were among his main targets. They had become increasingly monopolistic as all these discrete local grids grew into each other and became more of these bigger kind of regional entities. And FDR wanted to check that power. Especially to make sure ratepayers didn’t get a raw deal. So Congress passed a law in 1935 that said if you cross state lines, you’re going to be under the regulation of the Feds.

Roman Mars:
And the key phrase there that I’m hearing is “cross state lines.” It sounds like you could get around federal regulation if these companies didn’t cross state lines.

Mose Buchele:
Exactly. And that is what happened in Texas.

Julie Cohn:
You can imagine why it was very attractive to these Texas power companies to say, Okay, forget it. We’re not going to sell power to anybody in Louisiana or Oklahoma or whatever. We’re just going to form interconnected systems inside Texas and operate as we wish.

Mose Buchele:
I think it’s interesting to note that at first, Texas was not alone in this. Some other utilities stayed within state lines too. Maine had no interconnections, for example. But by the 1960s, Texas was the only state left in the contiguous United States with its own grid. And part of the reason why has to do with Texas’ size.

Julie Cohn:
Texas, as everyone who lives in Texas knows, is a really big state. And not only are we big, but we’re wide. We have two time zones, so the sun rises an hour later in West Texas than it does in East Texas.

Mose Buchele:
So Texas’ width, it means not everybody needs energy at the same time. People in East Texas wake up, drink their coffee, turn on their air conditioning, and then gradually – an hour later – people in West Texas do the same thing.

Roman Mars:
That is amazing to me, that the reason why this holds together is just the geography of the state. So energy demand moves slowly across the state because it’s so wide. And that means the grid typically doesn’t get overloaded… no one turning on their coffee machines all at once across a gigantic state.

Mose Buchele:
Right, we can roll that power around. And there’s also weather to think about. Electricity is needed more when there’s extreme weather. But Texas is so big there’s really hardly ever a moment when there’s the same weather all across the state. So that really lets you move the power around to where it’s needed. And this is really important because having enough power to meet electric demand, that’s critical. That’s the name of the game. Otherwise the entire system trips up and you start seeing blackouts.

Roman Mars:
Maybe now we should talk about what is actually happening when a blackout happens. what is actually happening when a grid trips up and fails?

Mose Buchele:
Okay. So this is fun. I think the best way to explain this is to take you into a blackout. So I’m going to take a break from Texas history now and we’re going to jump ahead in time to 1965. In 1965 the northeast suffered one of the biggest power failures in U.S. history. And I’m going to play you the sound of that blackout.

ARCHIVAL BROADCAST TAPE / WABC:
Everyone’s Gone To The Moon (singing)

Roman Mars:
That doesn’t sound like a blackout. That sounds like a song. Why are you playing a song?

Mose Buchele:
This is “Everyone’s Gone To The Moon” by a guy named Jonathan King. This was a big hit in 1965. So on November 9th, this song was playing on a radio station in New York City, WABC, when the blackout hit. What we’re listening to is the tape of that broadcast.

ARCHIVAL BROADCAST TAPE / WABC:
Doesn’t that sound particularly slow to you? Everything sounds like it’s in slow motion here. I dunno what’s going on…

Mose Buchele:
So you can hear the music start to wobble around a bit at the end there. Sort of like its speed is changing. And that’s because of what’s happening to the electric grid. A lot of people don’t know this, but the grid has a beat. It’s 60 hertz or 60 cycles per second. This is the frequency that electricity runs over transmission lines. Almost everything electrical in your house is built to run on this 60 Hertz – your toaster, your TV. And at this radio station in New York, the turntables were synced to that frequency. So when the beat starts to slow on the grid, the DJ starts to notice it in the music.

ARCHIVAL BROADCAST TAPE / WABC:
That’s Lazy River in the key of R. Everything’s running at half speed including me (deep breath)…

Roman Mars:
God, I wish I could be that good of a DJ. He is on! It’s crazy. I love it.

Mose Buchele:
So this DJ doesn’t know it yet, but something has gone really, really wrong on the power grid around Niagara Falls that has caused a chain reaction which resulted in not enough electricity getting to New York City. So, when there’s less supply than there is demand, that imbalance… that can fry the whole system.

Roman Mars:
And you mean physically break the grid here? Like a physical reaction.

Mose Buchele:
Absolutely. I picture sparks flying, things literally shortening out, the very equipment starts breaking down. And that sort of damage, that can take weeks, maybe months to repair. So to stop that from happening, grid operators basically have two options: first, they can try to find more power somewhere to meet the amount of demand OR they start cutting people off to lower that demand. And that’s what happened in 1965 – they cut power to 30 million people.

Roman Mars:
Wow. 30 million people… did everyone just like freak out when that happened?

Mose Buchele:
Yeah they kind of did. That blackout, it made everyone take a look around and say, “We can’t let this happen again, okay?” So over the next few years, electric utilities started forming something called “reliability councils.” And these exist to basically keep that beat we were talking about… to keep that beat on the grid constant. So now, turning back to Texas. Texas is again, by this point, the only state in the lower 48 with its own grid, so it creates its own reliability council. It’s called the Electric Reliability Council of Texas. Here we just call it ERCOT.

[MUSIC]

Roman Mars:
And so how does ERCOT make sure that supply and demand are in balance?

Mose Buchele:
They do it by being the grid’s traffic cop. ERCOT basically tells the companies who generate power when and how much power they need to put on the grid to meet the amount of demand. Or if there’s more demand than there is supply, they can also order power companies to CUT service. This is what you call a planned blackout. It’s a tricky job and it became trickier later on during the oil crisis of the 1970s.

Roman Mars:
Right. This is the decade when the price for oil in the US skyrockets and we start seeing gas lines everywhere.

Mose Buchele:
And not only that, but Carter quite literally comes out and asks people to conserve energy domestically. If you’re cold in your house, don’t turn up the heat, just put a sweater on…

ARCHIVAL TAPE / JIMMY CARTER:
Many of these proposals will be unpopular. Some will cause you to put up with inconveniences and to make sacrifices. The most important thing about these proposals is that the alternative may be a national catastrophe.

Mose Buchele:
During this crisis, the Carter administration realized it needed to decrease the country’s dependence on foreign oil. And, part of how they went about incentivizing companies to produce more energy domestically was by deregulating the energy markets.

ARCHIVAL TAPE / JIMMY CARTER:
Through a new top level review process, we will do a better job of reducing government regulation that drives up cost and drives up prices.

Mose Buchele:
The idea was that deregulation would spur oil production in the US by encouraging investment. And at the same time, they argued, it would drive down energy prices by creating competition.

Roman Mars:
And so we’re seeing the baby steps of the philosophy of letting the market decide at the point.

Mose Buchele:
Right, and deregulation really gained steam in the 80s under Reagan. So by the 1990s, politicians were talking about deregulating the electricity market which, like we said, was always kind of run by monopolies. So, again, this is where Texas comes back into the picture. In the 1990s, deregulation came to Texas in a huge way.

[MUSIC]

David Sibley:
We got out a napkin and we kind of drew out the direction we thought it ought to take if we’re going to deregulate.

Mose Buchele:
So this is David Sibley, he was a state senator in Texas who led the effort to deregulate back in the 90s. Sibley and a few other legislators had this unique plan for Texas. He says they drew it up on this napkin, on the back of a napkin. But basically, it would let people and businesses choose where they’re getting their energy from. Like they could choose their power company.

Roman Mars:
So, what does that mean? What did David Sibley think that that would look like in practice? I can’t even imagine how you would do that… You have one wire going to your house. What does that mean to choose your electricity?

[MUSIC FADES]

Mose Buchele:
Yeah and it’s still not like this in parts of the country so I think it’s hard for people to wrap their heads around but basically under this bill, if you’re a consumer of electricity in Texas, you would get to buy your electricity the same way you’d buy a roll of toilet paper. You can go to the store and you look for whatever brand you like, you compare prices, and you pick whichever one you want, right? This isn’t the case in most of the US, like I said, where you still have your one utility that provides the energy to your town or city.

Roman Mars:
And I can imagine that these energy companies that had held these monopolies for decades at this point, were not a fan of the David Sibley plan, or him himself as a person.

Mose Buchele:
No, they were not because suddenly they wouldn’t be the only players in town.

David Sibley:
We had a private dinner with utility executives and told them what we were going to do and they were very, very opposed to our bill. They didn’t like it. They made it clear. It was very clear how much they opposed what we were doing. I mean, they were very opposed to it.

Roman Mars:
I think it’s safe to assume they were very opposed to it.

Mose Buchele:
I think they didn’t like the bill.

Roman Mars:
So who’s on the other side of this? Who wanted this? Who is David Sibley serving with this legislation?

Mose Buchele:
This is a fascinating coalition. Basically you had big manufacturers – factories, anything that consumes a ton of electricity, they’d rather be able to shop around and because they’re buying at such bulk, they can probably negotiate for better prices if the market is deregulated.

Roman Mars:
Right. That makes sense.

Mose Buchele:
Also, you had environmentalists really on-board with this in Texas. Environmentalists. Yeah, they wanted to deregulate.

Roman Mars:
That really surprises me. Because I don’t normally think of environmentalists as people who would prefer deregulated markets. So what was going on there?

Mose Buchele:
Back in the 90s, they saw deregulation kind of as an opportunity to break things up. If you imagine that you’re like an environmentalist in Dallas or Houston and you’ve been fighting some coal plant that you think has been polluting the country forever and you want to try to take it out, basically. Well, here comes an economic model that might suddenly give you the ability to do that. And maybe put more renewable energy on the grid. And they weren’t far off. They ended up writing in renewable energy goals into the bill so that when they deregulate, they start bringing in more wind power.

Roman Mars:
So Sibley’s bill had big manufacturers on board. They had environmentalists on board. And was it just good to go at that point?

Mose Buchele:
No. Well, we’re forgetting one other big key player in all this. And it’s a little company from Houston that you might have heard of before.

Alison Silverstein:
Enron was going around the country, trying to persuade all of these legislatures and policy makers that full tilt electric competition is a wonderful thing and here are all the benefits that it will bring.

Roman Mars:
Wow. Enron!

Mose Buchele:
Yes, Enron. This is Alison Silverstein who worked at the Public Utility Commission of Texas in the 90s while deregulation was happening. She, like lots of folks, doesn’t have a ton of great things to say about Enron.

Alison Silverstein:
Enron and other traders were able to develop a number of strategies that allowed them to make a ton of money in sleazy ways.

Roman Mars:
She doesn’t mince words!

Mose Buchele:
No, not at all. What she’s talking about here is… when she says Enron was “making money in sleazy ways.” Deregulating the energy market meant that companies like Enron can start trading energy basically kind of like a stock or a bond. And so around this time there’s this famous case on the west coast where Enron traders would straight up call a power plant and say, “Hey, can you shut down for maintenance?” And the power plant is like, “Why?” They’re just like, “Just do it.”

Roman Mars:
And so, what are they trying to accomplish when they do that?

Mose Buchele:
Basically, it’s market manipulation. The more scarce something is, the more valuable it becomes. So in this case, Enron used their influence to drive up the price of energy by making less of it available.

Roman Mars:
That’s like… diabolical.

Mose Buchele:
Yeah, that is.

Roman Mars:
But at this point, people weren’t aware of all the awful things Enron was doing, right?

Mose Buchele:
You’re absolutely right. And remember, Enron back then, Enron was wildly powerful. It was a corporate titan, like Amazon or Apple.

Roman Mars:
Yeah. Okay, so Enron is on-board with deregulation because they think it’ll open up another avenue for them to make money.

Mose Buchele:
Yep.

Roman Mars:
And so… what happens with Sibley’s bill?

Mose Buchele:
Now it’s good to go. The bill passes and it’s signed into law in June 1999. And this piece of legislation, basically what it did is create two key things. The first was the ability for consumers and a lot of the state to choose their own electric providers which is what we talked about earlier. But the second, and one of the most critical parts of all this, is that this bill created what’s called an “energy only market.”

[MUSIC]

Roman Mars:
Tell me more about that. What’s an “energy only” market?

Mose Buchele:
Yeah, so Texas’ “energy only” market is the first and only one of its kind in the country. In most other parts of the country, a power plant is paid to sit around to provide energy in case it is needed. But in Texas, power plants are only paid for the power that they produce and sell on the market. People in favor of this system, they said it was the most efficient way to do things. But critics looked at it and they said wait a second… power plants can charge more for electricity the less of it there’s available. Just like we were talking about with Enron.. it kind of creates this incentive for scarcity.

Roman Mars:
Okay, so I’m starting to see how this all fits together. Texas operates on its own grid to avoid federal regulation, making it the only energy island in the country. It’s also been deregulated to the point where there’s purposefully almost no excess energy on the grid. Which means when there’s a huge surge in demand – like say, oh I dunno, during a serious winter storm – a blackout isn’t just likely, it’s almost a certainty.

Mose Buchele:
Yes and because it’s an energy island, when the state’s grid does go down… the cavalry isn’t coming. You’re not going to be able to get energy from neighboring states the way you can in the rest of the country. So this is where we found ourselves last year as this historic winter storm bears down on the state.

ARCHIVAL TAPE / GREG ABBOT:
Demand for power is expected to potentially exceed supply during parts of Monday and Tuesday.

ARCHIVAL TAPE:
Help us to keep the system from being overloaded. Lower that thermostat just a little bit….

THE 2021 BLACKOUT

Roman Mars:
So this unprecedented storm is coming… how does the state begin to prepare?

Mose Buchele:
Well this is where ERCOT – the reliability council that we talked about earlier – comes back into the picture. Remember, ERCOT, it’s job is to make sure that its grid doesn’t break down. That we don’t get to that point.

Roman Mars:
And how does ERCOT do that now that it’s in this completely deregulated energy market in Texas?

Mose Buchele:
Okay so they’re still doing the traffic cop thing. Trying to direct enough energy onto the grid to meet demand, but like you said, now they’re operating in an “energy only” market. Which means the incentive, basically, for power generation is to operate as close to a blackout as possible, right? You could even say that ERCOT is trying to manage a grid that’s kind of working directly against their interest.

Roman Mars:
It’s like being an air traffic controller where the planes want to fly into the ground.

Mose Buchele:
I never thought of that before but yeah!

Roman Mars:
So it’s a lot of pressure to the job.

Mose Buchele:
Ton of pressure. And you can hear them feeling that pressure the afternoon before the storm started.

ARCHIVAL TAPE / DAN WOODFIN:
ERCOT is requesting all Texans to conserve energy today, Sunday through Tuesday, February 16th, to the extent that they can do so safely and reliably.

Mose Buchele:
This is ERCOT’s VP of System Operations, Dan Woodfin on a conference call with the media. Basically he’s saying, “Hey, people, we should stop using electricity, so that maybe a blackout doesn’t happen.”

Roman Mars:
But then the winter storm hits and people… reasonably enough, they just can’t conserve electricity. They need it to heat their homes..

Mose Buchele:
Yeah exactly, people are cold! I mean during the storm the airport in Dallas reported a 72 year low… It was -2 degrees in Dallas!

Roman Mars:
So people are under distress and they need heat in their homes. They cannot regulate their power the way that ERCOT wants them to. But like, it seems to me the other way to solve this is to get power plants to produce more power.

Mose Buchele:
And ERCOT tries to do that. They start calling up power plants and say, “Hey, if you can turn on, now is the time to do it.” But a lot of power plants just can’t come back online. This is the former CEO of ERCOT, Bill Magness, talking back in February 2021.

ARCHIVAL TAPE / BILL MAGNESS:
And one generator after another reported that they were tripped off, they were not able to operate.

Mose Buchele: So for the power plants, the problem is that things have just started to freeze up. They’re built in Texas for warm weather. They’re built outside so their equipment is not winterized and suddenly in this super cold weather, they really literally cannot produce power.

Roman Mars:
Wow, so like every part of this system is failing.

Mose Buchele:
Right. So ERCOT can’t get any more power right when demand is surging. That means one thing – they’ve gotta start cutting power across the state. So that’s what they do. And with people’s power getting cut, demand does start to drop. But that doesn’t work because it turns out that as the demand is dropping because of these power cuts, the supply on the grid is still dropping faster than the demand. Power plants are still breaking down all over the place.

ARCHIVAL TAPE / BILL MAGNESS:
And, at that point, we’re getting down to the frequency levels where we’re in the danger zone.

Mose Buchele:
Remember that beat of the grid we talked about. How the system is built to run at that 60hz frequency… See, if the grid falls below 60hz for too long, it causes catastrophic grid failure. That is not a planned blackout, it’s a total breakdown. That would mean hospitals don’t have electricity. Gas stations don’t have electricity. The government itself doesn’t have electricity at the offices that they’re using to manage these types of crises.

Roman Mars:
That’s apocalyptic. That’s like Mad Max.

Mose Buchele:
Yeah. It’s a humanitarian crisis. Maybe like nothing that we’ve never seen before in this country.

Roman Mars:
So how does it end up unfolding for the people managing the grid that first night?

Mose Buchele:
So that first night, the frequency on the grid drops to 59.4hz. Which is a key number because at 59.4… the clock starts.

<SFX>

ARCHIVAL TAPE / BILL MAGNESS:
If you stay at 59.4 for nine minutes or more, generation units begin to trip off on their own.

Roman Mars:
So the operators at ERCOT literally have nine minutes to get this thing right?

Mose Buchele:
That’s right. The way the grid is set up is that after nine minutes, power plants start disconnecting themselves across the state. Imagine fighter pilots ejecting themselves from the plane before it crashes. That’s effectively what power plants are doing… trying to save themselves from frying along with the rest of the grid. So these operators at ERCOT, they have nine minutes to get things right or all those awful things we mentioned start happening. And you know, what’s worse for ERCOT, is that as time ticks off the number continues to drop… so they basically decide to throw the kitchen sink at this thing. So they order this one final MASSIVE power cut to the grid. And we’re talking about millions of people who lose power because ERCOT’s trying to save the energy system. And… finally it works. The grid begins to stabilize. There were only four minutes and 37 seconds before that nine minutes was up. The grid would have totally failed.

Roman Mars:
And so this is when millions of people start waking up on Monday morning without any power.

Mose Buchele:
That’s right. Yeah, including me.

AUDIO TAPE OF MOSE BUCHELE / TEXAS WINTER STORM:
To get a sense of how icy things are now, I went to get this cooler in. And I realized I have to get this thick layer of ice off of it before I can even get it back to the house. (sound of smashing ice)

Mose Buchele:
I tried documenting as much as I could of that time. I was like nothing I had ever lived through before.

Roman Mars:
So what are you feeling at this point? It’s enough of an anomaly, you aren’t aware of all the things that are coming…. like what are you feeling when you wake up and see your breath in the morning in Texas?

Mose Buchele:
Like a lot of people, I was nervous. The weather was only getting colder and at first, you kind of figure that the power is gonna come back on quickly because that’s the way it’s always happened before but the rolling blackouts… they weren’t rolling. Typically if this happens, Texans will see their lights go out for an hour or two and then they’ll come back on and the blackout moves to somewhere else. The idea is to spread the inconvenience of the power cut around. But, again, on Monday this just isn’t happening.

Carolyn Rivera:
As far as the temperature in the house, it dropped down, like, fast.

Mose Buchele:
This is Carolyn Rivera. She’s a retired school teacher I spoke with for our series.

Carolyn Rivera:
It was so cold in here. My bed was like a block of ice. I couldn’t put on enough clothes to warm myself up.

Mose Buchele:
We’re going to keep circling back to Carolyn who’s experience in this blackout is just awful. But I do want to take a beat here and just say how dangerous it is for people to lose electricity for extended periods of time. There are people who count on power to run medical equipment, like to get dialysis, for example. And losing power means they’re unable to get these kinds of treatments. So what might just be a discomfort for some people could cost other people their lives. Which makes this next chunk of tape I’m going to play you… kind of infuriating.

ARCHIVAL TAPE / DEANN WALKER:
As y’all know, we are in an unprecedented event throughout last night and all day today…

Mose Buchele:
This is Deann Walker. She was the chair of the Public Utility Commission. The PUC oversees ERCOT and they met to talk about the energy market.

ARCHIVAL TAPE / DEANN WALKER:
I believe that there are some current situations within the ERCOT market that are causing what I’ll call distortions. It may be the wrong term, but that’s what I’m going to call it right now.

Roman Mars:
“Distortions” seems to be runder-selling it a bit.

Mose Buchele:
I’d say super under selling it.

ARCHIVAL TAPE / DEANN WALKER:
You know we’ve been in load sheds since about 1:00 this morning and that the prices weren’t at the scarcity pricing. And, I was somewhat surprised about that, sadly, to say.

Roman Mars:
So explain this to me? What is she talking about here?

Mose Buchele:
What Deann Walker is saying is that she’s surprised that the market didn’t respond the way it was supposed to. You see, state regulators expected that energy prices would go as high as possible. Higher prices would mean more power plants start generating more power.

Roman Mars:
And so did that happen? Were more power plants generating more power?

Mose Buchele:
No! Because like we said, there were no more power plants left. Power plants weren’t working. But that didn’t stop the Public Utility Commission from meeting and really using the only tool they felt like they had… They stepped in and raised the price of electricity themselves. Because that’s the market mechanism that’s supposed to bring more power to the grid.

[MUSIC]

Roman Mars:
But really the failure has nothing to do with money. Like these are physical plants that are going down. They could throw as much money at it that they want to, but it just doesn’t matter.

Mose Buchele:
No, but we created a system where this was the only lever they felt that they could pull to try to get things back working again.

Roman Mars:
It was just like this market orthodoxy took over. And they ignored the physical reality of the grid.

Mose Buchele:
Exactly. And as we entered the 2nd day and 3rd day of this blackout…. Things just got worse. Electricity wasn’t the only problem. Natural gas pipelines were breaking down too. And in Texas, during the winter, the main source of fuel that powers the entire grid is… natural gas.

Roman Mars:
So not only is the power that is going out from the power plants… there’s a problem there. But the fuel going into the power plants to make all that energy, that’s breaking down too.

Mose Buchele:
Exactly. And, as if that wasn’t bad enough, the water system starts breaking down. The water running into people’s homes starts to freeze. People’s pipes are starting to break all across the state. Things keep compounding and compounding…

Carolyn Rivera:
Imagine being in your home without being able to even use the bathroom properly and not having water. That was horrifying.

Mose Buchele:
Carolyn’s right. The whole experience was horrifying. I mean driving around Austin during the blackout I saw water shooting out of broken pipes onto the streets, freezing onto streets. I went to one apartment complex where I saw a busted raw sewage pipe on the 2nd floor, so just raw sewage was spilling out everywhere… down the stairway… into the parking lot… It was really just… wild.

Roman Mars:
So how did you fare during these four or five hectic days? When did you get your power back?

Mose Buchele:
We were pretty lucky. We lost power on our house for a few days, but KUT, the station where I work, they put me and my family up at a hotel near the station cause I was trying to report on all this. So they put us up after the first night that we spent at home in the cold and then we got to move to a hotel. And that was on what they call a critical circuit. There’s this huge point of contention that came up in this whole crisis. You’d see people post angry videos online about this too. Some parts of every community never lost power and that all kind of depending on what kind of circuit they were on. Where they were getting their electricity from. And so you would see things like the businesses in downtown Austin, a lot of the high-rise office buildings, electricity stayed up and running there the whole time. And you’d see people comment about this. Also on the live streams of the public officials like ERCOT and the PUC, people would just become livid. They’d look at these people sitting comfortably in their well-heated office buildings, sitting there cozy while millions of other people were just freezing. You know, just trying to figure out what comes next.

Roman Mars:
So these critical circuit areas downtown – where there’s fancy offices and such – they fared better than places that are less affluent. Is that right?

Mose Buchele:
That was the impression lots of people got. And I should say there’s a lot of research going on right now about how much grids locally in different parts of the state might really be set up like that. But the bottom line is… people with less means were the ones who came out of this the worst. They had less resources to get out of this whole catastrophe intact.

Roman Mars:
You had played us some tape from Carolyn Rivera where the pipes broke in her house. She sounded like it was extremely stressful and extremely difficult for her. How did she fare? How did she end up?

Mose Buchele:
So Carolyn’s from a neighborhood in East Houston that’s low income. It’s a place that had already been really devastated by hurricane Harvey some years earlier. And people there were still recovering from that hurricane when this blackout hit. And so, Carolyn and a lot of neighbors, their homes are on the older side. They might lack proper insulation and it was in homes like these where the pipes were most likely to burst. Carolyn said – she’s on a fixed income, I should add, she brings in about $1,500 a month – she said her repairs from the storm totaled more than $3,000.

Carolyn Rivera:
You just don’t have that kind of money laying around to pay that type of expense for repairs.

Mose Buchele:
So for a while after the storm, the state didn’t allow electric companies to cut people’s power. There was this moratorium on cut-offs. But by the time I talked to Carolyn a few months after the blackout, it had been lifted. So people in her situation, people in her community were facing disconnections again, but this time, not because of the blackout, but because of the bills stemming from the blackout. She was worried she couldn’t pay her bill. And that risk, the risk of being disconnected was forcing her to start rationing her own electricity.

Carolyn Rivera:
During the day, I turn my air way up to like 83. And then when I go to bed at night, then I’ll drop it down a little lower so I can rest because of the fear of getting an electric bill that I’m not able to pay.

Mose Buchele:
In the winter, she froze. Now, in the summer, she’d bake. And I asked her what she thought about everything, about the blackout, about the disconnections. And this is what she told me…

[MUSIC]

Carolyn Rivera:
My thoughts were this. I was disappointed and hurt, but not surprised. They have already demonstrated how they feel about poor people. You understand what I’m saying.

Mose Buchele:
For all to talk about markets and efficiency and profits and risk, the thing that really matters, helping the people that the system failed, that has yet to really enter the conversation here in Texas.

Carolyn Rivera:
They knew this area wasn’t going to get any power if there was a major outage. They knew that. They knew it. They knew it! They do not care.

Roman Mars:
When we come back, the blame game and whether the Texas grid can survive another major storm.

[BREAK]

Roman Mars:
So I’m back with Mose Buchele who reported all about last year’s blackout in Texas and you just told us that whole story. But I have a bunch of questions for you and I guess the first and foremost is just like.. how are things now? I know a few weeks back there was another scare with the Texas grid. How are people feeling these days?

Mose Buchele:
People are still really freaked out honestly. Like you mentioned, this whole past winter, we’ve kind of fallen into this pattern where whenever a cold front comes through, it’s almost like people are reliving the trauma of what happened last year. You see people going to grocery stores and kind of clearing out the shelves sometimes, preparing for another possible blackout. There’s also just not a lot of confidence, you know, that enough has been done to fix this thing.

Roman Mars:
Yeah, I mean, we really didn’t get into this in the main part of our story. The question of accountability. Has anyone been held responsible for the grid failure? I noticed, like when you were announcing different people when they were speaking, you use the word former a lot. The “former” head of things…

Mose Buchele:
Yeah, yeah.

Roman Mars:
So like, is that part of the accountability?

Mose Buchele:
Yeah, yeah. Up to a certain level, everybody in charge of the electric system of Texas was gone within a few weeks of this happening. All the public utility commissioners and also Bill Magness, he was the head of ERCOT. I think it’s safe to say that ERCOT was initially sort of the focus of that anger.

Roman Mars:
I totally get that people could be or even should be mad at ERCOT, but… how much could they realistically do? Because like, their hands were sort of tied by the system this group of politicians created back in the 1990s.

Mose Buchele:
Yeah, I mean, especially when it came to ERCOT, there were other people that would come forward and say, like, these are just kind of the technocrats, you know, these are the people that are running the machine that someone else built. In fact, Bill Magness, the former head of ERCOT, said exactly as much when justifying their decision to to cut power the first night of the blackout.

ARCHIVAL TAPE / BILL MAGNESS:
The fundamental decision that was made. To have outages imposed was a wise decision by the operators that we have here. We had waited – not done outages, not reduced demand – Texas would be an indeterminably long situation without power even more extensively than we are with these outages.

Mose Buchele:
So there is the former, you know, ERCOT CEO basically saying we did our job. You know, that the grid didn’t fully meltdown. So for us, it’s like…that’s a win.

Roman Mars:
Yeah. Yeah, they fulfilled their mandate and they succeeded in fulfilling their mandate. That’s basically it.

Mose Buchele:
Right? Yeah. And in doing that, you know, millions of people. Well, you know what happened…

Roman Mars:
Yeah. So as ERCOT is passing the buck, who does it land to next?

Mose Buchele:
So this really… It was like this string of finger pointing going on in Austin for months after this thing happened. So first, you had the power generators, another obvious party that’s responsible for this. These are the companies that own the power plants that failed to produce the electricity. And so there’s a lot of focus on them. What are you guys going to do to make sure this never happens again? But almost right out of the gate, the first thing you heard from the power plants was that it’s not all our fault because we didn’t have the fuel to run. The power generators are literally saying,and this is backed up by data, it’s not just them saying this, the natural gas supply dropped so hard, so fast that they could not run their plants to produce electricity. So their argument then is we could be as ready for a storm as ever, but if we don’t have fuel to run, it’s never going to help anything, so they point their fingers to the natural gas suppliers.

Roman Mars:
And so after that, like does the natural gas company, you know, like, blame somebody else?

Mose Buchele:
They absolutely did. I mean, the line from the natural gas industry was that their power had been cut by ERCOT. And so they couldn’t produce natural gas to bring to the power generators because they were victims of the blackout essentially, that was their line anyway.

Roman Mars:
So I mean, was there any truth to that? That sounds horrifying. It’s like a circular firing squad. That’s horrible.

Mose Buchele:
There is truth to it, but it’s not the whole story. The problem with that, with that kind of rationalization, is that a lot of the natural gas supply drops not because of power cuts. And in fact, a lot of the natural gas supply in the state of Texas started dropping well before the blackouts were enacted. We saw natural gas supply get really scarce even in the lead up to this storm, so it can’t all be blamed on ERCOT.

Roman Mars:
I mean, and one of the aspects of accountability is like, who’s going to pay for it? Because you mentioned that the Texas Public Utility Commission raised the price of electricity to its maximum. That was like $9000 per megawatt hour. And then it, as I understand it, the people are on the hook for that, right?

Mose Buchele:
Yeah, absolutely. There’s a lot of reporting around this after the blackout. And initially, what you might have heard a lot about are these like super high electric bills, thousands of dollars of bills. And that did affect some people in the state who had certain plans, you know, electric plans. But the reality is for most Texans, everyone’s bill is going to be a little higher for decades to come. This blackout created this kind of massive wealth transfer, essentially, and all of this debt got transferred from power companies that had to pay these huge prices for electricity and also for natural gas. All of that debt is filtering back to the ratepayer now, and it’s going to be paid off in small increments month by month over decades. And we’re talking again billions of dollars. So this is also still a very live issue. People are really pissed off about this and they feel like they were victimized by this blackout. And now they’ve got to foot the bill and pay billions to these companies that benefited from this energy scarcity.

Roman Mars:
So like in the end, if you were to balance all the, you know, the scales, you know, like the argument for deregulation was that it was supposed to make the whole system cheaper and efficient and that those savings would be felt by the consumer. That’s what they always say. But this doesn’t sound cheaper….

Mose Buchele:
No, I’ve seen a lot of studies on this and there are, of course, a lot of competing studies. But most of what I’ve seen shows that on average, your regular ratepayer, your residential consumer did not see cheaper electricity after deregulation. There are some people who say that the bigger customers, the industrial customers, they got cheaper power. But your average person at home didn’t necessarily see better prices. And then if you add on to the fact of the billions of dollars people will now be paying off because of the blackout, well, that’s certainly again… means that our system in Texas is even more expensive now than it was before the blackout. So yeah, in terms of price, it’s hard to make an argument for the system that they created when they deregulated.

Roman Mars:
So beyond, you know, figuring out who to blame, have there been any reforms that have been put in place last February so that something like this doesn’t happen again?

Mose Buchele:
Yeah, there were. Again, you know, lawmakers met. They passed some… some laws. One thing that they did was they said, power plants have to winterize. Basically, you’ve got to insulate yourself so you can run in the cold weather. Power plants did do that last fall before this winter. Parts of the natural gas system also are now not supposed to have their power cut in a blackout, which sounds like it could be helpful. But the natural gas infrastructure has not winterized, and, you know, regulators are still working on that. It’s something that they hope to have done next winter. But that process has been a lot slower and a lot more controversial, honestly, the fact that the natural gas companies have not had to do that yet.

Roman Mars:
Is there any notion of getting a real/significant line out to another electrical grid in the United States? You know, just for emergencies or something…

Mose Buchele:
That has been a big topic of conversation. And you know, we’ve heard a lot of people come out and say that not only should we do that, but many of them argue that we can do that in Texas without even giving up our independent control of the grid, right? We wouldn’t necessarily have to have tons of federal oversight. So that’s a conversation that’s going on. But it’s not really clear whether our state leadership wants to go that direction. I think there’s still this idea that this was a historic freeze, the likes of which Texas had never seen before, so why make the investment to fix a system that really works most of the time.

Roman Mars:
I mean, I guess people can wrap themselves in the idea that the system worked most of the time…. but we’re talking about people’s electricity. Shouldn’t that work all of the time?

Mose Buchele:
Totally. Another problem with the idea that the system works “most of the time” is that these storms are happening more often because of climate change. And I’m not just talking about cold spells. We have things like hurricanes. Hurricane Harvey wrecked Houston and a big part of the state not so long ago. We have massive droughts. You know, we have months and months at a time of triple digit heat. That also has its own effect on the grid. And so it’s becoming less and less possible to just say, “Oh, you know, this is going to happen every few decades and we don’t need a plan around it,” because that’s just not the case anymore.

Roman Mars:
Well, Mose, I really appreciate you sharing your story with us and telling it to our audience. And I highly recommend people go listen to “The Disconnect.” It’s a fascinating dissection of the whole event and really worth checking out no matter where you’re from.

Mose Buchele:
I really appreciate it, Roman. Thank you so much.

————-

CREDITS

Roman Mars:
99% Invisible was produced this week by Mose Buchele. Edited by Jayson De Leon. Mix and tech production by Martín Gonzalez. Music by our director of sound Swan Real. Fact checker is Graham Hacia. Delaney Hall is the executive producer. Kurt Kohlstedt is the digital director. The rest of the team includes Emmett FitzGerald, Vivian Le, Joe Rosenberg, Chris Berube, Christopher Johnson, Lasha Madan, Sofia Klatzker, and me, Roman Mars.

Special thanks to Claire McInerny, Jimmy Moss, Andrew Weber, Nadia Hamdan, Audrey McGlinchy, Matt Largey, Todd Callahan, Jake Pearlman, Stephanie Federico, and the whole team behind “The Disconnect” at KUT and KUTX Studios in Austin. You can listen to the full series on their website KUT.org or wherever you’re listening to this podcast.

99% Invisible is part of the Stitcher and SiriusXM podcast family, now headquartered six blocks north in the Pandora Building — in beautiful uptown Oakland, California.

You can find the show and join discussions about the show on Facebook. You can tweet me @romanmars and the show @99piorg. We’re on Instagram and Reddit, too. You can find links to other Stitcher shows I love as well as every past episode of 99pi at 99pi.org.