How the Texas power grid stayed on in the 1989 cold snap

WASHINGTON — In the days leading up to Christmas 1989, it got so cold in Houston that a man ice-skated on his swimming pool and Christmas tree vendors huddled around burning barrels to keep warm.

Flash forward to 2021. A similar but not quite as frigid cold snap left millions of Texans without power for days, forcing them to huddle around gas fireplaces, pile into running cars and burn fence posts. More than 40 people died from exposure, carbon monoxide poisoning and other storm-related causes.

How over the course of three decades the Texas power grid could become so much less resilient to the cold is a question that will be examined in the months ahead as state and federal officials investigate the blackouts. What they will look at it is how changes in Texas’ population, mix of energy sources and structure of its electricity markets over the past 30 years led to the events of last month, said John Moura, director of reliability assessment and performance for NERC.

“It boils down to two things on reliability: supply and demand,” he said. “On the demand side, it was a very similar profile in terms of a rare event that came strikingly close to a summer peak. But on the supply side, things looked very different.”

At the time of the 1989 cold snap, Texas’ power market still operated under a traditional utility model, in which regulated monopolies such as the old Houston Lighting & Power Co. managed the power plants, the transmission lines and then billed the customers — with rates set by state regulators based on how much money companies invested in their system. Each time utilities built backup generation to handle periods of extreme demand, they received a healthy rate of return, even if the plants sat idle nearly all the time.

But then in the late 1990s, the Texas Legislature decided to break up those old monopolies and shift to a free market system, in which generators are paid based on how much electricity they sell and prices determined by what retail power providers such as Reliant or TXU Energy are willing to pay on a given day.

While offering cheaper electricity costs (depending on whom you ask) and forcing the closure of many old, polluting plants, the market-based system offered little incentive for power companies to harden their plants against the elements. With electricity prices low in recent years and profit margins tight, merchant power companies have had little room to maneuver between the need for long-term investment in their generation capacity and the short-term demands of shareholders, critics say.

“There has been a systemic failure since the beginning of deregulation to protect the grid from predictable extreme weather events like we saw a couple weeks ago and that we can expect to increase in the future,” said Tom Smith, a veteran activist in Austin and executive director of the Texas Electric Transportation Resources Alliance, an advocacy group. “The state didn’t do what regulators are supposed to do: protect the people from predictable flaws in the system by requiring, not recommending, weatherization.”

Energy mix

What’s powering the grid has shifted too, as natural gas prices dropped with the hydraulic fracturing boom and wind power became cheaper to produce.

In the last 13 years, the generation mix on Texas’ power grid went from 45 percent natural gas, 38 percent coal, 13 percent nuclear and 2 percent wind to 47 percent natural gas, 20 percent coal, 20 percent wind and 11 percent nuclear, according to the Electric Reliability Council of Texas, the grid operator.

While that shift has resulted in fewer emissions, the loss of coal plants could have been a factor in the collapse of generating capacity during last month’s severe winter weather, Moura said. Those plants keep coal on site, and while coal piles can freeze up, it’s not hard to break them up and continue to operate.

Also, modern gas-fired plants, while more efficient, are more susceptible to freezing compared with the models of the 1980s.

“They are bigger, bulkier and less efficient, but they don’t have a lot of computer controls or valves, which can freeze up in cold weather,” Moura aid. “The older plants also are easier to dual fire, so you can burn oil if the gas supply runs low.”

During last month’s blackout, power companies reported shutting down gas plants due to natural gas shortages as wellheads froze and compressor stations along natural gas pipelines lost electricity, leaving the grid without sufficient power to meet demand for days.

On Dec. 23, 1989, ERCOT began rolling blackouts at 10:21 a.m. and ended them by 12:40 p.m. after “reserves returned to acceptable levels,” the NERC report reads.

It’s not only the grid itself that has changed.

Population boom

Since the late 1980s, Texas’ population has almost doubled, from 16.8 million to 29.4 million people, as a succession of governors lured corporations and new jobs to the state with the promise of low taxes and a cheap cost of living for workers.

With that growth came a larger, more complex power grid. While the temperatures in the 1989 and 2021 cold snaps were similar, the power load on the grid peaked above 69,000 megawatts on Feb. 14, compared with roughly 38,000 megawatts during the 1989 event. That has meant many more power generators, transmission lines and customers for ERCOT to manage.

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