Texas grid vulnerable to blackouts during severe winter weather, even with new preparations, ERCOT estimates show

Electricity outages in Texas could occur this winter if the state experiences a cold snap that forces many power plants offline at the same time as demand for power is high, according to an analysis by the Electric Reliability Council of Texas. The outages could occur despite better preparations by power plants to operate in cold weather.

Heading into the winter, ERCOT considered five extreme scenarios in a risk assessment of the state's power supply. The grid operator estimates both how much electricity Texans are expected to demand and how much electricity power plants are expected to produce ahead of each season.

Following the widespread February power outages that left millions without electricity for several days, ERCOT changed those assessments to calculate what would happen if extreme conditions occurred simultaneously — like what happened this year.

The calculations show the power grid's vulnerability to the cumulative impact of multiple pressures that could leave the system short of a significant amount of power. Power grids must keep supply and demand in balance at all times. When Texas' grid falls below its safety margin of 2,300 megawatts of extra supply, ERCOT, the grid operator, starts taking additional precautions to avoid blackouts, such as asking residents to conserve power.

The calculations for severe risk this winter show that it wouldn't take a storm as bad as the one in February, when hundreds of people died, to take the grid offline.

The most severe scenario considered by ERCOT for this winter — very high demand for power, extensive natural gas and other fossil fuel outages, and excessively low renewable power production — still does not capture the amount of power lost during February. For two days in February, Texas averaged 34,000 megawatts of outages, according to a recent federal report on the crisis. ERCOT's seasonal assessment for this winter estimates that the state, in the worst case scenario, could have only about 10,000 to 19,000 megawatts of total outages at any one time, assuming better preparation by power plants for this winter as opposed to last.

"As part of our comprehensive planning, we also reviewed a number of low-probability, high-impact scenarios," said Chris Schein, a spokesperson for ERCOT, in a statement. "Generators across the state have made improvements in power plant weatherization."

Regulators in October finalized a rule that requires power plants to use "best efforts" to ensure plants can operate this winter and requires them to fix "acute" issues from the February 2021 winter storm.

ERCOT also estimated that Texans would demand, at most, about 73,000 megawatts of electricity at any given time, based on weather from a decade ago in 2011 and economic forecasts for 2020. But during the February power crisis, experts estimate that Texans needed about 77,000 megawatts to keep the power on.

"We've had years of poor planning of peak [demand] by ERCOT," said Alison Silverstein, an expert on Texas' electricity system who formerly worked at the Federal Energy Regulatory Commission and the Public Utility Commission of Texas. She spoke during a public event hosted by the environmental group the Sierra Club on Saturday. "ERCOT's power market has historically been managed to minimize costs, not to assure excellent reliability."

Four of the five extreme risk scenarios ERCOT considered would leave the grid short a significant amount of power, which would trigger outages for residents.

The extreme scenarios have a low chance of occurring, ERCOT emphasises in its report, and the grid operator estimates more power generation will be available than last winter.

Under typical winter grid conditions, the ERCOT report said, there will be sufficient power available to serve the state.

REVEALED: Oil industry helped handpick members of Texas advisory group for electric grid reliability

Oil industry helped handpick members of Texas advisory group for electric grid reliability, emails show

"Oil industry helped handpick members of Texas advisory group for electric grid reliability, emails show" was first published by The Texas Tribune, a nonprofit, nonpartisan media organization that informs Texans — and engages with them — about public policy, politics, government and statewide issues.

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Oil and gas industry groups had a heavy hand in choosing representatives to serve on a council intended to ensure energy and electricity operations continue during extreme weather conditions, emails provided to The Texas Tribune and confirmed by the Texas Railroad Commission show.

The council, recently formalized by the Texas Legislature in the aftermath of the power crisis earlier this year is supposed to ensure the energy and electric industries meet “high priority human needs" and “address critical infrastructure concerns" — responsibilities lawmakers assigned to it after the previous, informal group failed to ensure natural gas suppliers could transport enough fuel to power plants during the February winter storm.

The lack of fuel ultimately forced more electricity offline, lengthening the crisis for Texans, millions of whom lost power, heat and, at times, safe drinking water during the dayslong blackouts. The power outages, primarily caused by the inability of power plants to operate in the extreme cold, caused the deaths of as many as 700 people, according to a BuzzFeed analysis, and caused an estimated $86 billion to $129 billion in economic damage, according to The Perryman Group, a Texas economic firm.

In response, lawmakers beefed up the Texas Energy Reliability Council in Senate Bill 3, a sweeping piece of legislation passed in the aftermath of the storm. The overhaul included formalizing the previously loose group of industry representatives into a 25-member council with regulators to head it, requiring the council to “foster communication and planning" to ensure energy and electricity are prepared to meet Texans' needs, and assigning it a biennial report on the stability of the state's electricity supply.

The revamped council, known as TERC, is composed of electricity, energy and environmental regulators, as well as five participants each from the natural gas supply chain and the electric industry. Those industry representatives are appointed by state regulators, including the Railroad Commission.

An email provided to the Tribune shows that the Texas Oil and Gas Association, one of the most influential oil and gas industry groups in Texas, provided a list of names to the Railroad Commission's executive director for appointment to the council in August. The Railroad Commission of Texas regulates the oil and gas industry.

Two months later, all four of the industry groups' top choices were confirmed to the council by regulators.

Bob Stein, a professor of political science at Rice University and expert on political ethics, said that governments often need and want people from the industry to advise them or serve on boards because of their knowledge of the sector. But he said there should be clear distinctions between industry interests and those of regulators — and rules to ensure the lines aren't blurred.

“We have to be able to appoint people who know something about what they're regulating," Stein said. “But it's all about whose interest are we looking out for: the public or the industry? Who do we really represent?"

A spokesperson for the Railroad Commission said the agency sought assistance from “various associations" because their membership represents all aspects of the natural gas supply chain.

“We vetted recommendations for experience and conducted background checks," Andrew Keese, spokesperson for the Railroad Commission, said in a statement. “RRC believes each of the appointees represent the best mix of experiences and expertise from the natural gas industry."

Industry group went 4-for-4 with its chosen candidates

On Aug. 20, Tulsi Oberbeck, director of government and regulatory affairs for the Texas Oil and Gas Association, emailed Wei Wang, executive director of the Railroad Commission, with a list of names.

“Thank you for the work of the Commission in its efforts to implement the new TERC," Oberbeck wrote, copying several other influential oil and gas industry groups, including the Texas Pipeline Association, the Texas Independent Producers and Royalty Owners Association, and the Texas Alliance of Energy Producers.

“Collectively, we have come together to recommend the attached candidates for possible appointment to the TERC," she wrote.

The list included four “primary" candidates for each market segment position on the council (except for local gas distribution) as well as an alternate candidate.

By contrast, the Public Utility Commission of Texas — charged with appointing market representatives for the electric sector on the council — solicited applications through a public docket. Executive director Thomas Gleeson issued instructions for applicants in mid-September, requiring a letter of interest, qualifications, a resume and a letter of recommendation.

While some industry groups such as the Association of Electric Companies of Texas, a trade organization of electric companies, recommended candidates to the PUCT, not all of its recommendations were chosen, and the agency also received several self-nominations, some of whom were appointed to the council.

The Texas Oil and Gas Association, in a statement, said that the Railroad Commission asked industry groups to provide a joint recommendation for the market appointees because the groups would be best suited to make those recommendations.

“Our criteria for recommendations to the TERC were those who hold a deep understanding of the intricacies of the natural gas system," Oberbeck said through a spokesperson. She said that TXOGA and other oil and gas industry groups held a conference call to discuss recommendations for the council.

“Industry suggesting members who are most familiar with how to make this system work during dire circumstances is not only appropriate, but imperative to ensuring preparedness this winter," Oberbeck said.

The new members recommended by TXOGA and confirmed by the Railroad Commission are Jason Herrick, president of Pantera Energy, an Amarillo-based oil and gas well driller and operator; Grant Ruckel, vice president for government affairs at Energy Transfer, one of the largest natural gas pipeline companies in the U.S.; Daniel Wesson, executive vice president of operations for Diamondback Energy, Inc., an independent upstream oil and gas producer; and Graham Bacon, executive vice president and chief operating officer of Enterprise Products Partners, a large oil and gas pipeline company based in Houston.

The only gas industry representative not recommended to the Railroad Commission by TXOGA is Keith Wall, director of regulatory affairs for southern gas operations at CenterPoint Energy. Wall is on the council to represent local gas distribution companies, often owned by municipalities or electric utility companies.

Consumer advocacy groups said the Railroad Commission's process lacked transparency and fairness, and some of the appointees were affiliated with companies that profited during the winter storm, such as Energy Transfer.

“I think it's really concerning for the people of Texas that all of these financial interests are going to be sitting in a room making decisions for all of us," said Virginia Palacios, executive director of Commission Shift, a newly formed Texas environment and consumer group targeting change at the Railroad Commission. “The people who profited the most from this major disaster are going to be sitting on this [council]."

Agency leaders have ties to industry they regulate

The Railroad Commission has long been criticized for its cozy relationship with the industry it regulates, particularly due to the reported financial interests of its commissioners. Commissioner Christi Craddick and her father, Republican State Rep. Tom Craddick, R-Midland, have consistently reported financial interests in the oil and gas industry in public disclosures. The two fiercely defended the oil and gas industry's role in the February power grid crisis during public legislative hearings.

Railroad Commissioners are elected in statewide, partisan elections, and the majority of their campaigns are funded by oil and gas companies. Texas law does not impose a cap on campaign contributions for statewide office campaigns. In 2013, the Texas Sunset Commission, which evaluates how well state agencies are functioning, recommended changes to the commission's campaign limits, a point that caused a bill to overhaul the Railroad Commission to fail during that session.

A recent report by Commission Shift, the environmental and consumer group, found that Commissioner Craddick reported between $1.5 million to $1.9 million in oil and gas assets, according to an analysis of Craddick's personal disclosures in 2020, but only recused herself from two matters due to a personal or private interest in the last five years. The report found four cases in which Craddick's personal finances “seemed to intertwine with her official duties" and did not recuse herself.

In a response to the report, Commissioner Craddick said she takes state ethics laws seriously.

“My personal financial statements are fully disclosed to the letter of the law and publicly accessible," she wrote through a spokesperson. “Texas Ethics Commission laws ensure transparency of our public officials and maintain the public's trust in our ability to appropriately govern, and I take these laws seriously."

Texas has lax rules around campaign finance and conflicts of interest in government because of the oil and gas industry's influence, said Stein, the Rice professor. He compared it to New York, where similarly lax laws are a result of the highly influential finance industry.

“It's not unique and peculiar to southern states or to red states," he said. “It's peculiar to the dominant industry and economic interest in that state. And we are, as a state, very much dependent on oil and gas and energy."

The Railroad Commission is currently designing rules to designate certain natural gas facilities as “critical," a designation that would help electric utility companies avoid cutting power to important facilities during mandatory power outages, which lengthened the February blackouts.

“Critical" facilities should be able to function during weather emergencies, but some lawmakers are frustrated that natural gas companies may be able to opt out of the proposed requirements if they don't voluntarily declare themselves as “critical" infrastructure — even though the Legislature added that loophole to the legislation. The agency's deadline to adopt the rule is Dec. 1.

Disclosure: The Association of Electric Companies of Texas (AECT), CenterPoint Energy, Rice University, the Texas Alliance of Energy Producers and Texas Pipeline Association have been financial supporters of The Texas Tribune, a nonprofit, nonpartisan news organization that is funded in part by donations from members, foundations and corporate sponsors. Financial supporters play no role in the Tribune's journalism. Find a complete list of them here.

This article originally appeared in The Texas Tribune at https://www.texastribune.org/2021/10/21/texas-railroad-commission-power-grid-council/.

The Texas Tribune is a member-supported, nonpartisan newsroom informing and engaging Texans on state politics and policy. Learn more at texastribune.org.

Texas Republicans seek to punish companies that divest from fossil fuels: report

The Texas House on Monday gave preliminary approval to a bill that would direct state investment funds to divest from companies that cut ties with fossil fuel companies.

Senate Bill 13 was approved on second reading in the House, and needs only a third reading before it is sent to Gov. Greg Abbott's desk.

The legislation would require state entities — including state pension funds and Texas' massive K-12 school endowment — to divest from companies that refuse to invest in or do business with fossil fuel-based energy companies.

It's a response to the sentiment on Wall Street that oil and gas companies are contributing to climate change — and may not be a good investment in the midst of an energy transition. The bill seeks to divest the state's massive investment funds from firms that "boycott" fossil fuel companies.

"Oil and gas is the lifeblood of the Texas economy," state Rep. Phil King, R-Weatherford, said on the House floor before the bill was approved in a 92-51 vote. "In the world of capital, there's a movement to deny funds to businesses that will not sign on to extreme anti-fossil fuel policy."

Pressure is increasing on Wall Street for companies and investment funds to reduce financial support for oil and gas companies due to the outsized impact the industry has on carbon emissions that contribute to climate change. Last year, Larry Fink, founder and chief executive of BlackRock, one of the world's largest investment companies, wrote to shareholders that the firm would make climate change "a defining factor" in its investment strategy.

King said he spoke to an engineer in the energy industry who said the "virtue signaling" by BlackRock has changed capital availability to oil companies.

Democrats who voted no on the legislation called the bill anti-free speech, and argued that Texas should pursue legislation that rewards industries important to Texas, rather than punishing others.

"We say we want to protect people's ability to speak their mind, but once again, we have another bill that does the opposite," said state Rep. Gene Wu, D-Houston. "We punish companies for their thoughts and internal policies, whether they carry them out or not. We punish thought. We punish speech."

Texas state funds identified in the bill include the $46 billion Texas Permanent School Fund, the largest such K-12 fund in the U.S; the Teacher Retirement System of Texas, which manages nearly $165 billion in investments; and the Employees Retirement System of Texas and Texas Municipal Retirement System of Texas, which each manage $31 billion.

An amendment added to the bill on the House floor clarified that the state can do what is in the best interest of the fiduciary duty of the government.

Warren Buffett's Berkshire Hathaway could get a fee from every power customer in Texas: report

As the Texas Legislature debated how to respond to last month's winter storm-driven power crisis, executives at billionaire Warren Buffett's Berkshire Hathaway Energy were pitching lawmakers an idea: The group would spend over $8 billion to build 10 new natural gas power plants in the state. Lawmakers would agree to create a revenue stream to provide Berkshire a return on its investment through an additional charge on Texans' power bills.

Representatives for Berkshire Hathaway Energy have been in Austin meeting with lawmakers and state leaders for the past week and a half, according to a person working closely on the issue.

The proposed company, which would likely be known as the Texas Emergency Power Reserve, would build and maintain plants that sit idle during normal times, according to a slide deck obtained by The Texas Tribune. Whenever demand for power in the state threatened to surpass supply, these new plants would kick in to make up the difference, if ordered to do so by the state's grid operator.

"When you flip that switch and say, look, demand has exceeded supply, it has to come on in 10 minutes," Chris Brown, CEO of Berkshire Hathaway Energy, said in an interview Thursday with the Tribune. "That's the Texas Emergency Power Reserve Promise — that's the promise that we're making to the citizens of Texas."

In the presentation, the representatives estimated the cost of that new charge to consumers as $1.42 per month for residential customers, $9.61 for commercial customers and $58.94 for industrial customers. The pitch to state leaders also included a poll conducted by Republican pollster Mike Baseslice suggesting that Texans would be broadly supportive of paying a little more on their power bills to increase reliability. The poll was conducted from March 17-21 among 800 likely voters in Texas, according to toplines of the poll obtained by the Tribune.

Over the past week, Berkshire Hathaway Energy, part of Buffett's multinational conglomerate company Berkshire Hathaway, has hired eight lobbyists in Austin at a cost of more than $300,000, according to records filed with the Texas Ethics Commission. One of those lobbyists is Allen Blakemore, a Houston political consultant who serves as a top strategist to Lt. Gov. Dan Patrick. Blakemore did not respond to a request for comment.

Executives also met privately with key legislative leaders, including the lieutenant governor, who presides over the Senate, and new House Speaker Dade Phelan, R-Beaumont.

A senior adviser for Patrick confirmed the lieutenant governor met with Berkshire Hathaway executives earlier this month. And a spokesperson for Phelan said the speaker met with the executives recently. A spokesperson for Gov. Greg Abbott, who has so far pushed for the weatherization of power generators as a legislative solution, did not immediately respond to a request for comment.

If approved, the deal would signal a move away from decades of a competitive electricity market in Texas in which all power generators in Texas are paid for the energy they produce and sell, rather than the power they could potentially generate. Berkshire Hathaway Energy executives say their plan would not create a "capacity" market, but instead, serve as highly regulated back-up electricity generation.

The company says that building extra power generation in Texas would help ease fears of a repeat of the February power outages during which dozens of people died.

"We're not in favor at all of getting rid of [the deregulated market]," Brown said. "We think competition is to Texas' benefit. We're not dipping into the market at all."

Power grids must keep energy demand and supply in balance at every moment or risk uncontrolled blackouts. The February outages were ordered by the grid operator, the Electric Reliability Council of Texas, in a move to prevent a bigger catastrophe that could have left most of the state without power for weeks.

Under Berkshire Hathaway's plan, ERCOT would control when the new power plants are activated to avoid the threat of such widespread power outages, and customers would pay a fixed fee only to cover the project's costs, while the price for energy supplied to the market would go to the state, not the company. It's a similar model to how transmission and distribution utility companies are regulated.

Brown said that while the company is not against the state's procurement process, it believes it's "uniquely suited" to carry out the idea because of its $8.3 billion investment and a commitment to have those 10 plants, totaling 10 gigawatts of additional generation capacity, operational by November 2023. Under its proposal, the company would also owe the state $4 billion if it did not have the plants online by then, Brown said.

"Certainly there's other entities out there that could potentially do it," he said, "that list is pretty short."

Texas deregulated its electricity market decades ago, theorizing that the price of electricity in the market — based on demand — would attract a sufficient amount of power supply. When demand for power is high, the price for power increases, and companies that can supply electricity to the grid make more money. The more cheaply a power plant can generate electricity, the higher the profit margin when they sell it in the wholesale market. Conversely, a plant that has been expensively weatherized to be able to operate in the extreme cold, or a plant that only operates on the few hottest days of the year, represents a big upfront investment for what may be little return in Texas.

Other regions of the country, including New England, tackle this potential mismatch by using government funds to subsidize the cost of plants that sit dormant for much of the year but turn on when demand is high. That's the type of plant Berkshire Hathaway Energy wants to build in Texas — but instead, grid operators would decide when the plants ramp up.

Since a deadline to file legislation at the Legislature has already passed, the proposal would likely get tacked onto existing legislation. It was unclear Thursday which specific bill the pitch could be added to if lawmakers decided to act on it, though the company said it was talking with lawmakers about multiple pieces of legislation and working toward getting a committee hearing on the proposal sometime next week.

Texas' competitive and deregulated market structure has come under criticism in the aftermath of the February power crisis. Power companies did not prepare plants to withstand severe winter weather, in part because companies build plants as cheaply as possible to maximize their profit margins. When the plants tripped offline during the winter storm, unprepared for the extreme cold, there wasn't enough power generation available to the grid. Power prices spiked, and the Public Utility Commission of Texas ordered ERCOT to set prices at the artificial cap — $9,000 per megawatt-hour — to signal to power companies that any and all power was desperately needed.

But energy experts have expressed doubt that merely having more power plants would have prevented the crisis. Electric generation tripped offline due to freezing temperatures and a shortage of natural gas, which fuels many plants in the state.

"We didn't have a shortage of power plants, we had a shortage of power plants that could work in the cold, and the gas to run them," said Dan Cohan, an associate professor of civil and environmental engineering at Rice University. "Texas has an enormous amount of natural gas plants already. It's not at all clear that there's a need to have more power plants built."

Berkshire Hathaway's presentation argues that adding power generation capacity would be more cost effective for the state than upgrading existing plants to withstand extreme weather. Brown, the CEO, said that the natural gas plants would be winterized and maintain seven days of natural gas storage on site to ensure it could operate during an emergency.

Lawmakers in recent weeks have quickly moved on legislation to address the February power crisis. Last week, the Texas House State Affairs Committee moved forward a bill that would mandate the weatherization of power plants, or mandate that power plants can function under extreme weather conditions. On Thursday, the Texas Senate Jurisprudence Committee advanced Senate Bill 3, a wide-ranging winter storm bill that also mandates winterization for power plants and the natural gas supply chain.

Another bill and a joint resolution filed in the House by Rep. Dan Huberty, R-Houston, would aid power companies in funding those upgrades. But that legislation, as filed, includes language that would allow the low-cost loan program outlined in the bill to be used for building new power plants as well. It would direct the funds to prioritize projects that prepare facilities for cold weather, but it would also prioritize projects that provide excess power to the grid for periods of high demand — in other words, new power plants.

J.P. Urban, senior vice president and acting CEO of the Association of Electric Companies of Texas, a trade association of electric companies in the state, warned lawmakers earlier this week against subsidizing new power plants in their response to last month's outages.

"We believe the program should only focus on bolstering resiliency and existing facilities to avoid disruption in the competitive market," Urban said during a committee meeting Tuesday.

But lawmakers responded that they want more power generation on Texas' grid, not just for future storms, but generally for the growing state population.

"We're going to be a little bit more open to the types of investments that need to be made," said Rep. Richard Peña Raymond, D-Laredo, responding to Urban. "We're going to need more power in Texas, period. Freeze or no freeze." The committee left the legislation pending on Tuesday, but witnesses and lawmakers indicated they would support the Huberty bill.

Even with the support of the Legislature's top leaders, the Berkshire Hathaway deal will need to win the approval of the rank-and-file members — a lesson Buffett learned in a past session. In 2017, after the billionaire met with Abbott and Patrick at the Capitol, the Senate used emergency powers to quickly craft legislation that became known as the "Buffett Bill," a special interest carve-out allowing Buffett to be exempt from a state law that was barring people from owning both a vehicle manufacturing company and auto dealerships. The bill was effectively killed after Tea Party activists blasted it — and the attempt to fast-track it — as special treatment for a rich and powerful business owner.

Other lawmakers and officials have expressed doubts about letting Buffett and his companies play too big of a role in Texas.

Speaking at Texas Energy Day at the Capitol Wednesday morning, Texas Railroad Commissioner Wayne Christian, one of the state's oil and gas regulators, criticized President Joe Biden over his energy policies and in doing so, swiped at "Warren Buffett's company." Christian said canceling oil and natural gas pipelines would put more trains on railroad tracks, and "Warren Buffett's company makes a lot of money from it."

Mitchell Ferman and Shawn Mulcahy contributed to this report.

California cities banned natural gas in new buildings -- Texas wants to outlaw those bans

Texas lawmakers are quickly moving a bill forward that attempts to stop cities from banning natural gas as a fuel source for new construction and utility services — a trend in progressive California cities that some state lawmakers say would restrict consumer choices if Texas cities move to do the same.

At least a dozen similar bills have been filed in states including Kansas, Minnesota and Ohio. But in Texas, the bill has been pushed as a response to the power outages caused by last month's winter storm.

Now labeled a priority for lawmakers, House Bill 17 would bar cities and municipalities from banning, limiting, restricting or "discriminating" against the type or source of energy used for utility connections. It was included in a slate of bills that the Texas House State Affairs Committee quickly voted out of committee Thursday that are intended to address the storm-related power outages, which left more than 4.8 million people without electricity and killed dozens of people in Texas.

The bill was first filed in January as House Bill 1282. It's sponsor, state Rep. Joe Deshotel, D-Beaumont, said the legislation is a response to "what is happening on the West coast" where cities have passed energy efficiency plans that prohibit new subdivisions from offering natural gas heating, requiring instead that new homes be heated by electricity.

"The purpose of this bill is to prevent a city from prohibiting choice of fuel for homes," Deshotel told the House State Affairs Committee.

Using electricity to heat homes rather than natural gas reduces greenhouse gas emissions. The bulk of emissions from residential and commercial buildings in San Francisco are attributed to burning natural gas, which spurred the city's efforts to mandate a transition, Inside Climate News reported in November. In Austin, the city's initial climate action plan would have virtually eliminated gas use in new buildings by 2030, but was altered after Texas Gas Service opposed the measure, the Texas Observer reported earlier this month.

Elected officials have promoted Deshotel's bill as a response to the trend toward electrifying new home construction, defending the use of natural gas to heat homes and buildings. While visiting Midland in January — where oil and natural gas production dominates the local economy — Gov. Greg Abbott railed against San Francisco's ban and announced his support for legislation that prohibits counties from restricting use of natural gas appliances.

Yet the bill has taken on new prominence in the aftermath of the Texas power outages in February. Deshotel's bill was included in the slate of legislation considered a priority for ensuring the state does not experience such long-lasting and deadly power outages again.

The House State Affairs Committee on Thursday advanced a number of bills responding to the power outages, including one that would require power plants to be upgraded and built for extreme weather events and another that reforms the board of the Electric Reliability Council of Texas, the independent operator of the power grid that covers most of Texas.

Environmental and consumer advocacy groups — which supported the other bills responding to the power outages — opposed House Bill 17, raising concerns that as filed, it could be interpreted to prevent cities from offering rebates and other incentives to encourage use of renewable power generation.

Luke Metzger, executive director of Environment Texas, called the bill "grossly irresponsible." Cyrus Reed, conservation director of the Lone Star Chapter of the Sierra Club, said the bill is too broadly written.

"It makes us nervous that the bill could be used to prevent what we view as good programs happening in cities throughout Texas like rebates for heat pumps or changes in code that encourage electric vehicles," Reed said during the hearing.

Deshotel promised to add an amendment at a later date to address the concerns raised by environmental groups that the language is too broad, reiterating that the bill would not prohibit rebates or other incentive programs for renewable sources of power. Regardless, Reed said Sierra Club would remain opposed because the bill "takes away the rights of local political subdivisions to pursue the actions they'd like to pursue."

Companies that supply natural gas to households voiced their support. Jason Ryan, senior vice president of regulatory services and government affairs at CenterPoint Energy, said at the hearing that the company was "proud" of how its natural gas utilities served customers during the power outages last month, experiencing few disruptions.

Lawmakers agreed, pointing to the ability of natural gas providers to largely continue supplying gas to homes during the February storm. Gas fired furnaces cannot run without power, but some people with gas service were able to use gas fireplaces and stoves.

"A lot of people lost electricity," said State Rep. Chris Paddie, R-Marshall, chair of the committee, "but folks still had that gas going."

During the storm, a supply shortage of natural gas worsened the power outages. While delivery to homes was the first priority, the second priority was to deliver gas to natural gas-fired power plants to generate electricity. However, several electric generation executives testified in hearings last month that their plants were not able to run due to a shortage of fuel. Many plants were also offline due to the cold weather.

That fuel shortage was in part due to increased demand for natural gas during the winter for heating homes, James Cisarik, chairman of the Texas Energy Reliability Council, testified last month.

Ahead of the vote out of committee, some Democratic lawmakers raised concerns about the legislation. Rep. Donna Howard, D-Austin, said her office has received dozens of emails about House Bill 17 — all opposed.

Deshotel responded that there has been "misinformation" about the bill. "I understand [the] people calling you and complaining," he said, referring to news coverage and statements from environmental groups characterizing the bill as a handout to the natural gas industry.

"I would be calling too, and saying, 'Is this guy crazy?'" he said. "But you know, that's not what this bill does. So, I'm certainly willing to work with all the parties here. It's not about forcing anything on anybody."

Disclosure: CenterPoint Energy and Texas Gas Service have been financial supporters of The Texas Tribune, a nonprofit, nonpartisan news organization that is funded in part by donations from members, foundations and corporate sponsors. Financial supporters play no role in the Tribune's journalism. Find a complete list of them here.

Fired Texas power leader refuses more than $800,000 severance pay in storm aftermath

Bill Magness, the Electric Reliability Council of Texas CEO who was terminated by his board Wednesday, said he will not seek or accept severance pay, according to a spokesperson. He would have been owed more than $800,000, his contract shows.

The board for the nonprofit entity that operates and manages the electricity grid that covers much of Texas voted Wednesday in favor of his 60-day termination notice.

Magness was terminated without cause, a spokesperson said. According to the terms of his employment contract, his severance pay would have been equivalent to one year of his current base salary, which is more than $800,000.

Both ERCOT and the Public Utility Commission of Texas, the regulatory body that oversees it, have been lambasted in recent weeks for failures in preparing for and responding to the winter storm that left millions of people in the dark for days and claimed the lives of dozens of Texans.

On Monday, Lt. Gov. Dan Patrick called for both Magness and the chair of the PUC to resign. DeAnn Walker, the former chairwoman for the PUC, resigned that day. She had come under sharp criticism from lawmakers after largely blaming Texas' power outages on ERCOT.

Gov. Greg Abbott on Wednesday named Walker's replacement.

Magness, who endured more than five hours of questioning by state senators on Thursday, was criticized for the organization's winter storm preparations.

Magness worked at ERCOT for more than a decade and became its CEO and president in 2016 after working as its general counsel. He previously held executive management positions in the public and private utility sectors.


Texas overcharged power companies $16 billion for electricity during winter storm: report

The Electric Reliability Council of Texas made a $16 billion error in pricing during the week of the winter storm that caused power outages across the state, according to a filing by its market monitor.

Potomac Economics, the independent market monitor for the Public Utility Commission of Texas, which oversees ERCOT, wrote in a letter to the Public Utility Commission that ERCOT kept market prices for power too high for nearly two days after widespread outages ended late the night of Feb. 17. It should have reset the prices the following day.

That decision to keep prices high, the market monitor described, resulted in $16 billion in additional costs to Texas power companies. The news of the overcharging was first reported by Bloomberg.

In Texas, wholesale power prices are determined by supply and demand: When demand is high, ERCOT allows prices to go up. During the storm, PUC directed the grid operator to set wholesale power prices at $9,000 per megawatt hour — the maximum price. Raising prices is intended to incentivize power generators in the state to add more power to the grid. Companies then buy power from the wholesale market to deliver to consumers, which they are contractually obligated to do.

Because ERCOT failed to bring prices back down on time, companies had to buy power in the market at inflated prices.

The error will likely result in higher levels of defaults, wrote Carrie Bivens, a vice president of Potomac Economics, the firm that monitors the grid operator. She said the PUC should direct ERCOT to remove the pricing interventions that occurred after outages ended, and allowing them to remain would result in "substantial and unjustified" economic harm.

Retail power providers have been in financial distress across Texas since the storm; many were forced to buy power on the wholesale market at extremely high prices.

Brazos Electric Power Cooperative Inc., Texas' largest power cooperative, has already filed for bankruptcy protection after incurring $2.1 billion in combined charges owed to ERCOT, according to court documents filed Monday.

Many retail power providers complained in filings to regulators that generators of electricity, which were unable to produce enough power during the storm, profited and left retail companies scrambling.

"The ERCOT market was not designed to deal with an emergency of this scale," wrote Patrick Woodson, CEO of ATG Clean Energy Holdings, a retail power provider based in Austin, to the Public Utility Commission. The pricing failure, he wrote, "has pushed the entire market to the brink of collapse."

Bivens wrote that while she recognizes that retroactively revising the prices is "not ideal," correcting the error will reflect the accurate supply and demand for power during the period after the outages.

The recommendation "will not result [in] any revenue shortfalls for ERCOT's generation as the corrected prices will cover the generator's as-offered costs," she wrote. "We recognize that revising the prices retroactively is not ideal."

A spokesperson for ERCOT was not immediately available to comment.

Kenan Ogelman, the ERCOT vice president of commercial operations, who testified during a Texas Senate committee hearing Thursday, was not asked by state senators about ERCOT's $16 billion mistake. Sen. Kelly Hancock, R-North Richland Hills, who chairs the Business and Commerce committee, did not indicate what action he or other senators would take on the various financial ripple effects from the winter storm.

"There are financial concerns — let's put it that way — that we have to address," Hancock said.

Reese Oxner and Shannon Najmabadi contributed to this report.

Texas was 'seconds and minutes' away from catastrophic months-long blackouts: officials

Texas' power grid was “seconds and minutes" away from a catastrophic failure that could have left Texans in the dark for months, officials with the entity that operates the grid said Thursday.

As millions of customers throughout the state begin to have power restored after days of massive blackouts, officials with the Electric Reliability Council of Texas, or ERCOT, which operates the power grid that covers most of the state, said Texas was dangerously close to a worst-case scenario: uncontrolled blackouts across the state.

The quick decision that grid operators made in the early hours of Monday morning to begin what was intended to be rolling blackouts — but lasted days for millions of Texans — occurred because operators were seeing warning signs that massive amounts of energy supply was dropping off the grid.

As natural gas fired plants, utility scale wind power and coal plants tripped offline due to the extreme cold brought by the winter storm, the amount of power supplied to the grid to be distributed across the state fell rapidly. At the same time, demand was increasing as consumers and businesses turned up the heat and stayed inside to avoid the weather.

“It needed to be addressed immediately," said Bill Magness, president of ERCOT. “It was seconds and minutes [from possible failure] given the amount of generation that was coming off the system."

Grid operators had to act quickly to cut the amount of power distributed, Magness said, because if they had waited, “then what happens in that next minute might be that three more [power generation] units come offline, and then you're sunk."

Magness said on Wednesday that if operators had not acted in that moment, the state could have suffered blackouts that “could have occurred for months," and left Texas in an “indeterminately long" crisis.

While generators rapidly dropped off the grid as the weather worsened, operators monitored the difference between the supply of power on the grid and the demand for that power. As supply dwindled and demand grew, the margin narrowed to more and more dangerous levels, forcing grid operators to enact emergency protocols to either increase supply or decrease demand.

The worst case scenario: Demand for power outstrips the supply of power generation available on the grid, causing equipment to catch fire, substations to blow and power lines to go down.

If the grid had gone totally offline, the physical damage to power infrastructure from overwhelming the grid could have taken months to repair, said Bernadette Johnson, senior vice president of power and renewables at Enverus, an oil and gas software and information company headquartered in Austin.

“As chaotic as it was, the whole grid could've been in blackout," she said. “ERCOT is getting a lot of heat, but the fact that it wasn't worse is because of those grid operators."

ERCOT has three emergency procedures to balance the equation between supply and demand. Grid operators can call on other grids for help — Texas' grid has limited connections to the eastern U.S. and Mexico. But in this week's storm, so much power went offline that other grids couldn't close the gap, in part because those grids were being stressed by the same storm.

Next, ERCOT can try to reduce demand by interrupting power to large industrial customers that have previously agreed to have power cut during an emergency.

If that doesn't work — and it didn't in this case — ERCOT has a last resort option: ordering transmission companies to reduce demand on the system with rotating outages for customers.

That's what happened in the early hours of Monday morning.

Usually, those outages are limited to less than 45 minutes. But this week, the outages lasted days. That's likely because after ERCOT ordered companies to stop providing power to customers, even more power generation tripped offline, and it was not able to “roll" the outages effectively, Johnson explained.

The amount of power ERCOT needed utilities to cut back in order to prevent complete blackout was so great that the companies didn't have flexibility to roll power from one area to another to spread out the pain.

The emergency procedures are designed to avoid overwhelming the entire Texas grid. If that had occurred, even as power generators recovered from the cold, ERCOT would have been unable to quickly reconnect them back to the grid, Johnson said.

Grid operators would have needed to slowly and carefully bring generators and customers back online, all the while taking care to not to cause more damage to the grid. It's a delicate process, Johnson explained, because each part of the puzzle — the generators producing power, the transmission lines that move the power and the customers that use it — must be carefully managed.

“It has to balance constantly," she said. “Once a grid goes down, it's hard to bring it back online. If you bring on too many customers, then you have another outage."

ERCOT officials have repeatedly said that the winter storm that swept the state caught power generators off guard, and that it previously appeared there was more than enough supply to meet demand. But the storm far exceeded what ERCOT projected in the fall to prepare for winter.

“The operators who took those actions to prevent a catastrophic blackout and much worse damage to our system, that was, I would say, the most difficult decision that had to be made throughout this whole event," Magness said.

Nine grid operators are working at any given time who make these sorts of decisions, said Leslie Sopko, a spokesperson for ERCOT.

“At the end of the day, our operators are highly trained and have the authority to make decisions that protect the reliability of the electric system," she said in a statement.

ERCOT made “significant progress" overnight Wednesday to restore customer power to many Texans, and remaining power outages are likely due to ice storm damage to the distribution system. Some areas that were taken offline will also need to be restored manually, according to ERCOT.

ERCOT warned that emergency conditions remain, and that “some level of rotating outages" may be necessary over the coming days to keep the grid stable.

This article originally appeared in The Texas Tribune at https://www.texastribune.org/2021/02/18/texas-power-outages-ercot/.

The Texas Tribune is a member-supported, nonpartisan newsroom informing and engaging Texans on state politics and policy. Learn more at texastribune.org.

Texas largely relies on natural gas for power — it wasn’t ready for the extreme cold

Failures across Texas' natural gas operations and supply chains due to extreme temperatures are the most significant cause of the power crisis that has left millions of Texans without heat and electricity during the winter storm sweeping the U.S.

From frozen natural gas wells to frozen wind turbines, all sources of power generation have faced difficulties during the winter storm. But Texans largely rely on natural gas for power and heat generation, especially during peak usage, experts said.

Officials for the Electric Reliability Council of Texas, or ERCOT, which manages most of Texas' grid, said that the primary cause of the outages on Tuesday appeared to be the state's natural gas providers. Many are not designed to withstand such low temperatures on equipment or during production.

By some estimates, nearly half of the state's natural gas production has screeched to a halt due to the extremely low temperatures, while freezing components at natural gas-fired power plants have forced some operators to shut down.

"Texas is a gas state," said Michael Webber, an energy resources professor at the University of Texas at Austin. While he said all of Texas' energy sources share blame for the power crisis at least one nuclear power plant has partially shut down, most notably the natural gas industry is producing significantly less power than normal.

"Gas is failing in the most spectacular fashion right now," Webber said.

More than half of ERCOT's winter generating capacity, largely powered by natural gas, was offline due to the storm, an estimated 45 gigawatts, according to Dan Woodfin, a senior director at ERCOT.

The outages during this storm far exceeded what ERCOT had predicted in November for an extreme winter event. The forecast for peak demand was 67 gigawatts; peak usage during the storm was more than 69 gigawatts on Sunday.

It's estimated that about 80% of the grid's capacity, or 67 gigawatts, could be generated by natural gas, coal and some nuclear power. Only 7% of ERCOT's forecasted winter capacity, or six gigawatts, was expected to come from various wind power sources across the state.

Woodfin said Tuesday that 16 gigawatts of renewable energy generation, mostly wind generation, is offline and that 30 gigawatts of thermal sources, which includes gas, coal and nuclear energy, is offline.

"It appears that a lot of the generation that has gone offline today has been primarily due to issues on the natural gas system," Woodfin said during a Tuesday call with reporters.

Production of natural gas in the state has plunged, making it difficult for power plants to get the fuel necessary to run the plants. Natural gas power plants usually don't have very much fuel storage on site, experts said. Instead, the plants rely on the constant flow of natural gas from pipelines that run across the state from areas like the Permian Basin in West Texas to major demand centers like Houston and Dallas.

In early February, Texas operators were producing about 24 billion cubic feet per day, according to an estimate by S&P Global Platts. But Monday, Texas production plummeted to a fraction of that: Operators in the state produced somewhere between 12 and 17 billion cubic feet per day.

The systems that get gas from the earth aren't properly built for cold weather. Operators in West Texas' Permian Basin, one of the most productive oil fields in the world, are particularly struggling to bring natural gas to the surface, analysts said, as cold weather and snow close wells or cause power outages that prevent pumping the fossil fuels from the ground.

"Gathering lines freeze, and the wells get so cold that they can't produce," said Parker Fawcett, a natural gas analyst for S&P Global Platts. "And, pumps use electricity, so they're not even able to lift that gas and liquid, because there's no power to produce."

Texas does not have as much storage capacity as other states, experts said, because the resource-laden state can easily pull it from the ground when it's needed — usually.

Of the storage that the state does have, the resources are somewhat difficult to get to. Luke Jackson, another natural gas analyst for S&P Global Platts, said that physically withdrawing stored natural gas is slower than the immediate, ready supply of lines from production and is insufficient to make up for the dramatic declines in production.

Some power plants were already offline before the crisis began, adding to the problems, experts said. ERCOT anticipated four gigawatts of maintenance outages during the winter. Power plants in Texas usually do maintenance and updates to their plants during the typically mild winter months in preparation for the extreme electricity and power demand during the summer. That too, is straining the grid's supply.

Another winter problem: Heating homes and hospitals by burning natural gas.

"In the summer, you don't have as much direct burning of natural gas," said Daniel Cohan, an associate professor of civil and environmental engineering at Rice University, pointing out that during peak usage during the summer months, the demand is all for electricity.

The last time the state experienced a major freeze like this was a decade ago in 2011. At that time, too, natural gas generation experienced difficulties — had ERCOT not reduced load through the rolling blackouts implemented during that storm, it would have resulted in widespread blackouts throughout the entire region, a federal report on the storm warned.

It is possible to "winterize" natural gas power plants, natural gas production and wind turbines, experts said, which prevent such major interruptions in other states with more regular extreme winter weather. But even after upgrades were made following the 2011 winter storm, many Texas power generators have still not made all the investments necessary to prevent the sort of disruptions happening to the equipment, experts said.

ERCOT directors also said that the storm this week took a turn in the early morning hours of Monday, when extremely low temperatures forced many more generators offline than ERCOT had anticipated.

"It appeared that the winterization we were doing was working, but this weather was more extreme than (past storms)," Woodfin said. "The loss of generation during the morning of Monday, after midnight, was really the part that made this a more extreme event than we had planned."

Upgrading equipment to withstand extremely low temperatures and other changes, such as providing incentives for customers to conserve power or upgrade to smart appliances, could help avoid disasters like this one, said Le Xie, a professor of Electrical and Computer Engineering at Texas A&M University and assistant director of energy digitization at A&M's Energy Institute.

"We used to not worry too much about such extreme cold weather in places like Texas, but we probably need to get ready for more in the future," Xie said. With climate change, he said, "We're going to have more extreme weather conditions throughout the country."

West Texas is on track to get even more nuclear waste — thanks to the federal government

To get rid of eight gallons of water, the U.S. Department of Energy spent $100,000.

It's little more than half a tank of gasoline in a midsize car, but the radioactive shipment from South Carolina to a West Texas company last fall marked one change that could lead to more nuclear waste traveling to Texas — waste that, until recently, was considered too dangerous to be disposed of.

Much of the public debate surrounding Waste Control Specialists' hazardous waste facility in Andrews County, on the New Mexico border, has focused on the company's plans, with a partner, to store the riskiest type of nuclear waste: the spent fuel rods from nuclear power plants, which can remain dangerously radioactive for hundreds of thousands of years.

Scientists agree that spent nuclear fuel should be stored deep underground, but the U.S. still hasn't located a suitable site. Interim Storage Partners — a joint venture of Waste Control Specialists and Orano USA, a subsidiary of one of the world's biggest nuclear power companies — proposed bringing the spent fuel to a 332-acre site next to the WCS facility in Andrews County until a permanent storage site is found.

If the plan succeeds, it would be a big expansion for Waste Control Specialists, which has been disposing of the nation's low-level nuclear waste — including tools, building materials and protective clothing exposed to radioactivity — for a decade. Interim Storage Partners' website says it expects to get the federal approval for spent nuclear fuel storage, a major step in the plan, this year.

The idea still faces significant legal hurdles and stiff opposition from environmental groups, local oil companies, some residents and Texas Gov. Greg Abbott, who wrote to federal regulators last year asking them to deny the license application, stating that the proposal presents a "greater radiological risk than Texas is prepared to allow."

The federal government and the companies involved say radioactive spills during transportation or storage that expose people or the environment to radiation are very unlikely to occur, but opponents fear human error, mechanical failures or geological changes could result in groundwater contamination.

But while the slow-moving plan is wrapped in political turmoil, lower-profile changes and proposals from federal agencies are giving Waste Control Specialists another avenue to accept more radioactive waste than it does today.

The wastewater that traveled from an old South Carolina nuclear weapons facility more than 1,000 miles in three truckloads in late September was an example: It was the first shipment made after a 2019 U.S. Department of Energy decision to reinterpret how different levels of radioactive waste are classified, allowing it to be disposed of at a commercial facility.

The decision lets the DOE categorize waste based on its properties and hazard level rather than how it was created, and allows radioactive waste from nuclear weapons production and government-sponsored nuclear energy research to be shipped to commercial sites such as the one in Texas, rather than indefinitely stored at a government site.

"They did this eight gallons as a sort of test," said Tom Clements, the director of Savannah River Site Watch, an advocacy group that monitors the DOE's site in South Carolina, a nuclear national security complex where materials for nuclear weapons were produced until 1991 at the end of the Cold War. "It is the foot in the door to taking more material to WCS."

And the federal Nuclear Regulatory Commission is also considering new rules that could give Waste Control Specialists a green light to pursue bringing more dangerous radioactive waste to its commercial facility than currently allowed by state law.

The company is already permitted to accept low-level nuclear waste in Andrews County. The plan to build a facility to store spent nuclear fuel, the most dangerous kind, would bring what's considered high-level nuclear waste. In addition, NRC staff recommended in October that the agency consider allowing commercial facilities like WCS to accept materials that fall into a third danger level between those two categories.

"The floodgates may be opening [in Texas]," Clements said.

That's exactly what many environmentalists and local opponents feared after the hazardous waste facility was built in 1995. At the time, a company official told the community that it had no plans to expand to radioactive waste disposal.

"This is one of the difficulties of a community or state agreeing to one type of waste facility, because it can be changed on you," said Rodney Ewing, a scientist and professor in nuclear security at Stanford University. "If it's judged to be safe, that becomes the rationale for accepting more waste."

Waste Control Specialists and Interim Storage Partners executives repeatedly declined, through a spokesperson, to provide interviews or comment for this story, referring instead to company fact sheets. On their websites, the companies emphasize their commitment to safety and the environment. WCS states on a media sheet that the company "has an extensive monitoring program to ensure the safety of the community and the environment at all times."

Nuclear debate in Texas

The nuclear power industry prides itself on operating no-emissions plants without burning fossil fuels like coal and natural gas, which create the greenhouse gas emissions that contribute to climate change. By locating in the Permian Basin, one of the most productive oil fields in the world, Waste Control Specialists has found itself in a political fight against fossil fuel interests that its customers often compete with.

Elaine Magruder is co-owner of an Andrews County ranch where her family has raised cattle and pumped oil since 1893. She's also a member of a coalition of Permian Basin landowners and oil and gas operators that oppose radioactive waste storage and disposal in Andrews County. The coalition is led by Fasken Oil and Ranch, which owns thousands of acres in Andrews County.

Magruder says she's worried that a transportation accident could expose local residents to radioactive material and disrupt oil and gas operations. She also worries that a leak at the facility could allow radioactive material to seep into the ground, contaminating area drinking water. The facility is near the Ogallala Aquifer of the Great Plains, which provides drinking water for millions in the West.

"[The oil and gas] industry has supported our families and communities for all this time," Magruder said. "What has to be considered is short-term economic gain for long-term disastrous risk. It has the risk of harming our whole Permian Basin area."

But Andrews County Judge Charlie Falcon said he supports the facility's expansion plans. He believes the majority of the county's 18,700 residents don't object to Waste Control Specialists' operation, which employs 110 people and pumps around $1 million annually into the county's coffers through a 5% fee on all disposal activities — an amount that would likely increase if the facility is allowed to accept more radioactive waste. WCS has paid $13.4 million in fees to Andrews County since 2012. Another $59.3 million has gone to the state.

"Most people do not have a problem with the waste facility out there," Falcon said. "WCS, the company, they are great corporate partners with the county and the schools. They do their part."

A Department of Energy review of nuclear waste shipments worldwide found that there have been few transportation accidents involving spent nuclear fuel — and most were minor, according to the analysis. And as for other radioactive waste, the DOE, in a statement, said it safely ships hazardous waste via routes that minimize radiological risk.

The Nuclear Regulatory Commission also found in a 2014 assessment that federal regulations are adequate to ensure public safety during transportation of nuclear waste and that the chance of a radioactive release during an accident is very small.

Ewing, the Stanford University nuclear security professor, said the larger risk is environmental contamination due to the facility's proximity to the aquifer — a concern shared by some other nuclear scientists and geologists.

This unlikely alliance of environmental groups and oil companies has Abbott on its side. In November, the governor sent a letter urging the Nuclear Regulatory Commission to deny the application for storing spent nuclear fuel in Andrews County, arguing in part that the proposed facility "imperils America's energy security" by making the region an even greater possible terrorism target than it is today due to its oil and gas reserves.

Waste Control Specialists and its partners point to the area's geological characteristics as the primary reason why the site is one of the safest places in the nation to put nuclear waste. The facility sits atop an impermeable 600-foot-thick red clay formation, and according to a Department of Energy environmental assessment, the hazardous and radioactive waste is buried in the clay and "encapsulated in a robust liner and cover system" to prevent leaks or spills.

Falcon, the county judge, said he sees radioactive waste as a buffer against the inevitable ups and downs of the cyclical oil and gas industry.

"If that is to dry up and go away, especially with a new administration that opposes oil and gas, we don't have a whole lot of resources here for economic diversification," he said.

Radioactivity in West Texas

Waste Control Specialists' nuclear waste pursuit was the brainchild of now-deceased Dallas billionaire Harold Simmons, who slowly took over the company in the early 2000s as he became more invested in what was then a small hazardous waste disposal business in Andrews County.

Long before Simmons' takeover, a Waste Control Specialists official was quoted in the Andrews County News in 1993 stating that the facility "would not take radioactive materials, nuclear waste, medical wastes, explosives or any liquids."

But the company's new owner soon began lobbying the Texas Legislature for permission to accept low-level nuclear waste at the facility. Simmons had clout at the Capitol: He was a major donor to then-Gov. Rick Perry. Even so, getting the permits for low-level nuclear waste, which typically includes a wide range of contaminated items such as radioactive gloves, shoe covers and medical tubes, took years of political maneuvering.

First, the Texas Legislature passed a bill making it legal for private companies to dispose of low-level nuclear waste in Texas — a bill that Perry signed into law in 2003. That sparked an intense effort to block the plans for low-level nuclear waste at the site by environmental groups and landowners who raised concerns over water contamination, transportation accidents and increased terrorist threat to the region.

Glenn Shankle, then the executive director of the Texas Commission on Environmental Quality, recommended the site be permitted to dispose of lower-level nuclear waste — defying some of the agency's scientists who said nearby groundwater could be at risk.

A few TCEQ staff members resigned over the nuclear waste proposal, among them Patricia Bobeck, a geologist who said she was pressured by higher-ups to find a way to approve the permit, despite her professional opinion that the geology of the area was at a high risk of erosion — which could increase the chance of environmental contamination. Bobeck said she retired from government rather than "have that permit shoved down my throat."

The director, Shankle, later took a job as a lobbyist for Waste Control Specialists.

Today, Elizabeth Padilla, a school teacher in Andrews and mother of four who opposes the facility because she worries it could pose health risks to her family, points to the 1993 Andrews County News article as proof of what she calls a broken promise to the community.

"The people of Andrews gave them an inch, and they're wanting to take miles and miles," said Padilla. "They just can't have enough."

A new interpretation

Even after getting permission to expand into nuclear waste, the company had high costs and not enough demand. Some nuclear energy industry experts theorized that expensive commercial nuclear waste facilities like WCS overestimated the amount of low-level nuclear waste that would need disposal as power plant operators became more efficient.

Simmons died in 2013, and WCS, in financial distress, was acquired in 2018 by J.F. Lehman & Co., a New York private equity firm that specializes in defense, maritime, environment and government industries.

By then, Donald Trump had become president and tapped Perry to head the Department of Energy, which is charged with finding a long-term solution to the nation's high-level nuclear waste — much of it stored across the nation on site at the power plants where it was created and at DOE sites, for lack of anywhere else to put it.

In 2019, the DOE reinterpreted how it classified different levels of nuclear waste, basing each level on radioactivity and risk rather than by how it was created. It was a change that experts convened by the Secretary of Energy recommended in order to modernize the nation's nuclear waste disposal process.

For example, some high-level waste was classified that way because it was created during weapons production, not because it is as long-lasting or dangerous as spent nuclear fuel. By reclassifying some of the government's nuclear waste to a lower level, the DOE could move it to commercial facilities for disposal — including WCS' Texas facility — and save the federal government more than $200 billion in waste storage and maintenance costs, the DOE estimated in a December report to Congress.

Not everyone agreed with the new interpretation. The state of Washington, which has tangled with the federal government for years over contamination from a decommissioned nuclear complex, opposed the reinterpretation, concerned that the federal government would erroneously label dangerous waste as low level. Others criticized the DOE for failing to publicly reveal how much waste would be reclassified.

"They didn't describe how much waste there would be, or how they would handle it," said Don Hancock, an attorney and director of the Nuclear Waste Safety Program at the Southwest Research and Information Center in Albuquerque, New Mexico. "My expectation is that DOE itself doesn't know exactly how much is in South Carolina that it wants to send to WCS."

The DOE did not provide an estimate of how much waste the new interpretation would apply to, but stated that no decisions on implementation have been made beyond that eight-gallon shipment to Texas.

The agency said using the new classifications for the waste "enables the Department to better address one of our Nation's largest environmental challenges" by allowing waste that has been stored at DOE sites for decades a new path for disposal.

"It's not cotton candy"

Meanwhile, the Nuclear Regulatory Commission may soon consider new regulations that would allow WCS and other commercial sites to accept a higher level of nuclear waste than Texas currently allows.

The WCS facility is permitted to accept Class A, B, and C nuclear waste — categories that fall below high-level material like spent nuclear fuel. But certain material, much of it generated by the decommissioning of nuclear power plants, falls into what experts call a gray area between the lower-level categories and spent nuclear fuel. It has an equally ambiguous name: "Greater than Class C."

The waste represents an opportunity for disposal companies, industry observers said, as more nuclear power plants are decommissioned in favor of cheaper natural gas power plants or renewable sources like wind and solar.

The "Greater than Class C" waste is currently considered "high level," meaning it can only be slated for the ultra-secure underground storage in a permanent repository that the U.S. government has yet to create. In the meantime, it's mostly stored where it was created.

But a 2014 request by Waste Control Specialists set off a discussion at the NRC on whether new guidelines for the "Greater than Class C" waste should be created. Because Texas law prevents commercial sites from accepting it, WCS asked state regulators to change the rules. The TCEQ needed to clarify with the federal government whether it was even allowed to regulate such high-level materials; now, the NRC is looking at the possibility.

NRC staff recommended in October that the commission consider rules to allow commercial sites to accept this category of waste, concluding that 80% of the "Greater than Class C" waste could be safely disposed of at facilities like WCS' rather than deep underground. Staff wrote that the rule would provide a quicker solution to waste otherwise trapped on site, waiting for a permanent home that has yet to materialize, and that the materials are "not so hazardous" that they should only be managed by the federal government.

Some experts, however, are skeptical of changing the rules. Bob Alvarez, a nuclear waste expert and senior scholar at the Institute for Policy Studies, said he believes this category of waste is dangerous enough for long enough that it should be isolated in a geologic repository like the proposed Yucca Mountain facility in Nevada.

"These are some of the most dangerous materials in the world," Alvarez said. "It's not cotton candy."

But even if NRC commissioners change rules to allow state-level oversight, it may not help WCS advance its plans. Abbott is opposed to bringing the "Greater than Class C" waste to Texas, according to his letter to the NRC. David McIntyre, a spokesperson for the NRC, said it's not clear when agency commissioners will make a decision on the staff's recommendations.

Opponents of the proposal say, either way, the company's efforts to get permission to handle the waste represents another attempt to boost its profits by taking more dangerous waste.

"[It's] an effort over many years to make it look less threatening, and to sneak it in as less hazardous," said Karen Hadden, the executive director of the Sustainable Energy and Economic Development Coalition, a sustainable energy alliance of businesses and organizations. "[Waste Control Specialists] continues down this path of ever expanding their radioactive empire."

Why the NRA is really filing for bankruptcy and moving to Texas

The National Rifle Association filed Chapter 11 bankruptcy Friday and said it would eventually reincorporate in Texas — a move experts say is a legal maneuver to escape an aggressive lawsuit being pursued by the New York attorney general.

Officials in Texas — which is known as both a gun-friendly and debtor-friendly state — welcomed the NRA's announcement Friday, embracing the NRA's stance that it is fleeing a "toxic political environment" in New York.

In August, New York's attorney general filed a lawsuit against the organization alleging decades of fraudulent use of the NRA's funds by its executives. New York Attorney General Letitia James accused NRA leaders of knowingly signing off on fraudulent statements.

Texas Gov. Greg Abbott, in a tweet, celebrated the announcement: "Welcome to Texas — a state that safeguards the 2nd Amendment." Other conservative Texas lawmakers also welcomed the news.

But bankruptcy experts said the NRA's filing is less of a physical relocation and more of a legal play to avoid a potentially disastrous case in New York.

The move to Texas, legal experts said, will likely be on paper.

"They probably figured they'd have a more friendly judge in Texas," said Josh Wolfshohl, a bankruptcy attorney at Porter Hedges LLP in Houston.

"They're trying to do a preemptive strike" against New York, said Sidney Scheinberg, a bankruptcy attorney at Godwin Bowman PC in Dallas. "It's a clever maneuver. Whether it's going to work, I don't know."

Filing for Chapter 11 bankruptcy pauses pending litigation, and the New York attorney general's case will now be battled in a Dallas bankruptcy court instead of a civil court in New York.

"I suspect the NRA's plan is to consolidate pending litigation in the bankruptcy court," said Kevin Lippman, a bankruptcy attorney at the Texas-based Munsch Hardt Kopf & Harr PC law firm. But, he said, New York could challenge the move and try to bring the case back.

Texas also has one of the most generous homestead exemptions in the country. NRA executives who might receive judgments against them stemming from the New York suit could feasibly move to Texas, "buy a very nice home, and no one could ever take it away from them," Scheinberg said.

The NRA said it would seek to reincorporate in Texas, pending court approval. While it was chartered in New York, the organization's headquarters and much of its operations are in Fairfax, Virginia.

"There will be no immediate changes to the NRA's operations or workforce," the NRA said in a statement.

Nevertheless, Texas politicians jumped on the move as proof that Texas is attracting new businesses and organizations due to its business-friendly regulatory environment.

"Welcome to Texas," state Sen. Dawn Buckingham, R-Lakeway, wrote in a tweet tagging the NRA. "Unlike New York, we protect and uphold our citizens' right to bear arms."

"This is a wonderful place for [the NRA] both financially and for our community," said Andi Turner, legislative director for the Texas State Rifle Association.

Texas Democrats, meanwhile, criticized the move. U.S. Rep. Veronica Escobar, D-El Paso, criticized Abbott for "courting" the NRA "instead of taking meaningful actions to reduce gun violence in Texas."

The NRA emphasized in its statements Friday that it was not in financial trouble and focused on political reasons for leaving New York.

The NRA listed between $100 million and $500 million in liabilities, the same range it reported for its assets, in its filing. The organization claimed in its press statements it is in its "strongest financial condition" in years.

"The NRA is not insolvent," the group said in a statement. "This action is necessitated primarily by one thing: the unhinged and political attack against the NRA by the New York Attorney General."

But while experts said organizations file for Chapter 11 bankruptcy for a variety of reasons, typically there is some sort of financial cause — otherwise, the courts may toss out the case.

"Very rarely do [organizations] file when they're not in financial trouble," said Josh Wolfshohl, a bankruptcy attorney at Porter Hedges LLP in Houston. "Partly because of the stigma, and also, it's expensive."

Beyond the costly litigation, filing for bankruptcy can also put funding for nonprofits like the NRA in jeopardy, because donors might become concerned that the organization will use their money to pay claims instead of, for example, using it to protect gun owners' rights.

"I don't think it was their first choice to file bankruptcy, because typically it will impact their fundraising," Lippman said.

Texas bankruptcy attorneys theorized that perhaps the NRA decided it needed to file bankruptcy to move the New York lawsuit and decided Texas would be the friendliest place to do it.

"The government is welcoming them here, while the New York attorney general is doing everything in her power to put them out of business," Scheinberg said. And while the political tide may be shifting in the state, he said, "This is still Texas."

Former police captain accused of violent attempt to prove election conspiracy was hired by GOP activist's group

A former Houston police captain was arrested after allegedly running a man off the road and threatening him at gunpoint — what prosecutors say was part of an elaborate attempt to find evidence for a false conspiracy theory of widespread voter fraud in Harris County.

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