Small government is no match for a crisis born of the state’s twin addictions to market fixes and fossil fuels.
Since the power went out in Texas, the state’s most prominent Republicans have tried to pin the blame for the crisis on, of all things, a sweeping progressive mobilization to fight poverty, inequality and climate change. “This shows how the Green New Deal would be a deadly deal,” Gov. Greg Abbott of Texas said Wednesday on Fox News. Pointing to snow-covered solar panels, Rick Perry, a former governor who was later an energy secretary for the Trump administration, declared in a tweet “that if we humans want to keep surviving frigid winters, we are going to have to keep burning natural gas — and lots of it — for decades to come.”
The claims are outlandish. The Green New Deal is, among other things, a plan to tightly regulate and upgrade the energy system so the United States gets 100 percent of its electricity from renewables in a decade. Texas, of course, still gets the majority of its energy from gas and coal; much of that industry’s poorly insulated infrastructure froze up last week when it collided with wild weather that prompted a huge surge in demand. (Despite the claims of many conservatives, renewable energy was not to blame.) It was the very sort of freakish weather system now increasingly common, thanks to the unearthing and burning of fossil fuels like coal and gas. While the link between global warming and rare cold fronts like the one that just slammed Texas remains an area of active research, Katharine Hayhoe, a climate scientist at Texas Tech University, says the increasing frequency of such events should be “a wake up call.”
But weather alone did not cause this crisis. Texans are living through the collapse of a 40-year experiment in free-market fundamentalism, one that has also stood in the way of effective climate action. Fortunately, there’s a way out — and that’s precisely what Republican politicians in the state most fear.
An Energy-Market Free-for-All
A fateful series of decisions were made in the late-’90s, when the now-defunct, scandal-plagued energy company Enron led a successful push to radically deregulate Texas’s electricity sector. As a result, decisions about the generation and distribution of power were stripped from regulators and, in effect, handed over to private energy companies. Unsurprisingly, these companies prioritized short-term profit over costly investments to maintain the grid and build in redundancies for extreme weather.
Today, Texans are at the mercy of regulation-allergic politicians who failed to require that energy companies plan for shocks or weatherize their infrastructure (renewables and fossil fuel alike). In a recent appearance on NBC’s “Today” show, Austin’s mayor, Steve Adler, summed it up: “We have a deregulated power system in the state and it does not work, because it does not build in the incentives in order to protect people.”
This energy-market free-for-all means that as the snow finally melts, many Texans are discovering that they owe their private electricity providers thousands of dollars — a consequence of leaving pricing to the whims of the market. The $200,000 energy bills some people received, the photos of which went viral online, were, it seems, a mistake. But some bills approaching $10,000 are the result of simple supply and demand in a radically underregulated market. “The last thing an awful lot of people need right now is a higher electric bill,” said Matt Schulz, chief industry analyst with LendingTree. “And that’s unfortunately something a lot of people will get stuck with.” This is bad news for those customers, but great news for shale gas companies like Comstock Resources Inc. On an earnings call last Wednesday, its chief financial officer said, “This week is like hitting the jackpot with some of these incredible prices.”
Put bluntly, Texas is about as far from having a Green New Deal as any place on earth. So why have Republicans seized it as their scapegoat of choice?
A Shock to the System
Blame right-wing panic. For decades, the Republicans have met every disaster with a credo I have described as “the shock doctrine.” When disaster strikes, people are frightened and dislocated. They focus on handling the emergencies of daily life, like boiling snow for drinking water. They have less time to engage in politics and a reduced capacity to protect their rights. They often regress, deferring to strong and decisive leaders — think of New York’s ill-fated love affairs with then-Mayor Rudy Giuliani after the 9/11 attacks and Gov. Andrew Cuomo in the early months of the Covid-19 pandemic.
Large-scale shocks — natural disasters, economic collapse, terrorist attacks — become ideal moments to smuggle in unpopular free-market policies that tend to enrich elites at everyone else’s expense. Crucially, the shock doctrine is not about solving underlying drivers of crises: It’s about exploiting those crises to ram through your wish list even if it exacerbates the crisis.
To explain this phenomenon, I often quote a guru of the free market revolution, the late economist Milton Friedman. In 1982, he wrote about what he saw as the mission of right-wing economists like him: “Only a crisis — actual or perceived — produces real change. When that crisis occurs, the actions that are taken depend on the ideas that are lying around. That, I believe, is our basic function: to develop alternatives to existing policies, to keep them alive and available until the politically impossible becomes politically inevitable.”
Republicans have effectively deployed this tactic even after crises like the 2008 market collapse, created by financial deregulation and made deadlier by decades of austerity. Democrats have, largely, been willing partners. This seems counterintuitive, but it all comes back to Friedman’s credo: The change doesn’t depend on the reasons for the crisis, only on who has the ideas “lying around” — a kind of intellectual disaster preparedness. And for a long time, it was only the right, bolstered by a network of free-market think tanks linked to both major parties, that had its ideas at the ready.
When Hurricane Katrina broke through New Orleans’s long-neglected levees in 2005, there was, briefly, some hope that the catastrophe might serve as a kind of wake-up call. Witnessing the abandonment of thousands of residents on their rooftops and in the Superdome, small-government fetishists suddenly lost their religion. “When a city is sinking into the sea and rioting runs rampant, government probably should saddle-up,” Jonah Goldberg, a prominent right-wing commentator, wrote at the time. In environmental circles, there was also discussion that the disaster could spur climate action. Some dared to predict that the collapsed levees would be for the small-government, free-market legacy of Reaganism what the fall of the Berlin Wall was for Soviet Communism.
None of it happened. Instead, New Orleans became a laboratory for the shock doctrine. Public schools were shut down en masse, replaced by charter schools. Public housing was demolished, and costly townhouses sprang up, preventing thousands of the city’s poorest residents, the majority of them Black, from ever returning. The reconstruction of the city became a feeding ground for private contractors. Republicans used the cover of crisis to call for expanded oil and gas exploration and new refinery capacity, much as Mr. Perry is doing right now in Texas with his calls for doubling down on gas.
Many tried to stop them. Teachers’ unions, despite having their members scattered throughout the country, did their best to fight the privatizations. Residents of public housing and their supporters faced tear gas to try to stop the demolition of their homes. But there were no readily available, alternate ideas lying around for how New Orleans could be rebuilt to make it both greener and fairer for all of its residents.
Even if there had been, there was no political muscle to turn such ideas into reality. Though the environmental justice movement has deep roots in Louisiana’s “cancer alley,” the climate justice movement was only just emerging at the time Katrina struck. There was no Sunrise Movement, the youth-led organization that occupied Nancy Pelosi’s office after the 2018 midterms to demand “good jobs, and a livable planet.” There was no “squad,” the ad hoc alliance of congressional progressives whose most visible member, Alexandria Ocasio-Cortez, sent shock waves through Washington by joining the Sunrisers in their occupation. There had not yet been two Bernie Sanders presidential campaigns to show Americans how popular these ideas really are. And there was certainly no national movement for a Green New Deal.
Lying in Ruin
The difference between then and now goes a very long way toward explaining why Mr. Abbott is railing against a policy plan that, as of now, exists primarily on paper. In a crisis, ideas matter — he knows this. He also knows that the Green New Deal, which promises to create millions of union jobs building out shock-resilient green energy infrastructure, transit and affordable housing, is extremely appealing. This is especially true now, as so many Texans suffer under the overlapping crises of
- racial injustice,
- crumbling public services and
- extreme weather.
All that Texas’s Republicans have to offer, in contrast, is continued oil and gas dependence — driving more climate disruption — alongside more privatizations and cuts to public services to pay for their state’s mess, which we can expect them to push in the weeks and months ahead.
Will it work? Unlike when the Republican Party began deploying the shock doctrine, its free-market playbook is no longer novel. It has been tried and repeatedly tested: by the pandemic, by spiraling hunger and joblessness, by extreme weather. And it is failing all of those tests — so much so that even the most ardent cheerleaders of deregulation now point to Texas’s energy grid as a cautionary tale. A recent article in the Wall Street Journal, for instance, called the deregulation of Texas’s energy system “a fundamental flaw.”
In short, Republican ideas are no longer lying around — they are lying in ruin. Small government is simply no match for this era of big, interlocking problems. Moreover, for the first time since Margaret Thatcher, Britain’s former prime minister, declared that “there is no alternative” to leaving our fates to the market, progressives are ready with a host of problem-solving plans. The big question is whether the Democrats who hold power in Washington will have the courage to implement them.
The horrors currently unfolding in Texas expose both the reality of the climate crisis and the extreme vulnerability of fossil fuel infrastructure in the face of that crisis. So of course the Green New Deal finds itself under fierce attack. Because for the first time in a long time, Republicans face the very thing that they claim to revere but never actually wanted: competition — in the battle of ideas.
“But to the purveyors of the big lie—Republicans like Greg Abbott and his friends on Fox News—this very real and acute suffering is just a vehicle for their political objectives,” says Chris Hayes of the GOP blaming the Green New Deal as millions of Texans freeze. Aired on 02/17/2021.
Texas officials knew winter storms could leave the state’s power grid vulnerable, but they left the choice to prepare for harsh weather up to the power companies — many of which opted against the costly upgrades. That, plus a deregulated energy market largely isolated from the rest of the country’s power grid, left the state alone to deal with the crisis, experts said.
Millions of Texans have gone days without power or heat in subfreezing temperatures brought on by snow and ice storms. Limited regulations on companies that generate power and a history of isolating Texas from federal oversight help explain the crisis, energy and policy experts told The Texas Tribune.
While Texas Republicans were quick to pounce on renewable energy and to blame frozen wind turbines, the natural gas, nuclear and coal plants that provide most of the state’s energy also struggled to operate during the storm. Officials with the Electric Reliability Council of Texas, the energy grid operator for most of the state, said that the state’s power system was simply no match for the deep freeze.
“Nuclear units, gas units, wind turbines, even solar, in different ways — the very cold weather and snow has impacted every type of generator,” said Dan Woodfin, a senior director at ERCOT.
Energy and policy experts said Texas’ decision not to require equipment upgrades to better withstand extreme winter temperatures, and choosing to operate mostly isolated from other grids in the U.S. left power system unprepared for the winter crisis.
Policy observers blamed the power system failure on the legislators and state agencies who they say did not properly heed the warnings of previous storms or account for more extreme weather events warned of by climate scientists. Instead, Texas prioritized the free market.
“Clearly we need to change our regulatory focus to protect the people, not profits,” said Tom “Smitty” Smith, a now-retired former director of Public Citizen, an Austin-based consumer advocacy group who advocated for changes after in 2011 when Texas faced a similar energy crisis.
“Instead of taking any regulatory action, we ended up getting guidelines that were unenforceable and largely ignored in [power companies’] rush for profits,” he said.
It is possible to “winterize” natural gas power plants, natural gas production, wind turbines, and other energy infrastructure, experts said, through practices like insulating pipelines. These upgrades help prevent major interruptions in other states with regularly cold weather.
LESSONS FROM 2011
In 2011, Texas faced a very similar storm that froze natural gas wells and affected coal plants and wind turbines, leading to power outages across the state. A decade later, Texas power generators have still not made all the investments necessary to prevent plants from tripping offline during extreme cold, experts said.
Woodfin, of ERCOT, acknowledged that there’s no requirement to prepare power infrastructure for such extremely low temperatures. “Those are not mandatory, it’s a voluntary guideline to decide to do those things,” he said. “There are financial incentives to stay online, but there is no regulation at this point.”
The North American Electric Reliability Corporation, which has some authority to regulate power generators in the U.S., is currently developing mandatory standards for “winterizing” energy infrastructure, a spokesperson said.
Texas politicians and regulators were warned after the 2011 storm that more “winterizing” of power infrastructure was necessary, a report by the Federal Energy Regulatory Commission and the North American Electric Reliability Corporation shows. The large number of units that tripped offline or couldn’t start during that storm, “demonstrates that the generators did not adequately anticipate the full impact of the extended cold weather and high winds,” regulators wrote at the time. More thorough preparation for cold weather could have prevented the outages, the report said.
“This should have been addressed in 2011 by the Legislature after that market meltdown, but there was no substantial follow up,” by state politicians or regulators, said Ed Hirs, an energy fellow and economics professor at the University of Houston. “They skipped on down the road with business as usual.”
ERCOT officials said that some generators implemented new winter practices after the freeze a decade ago, and new voluntary “best practices” were adopted. Woodfin said that during subsequent storms, such as in 2018, it appeared that those efforts worked. But he said this storm was even more extreme than regulators anticipated based on models developed after the 2011 storm. He acknowledged that any changes made were “not sufficient to keep these generators online,” during this storm.
After temperatures plummeted and snow covered large parts of the state Sunday night, ERCOT warned increased demand might lead to short-term, rolling blackouts. Instead, huge portions of the largest cities in Texas went dark and have remained without heat or power for days. On Tuesday, nearly 60% of Houston households and businesses were without power. Of the total installed capacity to the electric grid, about 40% went offline during the storm, Woodfin said.
CLIMATE WAKE-UP CALL
Climate scientists in Texas agree with ERCOT leaders that this week’s storm was unprecedented in some ways. They also say it’s evidence that Texas is not prepared to handle an increasing number of more volatile and more extreme weather events.
“We cannot rely on our past to guide our future,” said Dev Niyogi, a geosciences professor at the University of Texas at Austin who previously served as the state climatologist for Indiana. He noted that previous barometers are becoming less useful as states see more intense weather covering larger areas for prolonged periods of time. He said climate scientists want infrastructure design to consider a “much larger spectrum of possibilities” rather than treating these storms as a rarity, or a so-called “100-year event”.
Katharine Hayhoe, a leading climate scientist at Texas Tech University, highlighted a 2018 study that showed how a warming Arctic is creating more severe polar vortex events. “It’s a wake up call to say, ‘What if these are getting more frequent?’” Hayhoe said. “Moving forward, that gives us even more reason to be more prepared in the future.”
Still, Hayhoe and Niyogi acknowledged there’s uncertainty about the connection between climate change and cold air outbreaks from the Arctic.
Other Texas officials looked beyond ERCOT. Dallas County Judge Clay Jenkins argued that the Texas Railroad Commission, which regulates the oil and gas industry — a remit that includes natural gas wells and pipelines — prioritized commercial customers over residents by not requiring equipment to be better equipped for cold weather. The RRC did not immediately respond to a request for comment.
“Other states require you to have cold weather packages on your generation equipment and require you to use, either through depth or through materials, gas piping that is less likely to freeze,” Jenkins said.
Texas’ electricity market is also deregulated, meaning that no one company owns all the power plants, transmission lines and distribution networks. Instead, several different companies generate and transmit power, which they sell on the wholesale market to yet more players. Those power companies in turn are the ones that sell to homes and businesses. Policy experts disagree on whether a different structure would have helped Texas navigate these outages. “I don’t think deregulation itself is necessarily the thing to blame here,” said Josh Rhodes, a research associate at University of Texas at Austin’s Energy Institute.
HISTORY OF ISOLATION
Texas’ grid is also mostly isolated from other areas of the country, a set up designed to avoid federal regulation. It has some connectivity to Mexico and to the Eastern U.S. grid, but those ties have limits on what they can transmit. The Eastern U.S. is also facing the same winter storm that is creating a surge in power demand. That means that Texas has been unable to get much help from other areas.
“If you’re going to say you can handle it by yourself, step up and do it,” said Hirs, the UH energy fellow, of the state’s pursuit of an independent grid with a deregulated market. “That’s the incredible failure.”
Rhodes, of UT Austin, said Texas policy makers should consider more connections to the rest of the country. That, he acknowledged, could come at a higher financial cost — and so will any improvements to the grid to prevent future disasters. There’s an open question as to whether Texas leadership will be willing to fund, or politically support, any of these options.
“We need to have a conversation about if we believe that we’re going to have more weather events like this,” Rhodes said. “On some level it comes down to if you want a more resilient grid, we can build it, it will just cost more money. What are you willing to pay? We’re going to have to confront that.”