ERCOT, PUC, and deregulation got us here

[Francisco 2.0 32395]

Hmmm.

https://www.autonews.com/technology/tesla-plugging-secret-mega-battery-texas-grid-report-says

 

Quote

Elon Musk is getting into the Texas power market, with previously unrevealed construction of a gigantic battery connected to an ailing electric grid that nearly collapsed last month. The move marks Tesla Inc.’s first major foray into the epicenter of the U.S. energy economy.

A Tesla subsidiary registered as Gambit Energy Storage LLC is quietly building a more than 100 megawatt energy storage project in Angleton, Texas, a town roughly 40 miles south of Houston. A battery that size could power about 20,000 homes on a hot summer day. Workers at the site kept equipment under cover and discouraged onlookers, but a Tesla logo could be seen on a worker’s hard hat and public documents helped confirm the company’s role.

 

Quote

Property records on file with Brazoria County show Gambit shares the same address as a Tesla facility near the company’s auto plant in Fremont, California. A filing with the U.S. Securities and Exchange Commission lists Gambit as a Tesla subsidiary. Executives from Tesla did not respond to multiple requests for comment.

As winter storms pummeled Texas in February and left millions without power for days, Musk took to Twitter to mock the Electric Reliability Council of Texas, or Ercot, the nonprofit group that manages the flow of electric power to more than 26 million customers. “Not earning that R,” he wrote. Musk, 49, recently moved to Texas and his various companies are expanding operations in the state.

 

Quote

The battery-storage system being built by Tesla’s Gambit subsidiary is registered with Ercot. Warren Lasher, senior director of system planning at Ercot, said the project has a proposed commercial operation date of June 1. The site is adjacent to a Texas-New Mexico Power substation.

While Tesla is known for its sleek, battery-powered electric vehicles, it’s always been more than a car company: its official mission is to “accelerate the world’s transition to sustainable energy.” Utility-scale batteries are needed to store the electricity produced by wind and solar, but they can also become lucrative opportunities. By storing excess electricity when prices and demand are low, battery owners can sell it back to the grid when prices are high.

 

Spoiler

Tesla has spent years expanding into residential energy technology. Back in March 2015, Musk unveiled a home battery product, dubbed the Powerwall, with a splashy event at its design studio near Los Angeles. Scores of utility and energy executives attended. A year later Tesla acquired SolarCity, the solar-panel installer founded by Musk and his cousins. Musk then hawked a “solar roof” that has gone through several iterations without becoming a strong contender in the market.

But the company’s product lineup already reaches beyond the home and into the electrical grid. The Tesla Powerpack and even larger Megapack were designed with utility customers in mind. Tesla’s battery project in South Australia, launched in 2017, is adjacent to a wind farm and can store surplus electricity generated on gusty nights for daytime demand. At 100 megawatts, it was the largest battery project in the world at its launch.

While Tesla’s focus on energy often takes a back seat to the increasingly competitive business of manufacturing and selling electric cars, Musk and his executive team continue to highlight energy as a key part of their growth. “I think long-term Tesla Energy will be roughly the same size as Tesla Automotive,” Musk said during an earnings call in July 2020. “The energy business is collectively bigger than the automotive business.”

Tesla’s battery packs are connected to Southern California Edison’s Mira Loma substation, located east of Los Angeles. The 20 megawatt system, which has been online since December 2016, supports grid operation during peak hours and helps the utility make the most of its renewable resources. In the San Francisco Bay Area, PG&E Corp. and Tesla are constructing a 182.5 megawatt system at an electric substation in Moss Landing that should be operational by August.

Tesla Energy could represent up to 30 percent of the company’s total revenue by the 2030s, up from roughly 6 percent today, according to analyst Alexander Potter of Piper Sandler. His research has highlighted the potential for Autobidder, a software platform Tesla designed for utilities. Tesla CFO Zachary Kirkhorn has described Autobidder as an “autonomous energy market participation system that does high-frequency trading.” Potter has a $1,200 price target on Tesla stock, the highest on Wall Street.

“Tesla’s energy storage business on a percentage basis is growing faster than their car business, and it’s only going to accelerate,” said Daniel Finn-Foley, head of energy storage at Wood MacKenzie Power and Renewables. “They are absolutely respected as a player, and they are competing aggressively on price.”

Musk’s empire has numerous branches in Texas, and with the billionaire’s recent relocation from California, the Lone Star state now appears set to become the center of his universe. Space Exploration Technologies Corp., or SpaceX, is building and testing Starship, a new rocket and spacecraft designed to take humans to Mars, at a facility in Boca Chica on the southern tip of the Gulf Coast. Another rocket-testing facility is located in McGregor, near Waco.

SpaceX has posted engineering positions in Austin for a “new, state of the art manufacturing facility” for Starlink, a space-based high speed Internet service. Tesla is also building a new factory in East Austin for its forthcoming Cybertruck, an electric pickup. Gigafactory Texas, as the facility is known, will create 5,000 mid-level manufacturing jobs and is supposed to produce the first vehicles by the end of this year.

Musk’s focus on Texas comes as the dominant U.S. energy hub—with its abundant natural gas, oil, solar and wind resources—is being transformed by the surging growth of renewables. For more than a century the Texas grid has transported power from large plants to customers over miles of transmission lines. The recent storms have highlighted just how fragile that legacy system is in the era of climate change. With the build-out of giant batteries like those made by Tesla’s Gambit project and others, the state’s power grid could be remade around distributed generation that may prove more resilient.

About 2,100 megawatts of battery storage and 37,000 megawatts of solar and wind are in advanced stages of connecting to Ercot’s grid. “It’s not only stunning but the financing is already in place,” Jigar Shah said on March 2, a day before the clean-energy pioneer was named as director of the U.S. Energy Department’s loan finance office.

The Gambit project was originally developed by San Francisco-based Plus Power, a privately held renewables company that has battery operations in several states. Scott Albert, the former city manager of Angleton, said it was obvious that Plus Power was working with Tesla. A project summary available on the city’s website features images of Tesla’s utility-scale battery products, and some of Plus Power’s principal staffers previously worked at Tesla. (Plus Power confirmed its sale of the project to an undisclosed party and declined further comment.)

The Gambit project is not hard to find in Angleton, a small town of roughly 3,000 people in the middle of the Brazoria National Wildlife Refuge. But people on the construction site appear to have instructions to avoid drawing attention or answering questions from passersby. A photographer who attempted to observe from the front gate was told by a worker that it was a “secretive project.” White sheets obscured what appeared to be Tesla’s modular Megapacks.

In Texas, Albert said, it’s common for developers in real estate or energy to begin projects with several potential partners or purchasers waiting in the wings. It made sense to him that the project ended up with the state’s biggest billionaire. “Elon Musk has a lot of activity in Texas right now,” said Albert. “It wouldn’t surprise me if Musk is thinking about starting his own power company.”

 

 

[Biff Tannen 45695]

2 minutes ago, Francisco 2.0 said:

Hmmm.

https://www.autonews.com/technology/tesla-plugging-secret-mega-battery-texas-grid-report-says

 

 

 

 

  Reveal hidden contents

Tesla has spent years expanding into residential energy technology. Back in March 2015, Musk unveiled a home battery product, dubbed the Powerwall, with a splashy event at its design studio near Los Angeles. Scores of utility and energy executives attended. A year later Tesla acquired SolarCity, the solar-panel installer founded by Musk and his cousins. Musk then hawked a “solar roof” that has gone through several iterations without becoming a strong contender in the market.

But the company’s product lineup already reaches beyond the home and into the electrical grid. The Tesla Powerpack and even larger Megapack were designed with utility customers in mind. Tesla’s battery project in South Australia, launched in 2017, is adjacent to a wind farm and can store surplus electricity generated on gusty nights for daytime demand. At 100 megawatts, it was the largest battery project in the world at its launch.

While Tesla’s focus on energy often takes a back seat to the increasingly competitive business of manufacturing and selling electric cars, Musk and his executive team continue to highlight energy as a key part of their growth. “I think long-term Tesla Energy will be roughly the same size as Tesla Automotive,” Musk said during an earnings call in July 2020. “The energy business is collectively bigger than the automotive business.”

Tesla’s battery packs are connected to Southern California Edison’s Mira Loma substation, located east of Los Angeles. The 20 megawatt system, which has been online since December 2016, supports grid operation during peak hours and helps the utility make the most of its renewable resources. In the San Francisco Bay Area, PG&E Corp. and Tesla are constructing a 182.5 megawatt system at an electric substation in Moss Landing that should be operational by August.

Tesla Energy could represent up to 30 percent of the company’s total revenue by the 2030s, up from roughly 6 percent today, according to analyst Alexander Potter of Piper Sandler. His research has highlighted the potential for Autobidder, a software platform Tesla designed for utilities. Tesla CFO Zachary Kirkhorn has described Autobidder as an “autonomous energy market participation system that does high-frequency trading.” Potter has a $1,200 price target on Tesla stock, the highest on Wall Street.

“Tesla’s energy storage business on a percentage basis is growing faster than their car business, and it’s only going to accelerate,” said Daniel Finn-Foley, head of energy storage at Wood MacKenzie Power and Renewables. “They are absolutely respected as a player, and they are competing aggressively on price.”

Musk’s empire has numerous branches in Texas, and with the billionaire’s recent relocation from California, the Lone Star state now appears set to become the center of his universe. Space Exploration Technologies Corp., or SpaceX, is building and testing Starship, a new rocket and spacecraft designed to take humans to Mars, at a facility in Boca Chica on the southern tip of the Gulf Coast. Another rocket-testing facility is located in McGregor, near Waco.

SpaceX has posted engineering positions in Austin for a “new, state of the art manufacturing facility” for Starlink, a space-based high speed Internet service. Tesla is also building a new factory in East Austin for its forthcoming Cybertruck, an electric pickup. Gigafactory Texas, as the facility is known, will create 5,000 mid-level manufacturing jobs and is supposed to produce the first vehicles by the end of this year.

Musk’s focus on Texas comes as the dominant U.S. energy hub—with its abundant natural gas, oil, solar and wind resources—is being transformed by the surging growth of renewables. For more than a century the Texas grid has transported power from large plants to customers over miles of transmission lines. The recent storms have highlighted just how fragile that legacy system is in the era of climate change. With the build-out of giant batteries like those made by Tesla’s Gambit project and others, the state’s power grid could be remade around distributed generation that may prove more resilient.

About 2,100 megawatts of battery storage and 37,000 megawatts of solar and wind are in advanced stages of connecting to Ercot’s grid. “It’s not only stunning but the financing is already in place,” Jigar Shah said on March 2, a day before the clean-energy pioneer was named as director of the U.S. Energy Department’s loan finance office.

The Gambit project was originally developed by San Francisco-based Plus Power, a privately held renewables company that has battery operations in several states. Scott Albert, the former city manager of Angleton, said it was obvious that Plus Power was working with Tesla. A project summary available on the city’s website features images of Tesla’s utility-scale battery products, and some of Plus Power’s principal staffers previously worked at Tesla. (Plus Power confirmed its sale of the project to an undisclosed party and declined further comment.)

The Gambit project is not hard to find in Angleton, a small town of roughly 3,000 people in the middle of the Brazoria National Wildlife Refuge. But people on the construction site appear to have instructions to avoid drawing attention or answering questions from passersby. A photographer who attempted to observe from the front gate was told by a worker that it was a “secretive project.” White sheets obscured what appeared to be Tesla’s modular Megapacks.

In Texas, Albert said, it’s common for developers in real estate or energy to begin projects with several potential partners or purchasers waiting in the wings. It made sense to him that the project ended up with the state’s biggest billionaire. “Elon Musk has a lot of activity in Texas right now,” said Albert. “It wouldn’t surprise me if Musk is thinking about starting his own power company.”

 

 

Good.  I figured he would jump on this.  It worked wonders in Australia.

[SydneyCarton 48134]

I mean, Texas has long needed this before any blackout. It's a necessary supplement to wind and solar energy in any state. That being said, I wonder how he'll feel if the price cap comes way down or is ended, and he can't benefit from 9k, pricing to sell back into the grid. Australia has deregulated retail electricity, but I don't know how they energy generation segment works in regards to pricing. I'm assuming it is not at all like Texas. But if it is, that would certainly explain why he built a super battery there. 

 

But yeah, this is a common sense net positive, imo. Speaking of other common sense net positives, the fucking windmills we have shouldn't be in the goddamn panhandle. They should be off the coast of places like Corpus Christi, they way they are in Scotland and the east coast. Where, you know, it's windy 100% of the fucking time. Of course, there's no subsidies and monies for private landowners in that scenario...

[Updawg 2280]

There are windmills by corpus

[kevwun 15811]

Yeah, there are a bunch down there.  It is also windy in West Texas most of the time.  We have a deer lease next to 60 or 70 turbines and they are always spinning.

[bluto 4934]

Enron used the trading desk to fraudulently manufacture "bookable" revenue, but they were literally a cult whose mantra was deregulate everything.
Meanwhile, over here in Beaumont our capacity market kept us warm while the rest of Texas froze.

I think your core body temps are higher from the toxins already so y’all were good anyhow.

[YChang 3455]

So a lot of bills are being introduced by the speaker... let see if they pass or how water down they get. Especially ones that are calling for energy generators and oil/gas producers to update their equipment to be more resilient. 

Also eager to see with amusement who the new ERCOT board members will be. 

[Foosters 17858]

52 minutes ago, kevwun said:

Yeah, there are a bunch down there.  It is also windy in West Texas most of the time.  We have a deer lease next to 60 or 70 turbines and they are always spinning.

But what do you guys do about all the bird cancer?

[elfenix 34331]

iirc there was a lot of opposition to coastal wind from the king ranch.  also, i think there were questions about hurricane survival. 

anyway, lots of turbines in south texas now but not seeing anything off shore atm

https://eerscmap.usgs.gov/uswtdb/

[BearSchlong 8104]

Specifically. . .

 

So Griddy gone, I'm curious as to the motivation behind HB17 from (D) Joe Deshotel. . .

Edited March 8, 2021 by BearSchlong

[elfenix 34331]

1 board member to represent consumer interests

 

wonder what exactly prompted HB17?

[SydneyCarton 48134]

3 hours ago, kevwun said:

Yeah, there are a bunch down there.  It is also windy in West Texas most of the time.  We have a deer lease next to 60 or 70 turbines and they are always spinning.

I'm not being a dick when I ask this, but how much time do you spend there between June-August. I'm guessing since you said Deer Lease, it's not too often. The reason I ask is because (and I can't verify this personally myself either) the largest and most consistent knock on wind energy in Texas is that when Texas needs it the most (July, August) it doesn't blow much. But it blows the rest of the year when Texas isn't anywhere near the maximum capacity. I've been hearing this for well over a decade, so I've just accepted it as the truth. People always bitching about wind power not blowing in the summer. 

[kevwun 15811]

Not as much as the fall, but there is wind there even in the summer when we go.  I think the only times I've seen them stopped is when they have been shut off because the wind is blowing too hard.  These particular turbines are built on top of the Brady Mountains which look like miniature mountains with the top shaved off flat.  Even if there's only a slight breeze on the ground where we are, they are still turning rather quickly.

Edited March 8, 2021 by kevwun

[SydneyCarton 48134]

3 hours ago, Updawg said:

There are windmills by corpus

I mean, I specified of the coast. I'm honestly not sure if they have windmills on the land in South Texas, but to my knowledge and a quick google there isn't a single wind farm in the gulf of mexico near ANY state yet. Actually, no there is one:

https://en.wikipedia.org/wiki/Gulf_Wind_Farm

 

But weirdly it is NOT listed here:
https://en.wikipedia.org/wiki/List_of_offshore_wind_farms_in_the_United_States

And yeah, 283 watts. At maximum output that's .3% of the grid. Basically a non-entity. 

[kevwun 15811]

My wife actually did some of the field surveys for that project.

[tx 3 putt 77235]

47 minutes ago, SydneyCarton said:

I mean, I specified of the coast. I'm honestly not sure if they have windmills on the land in South Texas, but to my knowledge and a quick google there isn't a single wind farm in the gulf of mexico near ANY state yet. Actually, no there is one:

https://en.wikipedia.org/wiki/Gulf_Wind_Farm

 

But weirdly it is NOT listed here:
https://en.wikipedia.org/wiki/List_of_offshore_wind_farms_in_the_United_States

And yeah, 283 watts. At maximum output that's .3% of the grid. Basically a non-entity. 

 

i think they want to build a big one off the kenedy ranch but they have the money to fight it 

[Bullneck 19185]

On 3/4/2021 at 6:00 PM, Captainant said:

WITHOUT FUCKING CAUSE???? ARE YOU GODDAMN KIDDING ME?

 

$813,525.93

 

Magness' base salary was $813,525.93. ERCOT's board of directors approved a 60-day termination notice for Magness Wednesday. A search for his replacement has already started, according to the board

[Blotto 23560]

3 hours ago, SydneyCarton said:

I'm not being a dick when I ask this, but how much time do you spend there between June-August. I'm guessing since you said Deer Lease, it's not too often. The reason I ask is because (and I can't verify this personally myself either) the largest and most consistent knock on wind energy in Texas is that when Texas needs it the most (July, August) it doesn't blow much. But it blows the rest of the year when Texas isn't anywhere near the maximum capacity. I've been hearing this for well over a decade, so I've just accepted it as the truth. People always bitching about wind power not blowing in the summer. 

A quick google search leads me to believe that while there is monthly variance, its probably not as extreme as you have led yourself to believe

https://www.eia.gov/todayinenergy/detail.php?id=45476

Quote

On a monthly basis, Texas wind power generation in 2019 ranged from a low of 6.3 thousand GWh in June to a high of 7.9 thousand GWh in April. In April 2019, wind generators in Texas ran at an overall 44% capacity factor (the utilization rate of total generating capacity). Monthly wind capacity factors in Texas are slightly higher and less variable than in the United States as a whole.

 

[SydneyCarton 48134]

12 minutes ago, Blotto said:

A quick google search leads me to believe that while there is monthly variance, its probably not as extreme as you have led yourself to believe

https://www.eia.gov/todayinenergy/detail.php?id=45476

 

I mean, that actually supports the narrative better than you might think. Output is at the lowest the month when it’s most needed, August, and the difference between 2-3 gigawatts is rolling blackouts. But you’re right, it’s lot the wind variance as much as it’s the time and the need. 

[jimmyjazz 46000]

It's important to understand that the variability of wind power drops as more turbines (and geography) are aggregated.  That's part of the design.  It's why the net power output is reasonably constant over the calendar year.

I don't think there is a particularly good argument for the idea that wind power should peak when Texans "need it the most".  Just having a near-constant renewable power source with good economics is good enough.  Peaker plants exist for a reason, too.

[SydneyCarton 48134]

6 minutes ago, jimmyjazz said:

It's important to understand that the variability of wind power drops as more turbines (and geography) are aggregated.  That's part of the design.  It's why the net power output is reasonably constant over the calendar year.

I don't think there is a particularly good argument for the idea that wind power should peak when Texans "need it the most".  Just having a near-constant renewable power source with good economics is good enough.  Peaker plants exist for a reason, too.

I don’t disagree man, I’m simply pointing out the common criticism against win power in Texas. Which I’m sure you hear from right wing politicians and fossil fuel energy companies the most. But it exists. And remember, I was the guy advocating more windmills in the gulf to reduce variability even further to take away that criticism. 

[jimmyjazz 46000]

5 minutes ago, SydneyCarton said:

I don’t disagree man, I’m simply pointing out the common criticism against win power in Texas. Which I’m sure you hear from right wing politicians and fossil fuel energy companies the most. But it exists. And remember, I was the guy advocating more windmills in the gulf to reduce variability even further to take away that criticism. 

Oh, I get it, for sure.  We live in a fact-averse world, and in a fossil fuel state.  There are plenty of hearts and minds that will never be won.

[Hagbard Celine 10897]

what i learned today from someone from midland and with extended family and a personal network still on the llano, with a half-dozen out in the fields.....

they out were before sunrise in minus-zero at wells that had shut down the night before.  they could not get the flow restarted because the "substations" that consolidate a bunch of wells had all lost power.  the wells stopped flowing and froze up.  they used blowtorches for 3 days to unfreeze the wells, but only when the "substations" (apology for not knowing the lingo here) got power back were they able to actually restart the wells.  what would have fixed the problem is a "heat-collar" (?) on the top 20% of wells by production volume, guess was 1000 wells in that 20%, cost of $250k per well to install a heat collar and battery backup capable of keeping the gas flowing, and $5m to put generators+ other stuff in each "substation".

cost to "winterize" top 20% of natural gas wells in texas: $250m.

cost to "winterize" the "substations" $5m x ?????

rough swag, $500m.

[Biff Tannen 45695]

5 minutes ago, Hagbard Celine said:

what i learned today from someone from midland and with extended family and a personal network still on the llano, with a half-dozen out in the fields.....

they out were before sunrise in minus-zero at wells that had shut down the night before.  they could not get the flow restarted because the "substations" that consolidate a bunch of wells had all lost power.  the wells stopped flowing and froze up.  they used blowtorches for 3 days to unfreeze the wells, but only when the "substations" (apology for not knowing the lingo here) got power back were they able to actually restart the wells.  what would have fixed the problem is a "heat-collar" (?) on the top 20% of wells by production volume, guess was 1000 wells in that 20%, cost of $250k per well to install a heat collar and battery backup capable of keeping the gas flowing, and $5m to put generators+ other stuff in each "substation".

cost to "winterize" top 20% of natural gas wells in texas: $250m.

cost to "winterize" the "substations" $5m x ?????

rough swag, $500m.

Good thing we've been hanging on to that extra $12B in the rainy day fund.  Only a few dozen people froze to death.  NBD.

[Blotto 23560]

8 minutes ago, Hagbard Celine said:

what i learned today from someone from midland and with extended family and a personal network still on the llano, with a half-dozen out in the fields.....

they out were before sunrise in minus-zero at wells that had shut down the night before.  they could not get the flow restarted because the "substations" that consolidate a bunch of wells had all lost power.  the wells stopped flowing and froze up.  they used blowtorches for 3 days to unfreeze the wells, but only when the "substations" (apology for not knowing the lingo here) got power back were they able to actually restart the wells.  what would have fixed the problem is a "heat-collar" (?) on the top 20% of wells by production volume, guess was 1000 wells in that 20%, cost of $250k per well to install a heat collar and battery backup capable of keeping the gas flowing, and $5m to put generators+ other stuff in each "substation".

cost to "winterize" top 20% of natural gas wells in texas: $250m.

cost to "winterize" the "substations" $5m x ?????

rough swag, $500m.

Considering the $2.1 billion in extra energy charges assessed to Brazos Electric Power Co-op alone during the Feb shitshow, that seems like $500 million well spent. Im sure they will get it done this summer. Or not. 

[Kringelbert Fishtybuns 944]

1 hour ago, SydneyCarton said:

I mean, that actually supports the narrative better than you might think. Output is at the lowest the month when it’s most needed, August, and the difference between 2-3 gigawatts is rolling blackouts. But you’re right, it’s lot the wind variance as much as it’s the time and the need. 

Also, the data set is averaged monthly.  The bigger problem is the time of day the turbines are available during those months.  

[Hagbard Celine 10897]

5 hours ago, BearSchlong said:

which HB covers the following:

1. property tax relief for property owners that were catastrophe-&-ercot-identified as being located in non-essential circuits on the grid

OR

2. compensation for required investments to upgrade properties on non-essential grid circuits to insure power and water during the next collapse of civilization due to republican laws

whatever the number is for 2, that is the number that has to be placed against assessed value _PAYMENTS_ with respect to 1.

it's either or.

someone pays me 50k for a 10000 gallon cistern, 2 tesla walls, and an enclosed and environmentally controlled "other structure" for the pool equipment.

or i get a 50k discount (basically 5 free years) of no property tax.  travis county can bill the pubs for the shortfall.  for 70% of the homes in the county.

it's real simple.

everyone who didn't suffer got what they paid for.

everyone who suffered didn't get what they paid for.

you hear that felon patrick, dana, and wheels?

heads.

on.

pikes.

[Hagbard Celine 10897]

also, which HB covers fines for business owners using electricity FOR NO PURPOSE WHATSOEVER when the grid is about to collapse?

office towers in downtown empty because of the rona?  triple fine for lighting up empty unused space when the temperature is below freezing or above 90 degrees.

1000 dollars per light fixture per hour, day or night.

i'm sure that's in someone's bill, right?

right?

[SydneyCarton 48134]

Some interesting info today:

http://www.energychoicematters.com/stories/20210308ay.html

I don't understand how Brazos Electric Power, which serves about 1.5 million folks could have lost their ass to the tune of 1.8 BILLION dollars in this.

Entrust at 260 million also blows my fucking mind. 

It took some very irresponsible behavior in their hedging to get to that point. And you shouldn't see that behavior in a regulated entity like Brazos, imo. But damn. 

Edited March 9, 2021 by SydneyCarton

[Biff Tannen 45695]

15 hours ago, Hagbard Celine said:

which HB covers the following:

1. property tax relief for property owners that were catastrophe-&-ercot-identified as being located in non-essential circuits on the grid

OR

2. compensation for required investments to upgrade properties on non-essential grid circuits to insure power and water during the next collapse of civilization due to republican laws

whatever the number is for 2, that is the number that has to be placed against assessed value _PAYMENTS_ with respect to 1.

it's either or.

someone pays me 50k for a 10000 gallon cistern, 2 tesla walls, and an enclosed and environmentally controlled "other structure" for the pool equipment.

or i get a 50k discount (basically 5 free years) of no property tax.  travis county can bill the pubs for the shortfall.  for 70% of the homes in the county.

it's real simple.

everyone who didn't suffer got what they paid for.

everyone who suffered didn't get what they paid for.

you hear that felon patrick, dana, and wheels?

heads.

on.

pikes.

 

15 hours ago, Hagbard Celine said:

also, which HB covers fines for business owners using electricity FOR NO PURPOSE WHATSOEVER when the grid is about to collapse?

office towers in downtown empty because of the rona?  triple fine for lighting up empty unused space when the temperature is below freezing or above 90 degrees.

1000 dollars per light fixture per hour, day or night.

i'm sure that's in someone's bill, right?

right?

You got my vote.  When is the primary?

[Jiggy-Z 3433]

Good article from DC Report and links to others on how we got here and the fallout.

https://www.dcreport.org/2021/03/09/texans-why-the-deep-freeze-power-debacle-will-cost-billions/

[SydneyCarton 48134]

4 hours ago, Jiggy-Z said:

Good article from DC Report and links to others on how we got here and the fallout.

https://www.dcreport.org/2021/03/09/texans-why-the-deep-freeze-power-debacle-will-cost-billions/

Yeah that’s not a bad article. 

[TwiceHorn 31512]

On 3/8/2021 at 8:02 PM, Biff Tannen said:

Good thing we've been hanging on to that extra $12B in the rainy day fund.  Only a few dozen people froze to death.  NBD.

State shouldn't have to pay that.

[SydneyCarton 48134]

2 minutes ago, TwiceHorn said:

State shouldn't have to pay that.

The generators and mid stream companies need to pay it. Or a huge chunk. 

[Updawg 2280]

State shouldn't have to pay that.

Seems like they could just recalculate the rates like Potomac suggests. Unless they don’t want to give out a big bonus to certain companies

[Hagbard Celine 10897]

7 hours ago, Jiggy-Z said:

Good article from DC Report and links to others on how we got here and the fallout.

https://www.dcreport.org/2021/03/09/texans-why-the-deep-freeze-power-debacle-will-cost-billions/

Spoiler

David Cay Johnston

The pocketbooks of electricity customers across America are under renewed assault by politicians and friends in the electric power generation business.

Unless America restores a sound economic and legal principle that has protected both consumers and electricity companies for more than a century, Texans and the rest of us can expect bigger and bigger electric bills and possibly more ruinous price gouging.

Odds are you haven’t heard that in the news. No one announced it, and most journalism is about covering official announcements. At DCReport we look at facts and decide what we think you need to know. Policies and facts affecting how much you pay for electricity each month are typically news only after a crisis, not as an ongoing news story.

Harsh as Texas is on criminals, it goes all soft and fuzzy when it comes to businesses ripping off millions of people for $550 each.

Regulation of electricity is based on the principle of “just and reasonable” rates. That means consumers pay prices they can afford while investors are assured a reasonable profit, typically a 10% or so return on their assets. Half the states still follow this principle, but half do not.

‘Unjust, Unreasonable’

Texas Gov. Greg Abbott (KXAN screengrab)

This principle is so thoroughly enshrined in American law that courts have held that when a utility earns a single dollar more than earned, the profit is “unjust and unreasonable.”

Texas politicians last week delivered the latest blow to this sound economic principle following the winter freeze debacle that left millions without power and, eventually, water.

Texas electricity producers charged an extra $47 billion during the Feb. 14-19 freeze. Only $10 billion of extra charges were imposed in all of 2020.

It turns out that a third of these extra charges were bogus. Yet amazingly, Texas regulators plan to let power producers keep the $16 billion they improperly overcharged.

$550 for Every Texan

The overcharges average $550 per Texan. Steal that much just once in the Lone Star state and you can get a fine of up $2,000 plus a six-month stay at the local sheriff’s gray-bar hotel.

Harsh as Texas is on criminals, it goes all soft and fuzzy when it comes to businesses ripping off millions of people for $550 each.

The mistake enabling the overcharges was made by the grid operator, the Energy Reliability Council of Texas. Six of the council’s seven members, who do not live in Texas, said they were resigning.

The $16 billion of improper overcharges took place during the final 33 hours, the company that monitors compliance with the Texas rules revealed.  Not correcting this “will result in substantial and unjustified economic harm,” wrote Chris Bivens, a vice president of Potomac Economics, the Texas market monitor.

$9,000 per Megawatt Hour

Ironically, about $1.5 billion of the overcharges were paid to electric generating station owners to produce electricity in freezing weather, according to Potomac Economics.

For those 33 hours producers sold power at the maximum allowable price of $9,000 per megawatt-hour. The average cost of producing each megawatt ranges from roughly $11 to $37 dollars depending on what fuel is used.

During the freezing weather, the costs of generating power did not go up much or at all. But so many power plants shut that those still running were allowed to boost their prices sky-high.

The typical residential customer in America uses electricity by the kilowatt. For a megawatt, a unit 1,000 times greater, the typical residential cost is in the range of $130.

But Texas electricity generators charged almost 75 times that much. Price markups on that scale are so one-sided that the law treats them as unconscionable, and judges often refuse to enforce such contracts.

Too Complicated

Correcting the overcharges would just be too complicated, Arthur C. D’Andrea, the Texas Public Utilities Commission chairman, announced. “It is impossible to unscramble this sort of egg,” D’Andrea said last week.

That’s nonsense. It’s actually easy.

Letting the excess charges stand would also be bad for attracting digital industries to Texas, a major goal of Gov. Greg Abbott. His administration is courting Silicon Valley firms because California housing prices are so high it’s hard to attract young workers. But digital industries require electricity that is both reliably available and predictably priced and Texas just proved it can’t deliver.

Electricity shortages are almost certain to worsen in the next few years, as we reported on Feb. 19.

Evidently, PUC chairman D’Andrea didn’t get the governor’s memo on bringing digital firms to Texas.

Regulation is a dirty word to Abbott and other top Texas officials, Republicans all. But because of its unique nature, electricity regulation is crucial because the modern world runs on it and it is created and used in the same instant.

Electricity is what most distinguishes us from the ancients. People in ancient Athens, Rome and other cities had paved streets, lodging houses, restaurants, retail shops and even resorts. What they lacked were the electrons needed for automobiles and jetliners, night lighting, elevators, refrigerators and computers.

Texans Facing Bankruptcy

Some Texans are faced with depleting their savings, drawing money from their retirement savings, mortgaging their homes or filing for bankruptcy even though they used the same or less power during the freeze as on other days.

The Texas rules, which I’ve warned about for 15 years, are clear, the failure to follow them was blatant and the plan to let producers keep the $16 billion of overcharges is unfair, unnecessary and, if litigated, likely to be found unconscionable.

It’s reasonable to wonder whether the regulators, all political appointees, made a convenient mistake, in effect subtly telling generating plant owners:

“Fellas, stuff your saddlebags with all you can and ride over to the bank with your ill-got gains while we sightless sheriffs take a nap.”

That may sound cynical, but utility regulation is a revolving door everywhere. Commissioners who set electricity rates and grid rules overwhelmingly come from the executive offices at utilities where they return after their stints as public officials. Consumer advocates are as rare as snow in Houston.

The Ghost of Enron

The problem with electricity overcharges extends far beyond Texas, but it began there in the mid-1990s with lobbying by Enron, the fundamentally corrupt energy price manipulator that later went bankrupt.

Enron persuaded the Texas legislature in the mid-1990s to fundamentally change the way electricity is financed and sold. The idea was that while distributing electricity is best done by a monopoly so multiple power lines are not needed everywhere, there’s no natural monopoly in generating power. That’s more than reasonable — on the surface.

Eventually, half the states decided to replace vertically integrated electric utilities which generated, transmitted and distributed electricity. Instead, independent firms would generate power and bid to sell it to distribution companies in so-called single-price auctions.

Enron argued that when there was more demand for power than expected prices would spike and those spikes would attract new investors who would build more power plants and in the long run prices would come down.

‘Single-Price’ Auctions

I’ve yet to meet a businessperson eager to invest in a business where it takes years to go from concept to operation with the expectation that future profits will be smaller than today.

The biggest flaw in the Enron idea, however, is that doing the opposite is faster, cheaper and comes with less risk while virtually guaranteeing fat profits. You can read our DCReport stories here and here as well as here and here.

Enron sold Texas lawmakers on “single price” electricity auctions.

Here’s how a single-price electricity auction works. The grid operator, in this case, the Electric Reliability Council of Texas, calls for bids to supply power for periods that can be as long as a year and as short as a few minutes. Bidders offer to sell power at whatever price they chose.

When bidding closes, everyone whose bid is at or below the price needed to supply all the juice the market needs wins. The winning bidders also get the highest price bid. So even if the average bid was, say, $100, if the highest winning bid was $9,000 then every winner gets the $9,000.

Lose-Lose Deals

That means a hydroelectric dam operator with costs of maybe $120 per megawatt-hour can bid one penny to ensure their bid is a winner and then collect thousands of dollars. So, when they throw open the floodgates to make turbines spin, it’s almost as if greenbacks instead of water flow like Niagara Falls.

What Wall Street investors figured out, as I did, was another flaw in the Enron plan.

Owners of a single power plant must bid low enough to make sure their electricity is purchased, but owners with a fleet of electricity generators can bid strategically to jack up prices.

Experiments with college students, simple bots and actual bidding records showed years ago that this is exactly what happens, as explained my 2007 book, Free Lunch.

There are rules against this kind of manipulation, which is why grid operators hire independent market monitors like Potomac Economics. But some market monitors have been less than diligent while others have had their advice ignored as right now in Texas.

On top of this, in one of his first official actions as president in 2017, Donald Trump signaled to Wall Street that fleet owners were pretty much free to manipulate electricity markets, the subject of the second story DCReport published.

As for unscrambling that egg, the task that Texas PUC Chairman D’Andrea says is too hard, here is one way of several ways to restore fairness.

The Texas PUC can reject charges that exceed the pre-crisis price during those 33 hours. The independent power producers all keep detailed time and price records and can issue revised invoices. They can also sue the state if they want, knowing they risk being tossed out for trying to enforce unconscionable contracts.

Undoing the improper excess charges involves accounting and math but since, unlike the ancients, we have electricity to power computers it’s not all that hard to make the calculations necessary to uphold the just and reasonable principle.

 

[washparkhorn 9939]

2 hours ago, Hagbard Celine said:

David Cay Johnston

He's smart. Respected. He know how to uncover where the bodies are buried and where the money is going. A systems academic on free markets.  His book - Free Lunch - is a good read on inefficient markets.

Straight shooter if looking for efficiency improvements in free markets.  

[washparkhorn 9939]

David Cay Johnston - from the article linked (thank you):

Electricity is what most distinguishes us from the ancients.

People in ancient Athens, Rome and other cities had paved streets, lodging houses, restaurants, retail shops and even resorts.

What they lacked were the electrons needed for automobiles and jetliners, night lighting, elevators, refrigerators and computers.

[LongestHorn 759]

Having a Pulitzer helps.  Great article.

[Hagbard Celine 10897]

13 hours ago, SydneyCarton said:

The generators and mid stream companies need to pay it. Or a huge chunk. 

Neither for or against this, please mansplain me where and how in a law in writing they _were_ required to do this by the regulatory regime created in '99.

[SydneyCarton 48134]

12 minutes ago, Hagbard Celine said:

Neither for or against this, please mansplain me where and how in a law in writing they _were_ required to do this by the regulatory regime created in '99.

They weren't required. Period. It's more egregious that they weren't required after 2011. But you're not going to make the politicians pay personally either, are you? Assigning the correct blame versus what's actually going to happen aren't the same things. 

[cactusflinthead 27601]

 

[cactusflinthead 27601]

 

[cactusflinthead 27601]

 

[Al Bundy's Napoleon Hand 13586]

I guess this morning's drizzle took out the traffic lights on 71.

I keeeed. I think. 

[cactusflinthead 27601]

 

[HenryJames 66135]

letthemfight.gif

[cactusflinthead 27601]

 

[cactusflinthead 27601]

 

[Guest Lobo]

29 minutes ago, cactusflinthead said:

 

Because of the child molestation allegations or something related to regulatory oversight of utilities?  I mean, we could delve into either at this point.