Starting Feb. 10, unexpected cold weather anomalies lead to power outages all across the state of Texas. These ongoing statewide power outages can be attributed to the flawed power grid that has existed in Texas for years now, proving the dangerous inefficacy of deregulated power grids. All the shortsighted attempts at maximizing profits showed clearly how harmful privatization without adequate government regulation can be, especially in the face of the recent natural disaster.
The deregulation of electricity grids in Texas began with the idea that privatization would influence competition, forcing prices for energy way down. This 1999 movement was supported by both political parties and most Texans were attracted to the idea of cheaper, deregulated power. Texas carried out this attempt at deregulation by isolating its power grids from the national grid. This means that the utility companies in Texas are interconnected within themselves, but separated from the two other main interconnects of the nation, each spanning multiple states. Moreover, if something goes wrong in this isolated interconnect, it is likely to affect the entire grid.
The energy market is also competitive, meaning customers can shop between service providers. This may have reduced prices through the nature of competitive pricing, but it also means that companies will overlook basic maintenance for the sake of profits. Repairs are not made until something breaks, and basic standards in a regulatory environment are not met. The consequences of cutting these corners is obvious now, after recent snowstorms wiped out power across Texas.
Since then, limited access to electricity has caused prices to soar, with bills reaching up to $15,000 monthly for some unfortunate citizens, according to New York Times. Utility sites failed to equip themselves for harsh weather conditions, like Texas’s snowstorm, because some basic form of preparation for any scenario was not enforced or required. Texans are now stuck in their homes using candles for warmth. Additionally, because the Texas grid is isolated, it cannot reach out to other states within its interconnect for support through the sharing of resources.
The tragedy Texas faces is an example that basic human needs such as warmth and electricity should never be left for profit. It is the responsibility of the government to ensure that companies do not go unchecked on a factor of life that is so pivotal.
