One of my takeaways is that you really don't want people trying to attempt DIY heating systems. There were ~450 calls for carbon monoxide poisoning, related to people trying to heat their homes with non-electric sources or sources that worked at all. A lot of people tried to run camping stoves indoors. Others ran generators indoors. I believe a girl died because her family tried to stay warm in the car in the garage with the door closed.
> with the available power going to those willing to pay more, presumably because they need it more or can afford it.
I vehemently disagree with this. Wealthy customers should not be able to push the price of electricity high enough that others can't afford to heat their homes. Letting the market figures it out means that those with financial means get to make a choice about what to do, while the poor are universally shoehorned into the worse of the two options.
A significant part of the base load is inelastic demand. People need to heat their homes. People need their refrigerator to work so their food doesn't go bad in a time when you may or may not be able to get groceries. People need to charge their cellphones so they can let their family know that they're okay.
If there were, as you say, it still might not work. But there were a lot of pictures of empty buildings with lots of lights on, etc. so there are inefficiencies. And if customers were automatically switching off (or simply reducing their own usage) as prices went up maybe prices would never have gotten so high. Ideally it would sort of be a fine-grained "rolling blackout" where priority is determined by what a customer chooses to purchase given all the variables that only the customer is aware of. That's a functioning market.
I agree that it may be completely impractical to make it work for electricity.