Texas Power Prices to Surge 800% on Sunday Amid Searing Heat | Hacker News Reader

Texas Power Prices to Surge 800% on Sunday Amid Searing Heat

bloomberg.com

52 pointsmyshpa101 comments

It's kind of fitting that a state flush in oil wealth (the stuff that burning destroys the climate, causing extreme heat and such), is suffering worse under climate devastation, and also doesn't have enough energy to keep people safe.

The power brokers also kept their energy grid off the federal network so they could also pollute and do horrible stuff at their impunity cause 'feds are bad'.

I guess this is an economic variant of darwinism.

I don’t even know where to start. How about the low hanging fruit. What “federal network” are you talking about? Do you think there is a federal power grid?

Also: Texas leads the country in renewables generation: https://www.kxan.com/weather-traffic-qas/texas-leads-the-cou... (“ Texas more than doubled what California produced in renewable energy last calendar year. The gap will only widen in the next few years as our state looks for continued increases in solar power harnessing.”)

It seems fair to describe all the other regional ISOs as being connected in a sense (transitively) whereas ERCOT is not. What is your objection?

What's that standard for "connected"?

ERCOT is connected to Mexico's power grid [0] and other non-ERCOT regions [1].

There is no unified "federal network."

[0] https://www.forbes.com/sites/christopherhelman/2011/02/03/ro...

[1] https://www.ercot.com/gridmktinfo/dashboards/dctieflows#:~:t....

Texas operates its own independent electrical grid (presumably to avoid federal energy regulations, though I'm not sure)[1], whereas the rest of America operates roughly on two interstate grid regions. I would agree that it's ignorant to claim Texas is doing nothing against climate change though.

[1]: https://www.epa.gov/green-power-markets/us-grid-regions

While the specific choice of the word "federal' might be incorrect, I think it is likely you know what the poster means. It seems as though you are attempting to discredit the poster using an insult, rather than facts. This is not only lazy but degrades the quality of the conversation for everyone else.

"The Texas Interconnection is maintained as a separate grid for political, rather than technical reasons, but can also draw some power from other grids using DC ties. By not crossing state lines, the synchronous power grid is in most respects not subject to federal (Federal Energy Regulatory Commission) regulation."

https://en.m.wikipedia.org/wiki/Texas_Interconnection#:~:tex....

I'm puzzled how you single out the parent's tone and don't react to the GP's stance in saying it's "fitting" that Texas (not ERCOT) and its citizens are suffering worse under climate change. That's constructive for discussion? ^^

The GP claimed ERCOT was formed to pollute and avoid FERC jurisdiction. Where is that supported? It's hard to argue that reason when ERCOT was formed pre-renewables.

Separately, the GP said "ERCOT and fossil = bad, renewables = good", and yet as the parent pointed out, ERCOT is a leader in renewables production. Frankly, their permitting has allowed more renewables penetration v. FERC meddling in other markets. [0] We'll see if the recent FERC reforms help renewables.

[0] https://www.eenews.net/articles/fight-over-ferc-grid-order-c...

If you don’t know the terminology you probably don’t know that pollution is EPA’s jurisdiction, not FERC’s.

There is actually. North America has 2 or 3 large interconnects that are basically large power grids. Two places are separate: Texas and Quebec. While Quebec has a decent amount of connections to the rest of the continent and is generally well managed, Texas has one inadequate connection. Hence why it goes down at the hint of bad weather

The terminology is perhaps not exactly correct because the "grids" one would expect Texas to cooperate with are either the Eastern or the Western - but it does make a fair degree of sense. It's pretty open that Texas's reason for operating their own interconnection is to avoid federal regulation by the Federal Energy Regulatory Commission. By operating an electrical interconnect that is mostly confined by the Texas state borders, they create a strong argument that there is no interstate commerce, thus avoiding any federal oversight.

Renewable energy construction is proceeding rapidly in Texas because events have shown that the Texas interconnect lacks sufficient capacity or interconnection to reliably meet Texas's electrical demand. There is definitely a climate advantage, but it's important to understand that renewables are increasingly the cheapest option in the southwestern United States where land (the main resource wind and solar consume) is inexpensive, insolation is high, and the landscape is often amenable to wind production. The problem remains acute and the Texas legislature recently approved a ten-plus billion dollar program to construct new gas power plants to help address the need. It's more of an all-out scramble than a climate change strategy.

This situation is mostly self-made. Texas has not been a very attractive market to build generation in because the lack of interconnection makes it difficult to achieve good utilization over the full year. Texas has repeatedly backed out of efforts that would improve connectivity between Texas and the Eastern and Western through rectifier-inverter systems, for example the Tres Amigas Superstation, largely over political concerns about interstate commerce. The Texas power crisis is long brewing but didn't really achieve political visibility until the last few years.

Is the argument that a self-contained grid means no interstate commerce really that strong? With this Supreme Court, OK, fine, maybe trying to look at precedent is a sucker’s game, but I would have thought Wickard v. Fillburn would have put an end to that argument 80 years ago.

Of course, if the relevant statutes only apply to transmission across state lines, then maybe that’s the answer (I recall that’s how Southwest was able to start with an unregulated route system by flying only between Texas cities at first) but if not, I would think that regulators could establish a jurisdiction basis over 80 GW of electrical generation.

It’s questionable whether Wickard is still good law. But more importantly, the Federal Power Act is specifically addressed to interstate and wholesale electric sales. That’s why FERC doesn’t have jurisdiction over ERCOT.

Note that electric generators in Texas certainly are subject to EPA regulation, which also rests on the Commerce Power. Pollution produced by Texas plants does travel interstate, even if sales of wholesale electricity do not.

But for the same reason, the complaint about ERCOT being a way to bypass federal pollution regulation is nonsensical.

Yes, as I understand it, the long-running political tension between ERCOT and FERC primarily has to do with rate and transmission agreement regulations, not environmental regulation.

That said, FERC actually does have a fairly substantial environmental regulation function in that they handle NEPA matters for electrical initiatives triggered by federal policy. So avoiding FERC regulation may avoid having to complete NEPA process (e.g. EIS) in some cases, but it doesn't help with requirements under Clean Air Act/Clean Water Act, which are typically the more onerous for power plants.

Texas is unique in that it has the only state-only gird in the USA outside of Alaska and Hawaii. Because the grid is completely in state, it is not regulated by the federal government.

thanks for linking. interestingly, despite producing the most renewable energy as an absolute measure, apparently Texas is 18th out of US states in terms of what percentage used comes from renewable sources at 26%.

Texas consumes a huge amount of power for industrial purposes (oil refineries and chemical plants and the like). It produces a lot of power (including through renewables) but has notably high power consumption due to the industrial base and HVAC requirements.

> Also: Texas leads the country in renewables generation:

That's almost like repeating pattern. Germany is also leading in renewable generation and have one of the highest electricity prices in Europe.

Texas produces around 2.5x as much electricity as California does, so producing double the amount of renewable energy actually suggests they are behind in converting to renewables.

The US average is about 39% of electricity from renewables. Texas is at 33%. California is at 49%. (Best is Vermont at over 99%, South Dakota at 83%, and Washington at 82%).

In terms of CO2 Mt/TWh the US is 402, Texas is slightly worse at 428, California is 229, and the best are Vermont at 5, Washington at 100, New Hampshire at 131, Oregon at 143, and South Dakota at 145.

Note these figures are just electricity generated in state. For Texas that's almost all their electricity. For California around 20-30% of their electricity is imported from other states, including a lot of renewable electricity from Washington and Oregon.

Also different states use a different mix of energy sources. What might be done with electricity in one place might be done with natural gas in another place. If we want to compare states on renewable energy use it is probably more accurate to look at renewables as a percentage of total energy use.

The top three by that metric are Washington at nearly 50%, South Dakota at 43%, and Maine at 38%. California is at 16.5% and Texas is at 8.5%.

See:

https://en.wikipedia.org/wiki/List_of_U.S._states_by_electri...

A significant number of people impacted are not the ones supporting the Texan petrostate, since Texas isn't a functioning democracy.

It's pretty callous to phrase this as "economic darwinism"

That doesn't make it any less accurate.

That's what I don't get about the tone policing garbage.

A lot of people here don't like to actually face the hard truths. And instead of actual hard fact, it's just "too callous".

What about these heat deaths https://www.texastribune.org/2023/06/30/texas-heat-wave-deat... ? Are they just a 'economic deviation' from 'climate change'? Who wants to tell their families that they died so we can keep living a climate-destroying lifestyle?

There's only so much that fake positivism does. No sense in being actually mean towards people, but I'm not going to use terrible euphemisms to avoid sounding 'callous'.

This is a climate emergency, and these deaths are going to get a whole lot worse.

The more fundamental problem here is that Texas is one of the leading states in solar and wind power generation, even as a % of total utility power. The peak pricing is in large part intended to incentivize this, so that power sources (like solar) which are not 24x7 but do produce during peak times, make enough money to incentivize more. Which is working, as we see in the ever-increasing % of solar power, far ahead of most other states and pulling away.

The primary reason for peak power increases in Texas is that the population is increasing fast in the last few years. Climate change surely doesn't help, but the primary thing that has changed in the last few years is that we use a whole lot LESS oil and coal than we used to, and we have a whole lot more people than we used to.

Real time price:

https://www.ercot.com/content/cdr/contours/rtmLmp.html

Currently not high.

This is blocked for me, presumably because of my geographical location. Must get a lot of hackers from Scotland!

These peaks cry out for demand management. This means exposing customers to actual prices. But how is a homeowner to respond to these? This seems like a great use case for home automation, where systems can be automatically turned up/down, on/off, in response to changes in prices, or even in response to forecasts of changes (so, for example, a home might be precooled to below normal before a large peak, then allowed to gradually warm during the peak with the A/C turned off.)

More complex structured contracts with electricity providers might also be a solution, where consumers pay for only a certain level of reliability in the supply, with the provider being able to throttle power in tight situations.

(Precooling could be extended to making ice. A tonne of ice is ~1 m^3, which isn't that much volume. Storing energy this way could be much cheaper than doing so with batteries.)

The biggest draw is A/C. It dwarfs other usage. And unfortunately, A/C is sometimes required to avoid death. Precooling isn’t effective in that the A/C will still run for nearly as long during peak.

Precooling allows cheap pre-peak power to be used instead of very expensive peak power.

That's the critical thing. A/C isn't just a luxury anymore. As the Earth heats up, A/C becomes am absolutely necessity to avoid dying from temperatures exceeding the wet bulb temperature, where human sweat is no longer sufficient to cool people off, especially the very young or very old. The heatwaves across Europe a bunch of years back killed some 70,000 people from the heat.

> Precooling isn’t effective

Interesting, PG&E tells me to do it when the temperature is expected to be high. I've done it on occasion and it has seemed to work. I'm sure it's a YMMV situation, depending on insulation and other factors.

OTOH there are plenty of more energy efficient alternatives that avoid death to cooling an entire poorly insulated, oversized house without ventilation energy recovery at peak demand times using fossil fuel generated grid electricity.

Precooling is only viable if homes are really insulated and / or all the electricity comes from renewable as otherwise it will increase the overall energy used (as precooling is less efficient), which will increase CO2 emissions. In think the population also needs to “meet in the middle”, for instance by increasing the temperature of the AC by one degree in summer. This could get automated to offer a best effort service.

Of course precooling is less efficient. But if there are large swings in price that can more than make up for it. And if daytime solar is replacing evening peak natural gas the CO2 emissions are reduced also.

ERCOT uses demand management aka demand response: https://www.google.com/search?q=ERCOT+demand+response

I don't know how far that extends, particularly to individual consumers.

This is something I have in place in my home right now. My electric car for instance is charging itself at the hours with the lowest prices. If I want I can hook up my water boiler, my A/C etc to the same system. Pretty wild that this isn't already common in the U.S.

I remember reading about the provider Griddy that did exactly that - gave customers the wholesale rate for power. Then the 2021 winter storms hit with the price peaking at the limit of $9 per kWh ...

Yeah, that's the downside. Thus the need for home automation (or else, the ability of the grid company to cut you off if your bill exceeds some value, sorry about the burst pipes.)

There was another sharp peak on ERCOT this evening, but it was about half an hour long. This is tailor made for demand response. Simply cutting off the compressors of A/Cs for half an hour by remote control would work.

Customers in Texas should look for electricity providers who offer such remote control (there must be some) and are willing to pay you to put them on your A/C.

I predicted many years ago that the fall of America will be due to citizens unable to afford to run air con.

So, where is the free market supply/demand miracle to build more power supply here? It is a Republican state, right, can't blame anti-market Democrats for this.

Is it time lag? By the time someone thinks to build more power, it is winter again and everyone is like 'man, kind of chilly, nah-we're good'.

Supply/demand in dysregulated electricity just means to pocket the additional profit until user behaviour changes and let prices lag coming down.

There’s little like politicians who haven’t done anything in business making decisions in economy like they have.

We get the leaders we deserve.. is the saying?

Well except that also don’t have enough electricity in the winter

That's incorrect. We have significant surplus of electricity in Winter so long as gas generators (the companies that extract natural gas from the ground) can effectively work. The problem being that if gas extraction gear gets too cold (meaningfully below freezing) then it stops working, or at least works poorly.

So.. it is correct?

It's not correct. Texas has enough power in "the winter"; the average winter.

A few outlier events don't change that unless your being hyperbolic.

How many "few" cases are needed to no longer be "hyperbolic".

More than two in 50 years?

180 in 20 years.

https://www.sacurrent.com/news/texas-experienced-more-power-...

I think you are thinking in terms of there were 'only two state wide catastrophic failures that took down entire grid and became national news so I remember them'.

But really, isn't that a pretty low bar? 'we've only had 2 complete state wide grid collapses, what's the problem'.

But those 179 outages weren't "the grid" or "not enough power". We are the single largest state in the continental US. You can fit Britain into Texas 3x over. That's a LOT of power lines! Most of which are not in cities.

Of course we are going to have power outages that are localized!

I'm not saying the entire grid went down 180 times.

You said "2". There should be more than 2 before we worry.

Sorry, if you were very narrowly defining this to only 2 "Major Winter Outages". I was saying, how many problems do we need before we can say something without being considered 'hyperbolic'. There are a lot more outages.

People just remember the big ones, and forget the rest. It's trying to argue when people only have short term memory. Yeah, there were 2 big ones that people remember, that isn't all of them. Things aren't normal if there is an increasing rate.

You didn't show an increasing rate.

We were discussing grid failures, of in which there have been two in 50 years, both caused by an extreme period of low temps.

We can talk about weather events and localized incidents. It's really boring the moment we adjust for size or even per capita.

You are right.

I mixed up a few different threads to this post, between purely 'winter outages', 'total demand', 'general climate'.

I also didn't check if the article I cited was per-capita or not, or even per-Total Area, or something. If it wasn't, and since Texas is bigger, then that un-fairly tilts the numbers.

And of course, with any numbers this year, almost all replies are 'it's el-nino'. And that is true. So guess we step back and wait another few years for a more compelling trend? See if everything really does average out next year.

Dude, just stop. You keep posting this crap everywhere when we are talking about rolling blackouts and brownouts, and here talking about having enough power in the winter.

You're mad, we get it. But you're trying too hard to be right.

LOL. That is funny.

>"We have significant surplus of electricity in Winter" Unless it's >"too cold"

https://www.texastribune.org/2021/02/17/abbott-republicans-g...

https://www.rawstory.com/texas-power-outage-blackout-abbott/

It's time lag. Texas is home to the most and the largest grid battery projects, at least in the US right now. We are also having an explosion of renewables including solar and wind.

But all of that takes time. Some of it has come online and is helping, and proce jumps like this will continue to attract more of those projects.

Most responsible Texas utility customers have long term contracts. There are people who choose not to have a structured power arrangement and choose to pay spot pricing (which can be very cheap!) and they are the ones exposed to this risk.

So the market is working exactly as it's supposed to? It's also really friggin hot right now.

Except it isn’t working as it is supposed to since infrastructure investment hasn’t occurred the way it should.

> It's also really friggin hot right now.

Is there strong reason to not accept this as the new summer norm?

It's a strong El Nino this year. It will almost certainly be cooler next year.

Why have a system where it is possible to be 'irresponsible'? Why not just make it sane for everyone to begin with?

Could it be that someone is being taken advantage of? Say, perhaps, people that were mislead?

Not disagreeing but FWIW Texas has been turning purple [1] for some time now. I suspect 2021 numbers will make it even more purple as COVID drove a lot of people to Austin. I have to wonder if another factor is that Texas has it's own independent power grid and they for the most part do not tie into the rest of the US grids to let other states absorb some of their pain. [2]

[1] - https://purplestatesofamerica.org/

[2] - https://en.wikipedia.org/wiki/Texas_Interconnection

So people fled their blue states because of COVID policy, but they maintain allegiance to the policy makers? That's odd.

imo it was housing prices that drove people to places like Texas where a large house is much more affordable. COVID just made that move much easier to do with remote working

No, Austin built a tech industry and couldn’t fill all those jobs with conservative Texans, so they had to use money to attract liberal techies from other states.

Not that Austin was very conservative before COVID, well, you probably knew that.

Wholesale electricity in Texas is often $50/MWh or less. Consumers are paying $0.12/kWh delivered at retail.

It could well be that even with these price spikes the energy retailers still have enough arb during the normal times to cover these wild times. If so it seems like markets are working insofar as consumers are paying lower average prices.

It might be that occasional price spikes are more economic than building new generation capacity.

Sounds like anyone with a modicum of foresight should have been investing in power storage for when the grid breaks

Also 0.12 is cheap but not the cheapest, see for example how much people pay in Quebec

Quebec has hydropower. Texas is flat.

Texas is windy.

Flat is pretty easy to change.

There's a simple trick they used with making canals for barges back in the day. You dig a 3foot hole and line the sides with a 3foot wall and you get a 6foot deep canal.

I suspect the bigger issue with the parent's comment is that just because you know Texas has surge pricing doesn't mean that the surge will be high/long enough to cover the opportunity cost of energy storage. I bet spending say 1 billion on a new oil rig will pay back more money than 1 billion on a pumped storage.

And here in continental 'not Texas shithole', I'm paying the "exorbitant" rate of $.10916/kWh , less than the Texas rates. And mine are stable. None of this funny stock market bill crap.

Yep, deregulation is better for SOMEONE. I wonder who that might be.

I live in Austin (well known for its high energy prices relative to the rest of the state.) I’m at $0.09 for the first 300KWh (I’m including all fees/markups/charges in this calculation.)

For the next 600Kwh it goes to $.10, and then the next tier I used 882KWh at $0.12.

I find the rates reasonable. Texas is also leading the way on both solar and wind adoption. This is keeping the power supply at peak much more stable.

We pay 13 cents/kWh here in Seattle and we don’t have prices ever spiking 50X. But then we don’t really need AC that much (the high today is 74F).

I think the free market idea can work somewhat at the individual level, assuming proper tools are in place. What would have to happen is variable rate based on the amount you consume -- you get the first X KWh for the base price, going over that is where you pay the premium. So you can choose to run your AC at 72F, or 85F and not go over your allotment (or run at night to super cool your house, back off in the day, and have good insulation). Now I don't know if a tiered system is common / available at the household level, I know it exists for businesses in various markets.

A second individual option would be to use a gas generator if the electric rates are too high, and install solar for longer term savings. Individual gas generators would be a horrible option for climate change, but may be a short term solution while waiting to install solar.

You assume that this ain’t the will of the free market. People won’t pay for reliability.

You see this everywhere frankly. Reliability is only valuable to business customers. Customers will not pay for reliable appliances, reliable airlines, etc.

> Reliability is only valuable to business customers. Customers will not pay for reliable appliances, reliable airlines, etc.

Because no one has the money for that any more. Almost all of our problems, in the end, boil down to decades of wage stagnation correlated with cost-of-living explosion. Like 58% of Americans live from paycheck to paycheck [1]... they are living the Boots Theory [2] and left to deal with the fallout when disaster (inevitably) strikes.

[1] https://www.cnbc.com/2023/04/11/58percent-of-americans-are-l...

[2] https://en.wikipedia.org/wiki/Boots_theory

It might actually be "working" though. Texas generally has quite cheap electricity, and is has a TON of renewable generation and investment. A spike here in there in pricing isn't evidence to me that it's not generally producing the desired outcomes.

Nobody cares about how cheap the power is when they’re risking their health and possibly their lives.

Outside of two events in recent memory Texas also doesn't have rolling blackouts or brownouts; they are simply unheard of.

Not sure your point was clear enough. Let me paraphrase it, to help out.

"Except for a couple of failures, we don't have failures".

It's perfectly clear.

>"Texas experienced more power outages than any other state over the past 20 years, report says"

https://www.sacurrent.com/news/texas-experienced-more-power-...

Per capita, it seems like Texas is doing a lot better than other states.

> Of the 1,542 weather-related outages documented in the U.S. over the study's 20-year analysis, 180 were in Texas. Michigan ranked second with 132 and California third with 129.

Did you calculate it per-capita?

I took from the study that, the rate of outages is going up for the entire country. The total is trending up.

But we can't really pile on Texas for being worse. Its just that Texas is also increasing, but at same rate as everyone else.

We can't pile on Texas for getting worse faster, they are getting worse in line with everyone else.

Not then, but I will now:

Texas population: 29.53 million

Michigan population: 10.05 million

California population: 39.24 million

180 / 29.53 = 6.09 events per million people

132 / 10.05 = 13.1 events per million people

129 / 39.24 = 3.29 events per million people

It could be worse for other states, but I'm not going to dig for the numbers on my phone. If you do, please post your calculations.

180 in 20 years. Check it out.

The price spikes are intended (and actually succeed in) incentivizing the building of power sources like solar that do not produce 24x7, but do produce during normal peak times (when it's sunny and hot). They make enough $$ during peak prices, that they are competitive (in fact as a % of total grid capacity are rising fast, already in double-digits).

You could achieve something similar by using a flat rate, but subsidizing the solar some other way, perhaps with direct handout, and raising taxes to pay for that. In some ways, that would be more direct and easy to understand. However, this does at least have the advantage of most incentivizing the capacity which is available when it is most needed.

https://www.ercot.com/content/cdr/html/real_time_system_cond...

With electricity: Free markets, deregulation. Free for all. Disregulated.

Just the way critical utilities should be provided and consumed, without reliability.

https://archive.is/W6xmq

One more step Please complete the security check to access archive.li

What up? ^^

Well that's one way to discourage EV adoption

To be fair, in California I pay $0.67/kWh, every day, during peak. And, on hot days, we’re told to not charge our cars.

I don’t think it’s conscious discouragement. If it is, then California is much better at it, and that’s a silly proposition.

Yikes. The peak rate here in Ontario is CAD$0.157/kWh, but our delivery charges are ~$0.05/kWh on top of that (Hydro One is the worst in that regard).

Which utility is this, and what type of plan are you on? The time-of-day based plans can have extremely high pricing during peak, to discourage non-essential usage during those hours.

We are on PG&E and they moved us (involuntarily) from usage-based to time-of-day in 2021. But they promised to refund us after a year if it was more expensive on the new plan than it would have been on the old plan. It was, and we switched back. I don't think we pay even close to 67¢/kWh on the usage-based, unless we're like triple our base allotment (which we aren't, but might be if our PHEV were a full EV).

Sometimes it's also possible to put the EV on a separate EV account, so that you can have your main house on usage-based and your EV on time-of-day. Given how much you're paying, I'd look into alternatives (or not charge during peak, which most people don't need to do).

Most EVs automatically charge at night when the electric demand is at its lowest.

If you live in Austin, there’s a $4.17/mo charge you can add to your bill for unlimited charging at Austin Energy-owned Level 2 chargers. They’re installed all over the city. Many people commenting here don’t live in Texas and are unaware of initiatives like this.

https://austinenergy.com/green-power/plug-in-austin

Is it really appropriate to use Austin as a proxy for the entire state?

Didn't Texas, the state, recently pass an exceptionally high EV registration tax that 100% exempts hybrids?

Edit:

  > Austin Energy is the prime recipient of
  > Department of Energy funding and has
  > successfully led an infrastructure planning
  > process called the Texas River Cities Plug-in
  > Electric Vehicle Initiative.

You're highlighting the results at the edge of federal funding that must be spent on these things. TFA is about grid-scale problems, the energy supplying these charging ports.

Do you know why that EV registration tax was passed?

further evidence that it's totally appropriate to let markets run society.

:sarcasm: obviously

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