Janine Jackson interviewed Food & Water Watch’s Mitch Jones about the Texas freeze-outs for the February 26, 2021, episode of CounterSpin. This is a lightly edited transcript.
Texas Monthly (2/19/21)
Janine Jackson: The winter energy crisis in Texas has led to a number of strange scenes, from frozen fish tanks and basements turned into skating rinks to officials claiming that the crisis—in which more than 4 million people were left without electricity or heat, some without water, during a frigid week, and those whose lights stayed on faced eye-popping bills—was caused by the state’s reliance on renewable energy sources. Or, in the words of Gov. Greg Abbott, that it “just shows that fossil fuel is necessary.” Even a critical article on the “disaster foretold” takes the time to spell out:
For the record, no one who is well-informed about energy is suggesting that Texas, or, for that matter, the nation or the world, can or should operate without fossil fuels—in at least the next several decades.
So will that be the takeaway from this chain of events that, by the way, killed at least 80 people, including an 11-year-old boy found frozen in his bed? A round of fingerpointing among officials, followed by a return to the same set piece of debate about “regulation” versus “freedom,” a kind of ping-pong match on the edge of a cliff, while regular people wonder if we’ll survive the next “unprecedented,” “surprise” catastrophe, or the one after that?
Assuming we want to get off this dangerous dime, what type of conversation will move us forward, and what ideas need to be left behind? Mitch Jones is policy director at Food & Water Action and Food & Water Watch. He joins us now by phone from Baltimore. Welcome back to CounterSpin, Mitch Jones.
Mitch Jones: Thank you, Janine; it’s great to be back on.
Washington Post (2/23/21)
JJ: One could spend a lot of time, I guess, with the various factors, and blame, and history, and there are important stories there. But if we want to prevent such a thing from happening again, then it seems like we need to target the conversation.
Like, for example, board members of the Electric Reliability Council of Texas, or ERCOT, that monitors the electricity grid, and that ordered the outages: I hear that they’re resigning now, and I’m reading that folks are outraged because some of them didn’t even live in Texas—and I’m not really sure how germane that particular outlet of energy is. I wonder if you would talk us through: What are the things to be looking at as the main factors that led to this still-evolving crisis in Texas?
MJ: One of the biggest factors in all of this, the immediate crisis anyway, was the fact that the Texas regulators never required the power plants in Texas to winterize. And you would think, given that they had major power outages in 2011, in winter, and then came very close to doing so again in 2014, that by now, the Texas legislature would have taken steps to winterize power plants. But that wasn’t done.
Texas remains a widely deregulated electricity market. There’s very little oversight over the utilities in the state, relative to other states. They aren’t required to take these necessary steps to protect reliability, because it will harm profits, and the Texas system is designed to put profits before people.
And this is really, in the immediate crisis, the thing that failed most, was that you had a lot of fracked-gas electricity go offline, you had nuclear power go offline, you had coal plants go offline and, yes, you did also have some non-winterized wind turbines go offline. But the vast majority of the electrical load that dropped was from fossil fuels, and it was because of the lack of regulation and preparation in Texas, and putting profits before having a reliable grid system.
New York Times (2/21/21)
JJ: When media, like the New York Times, for example, are talking about that deregulation—which I think folks are kind of acknowledging at least set the stage for this storm, and the outages around it, to be as catastrophic as it was—the New York Times explains that “the people” wanted that energy deregulation that the energy industry also wanted. And the phenomenon that you just explained—the Times says, “With so many cost-conscious utilities competing for budget-shopping consumers, there was little financial incentive to invest in weather protection and maintenance.”
It sounds a little bit like, it’s not that the system was flawed, but it just kind of didn’t work, and at least partly because people are so cheap–people were trying to save money, you know. And the Times piece also says that the ‘prediction of low-cost power generally came true.’ In other words, deregulation may have failed in the pinch, but that up until now, it was working just fine.
MJ: That’s interesting, because the Wall Street Journal, that paragon of socialism, reported yesterday that deregulation in Texas has cost Texas ratepayers $28 billion since 2004. In other words, their research shows that had Texas not deregulated, the residents of Texas would have saved $28 billion over the past 17 years on their utility bills.
So if the Wall Street Journal can see, by looking at the evidence and looking at the data, that deregulation not only failed to deliver the lower prices that were promised—and this is seen throughout the country; it’s seen basically everywhere electric markets were deregulated—if the Wall Street Journal can see that, then I think we need to take really seriously the fact that deregulation failed on its central promise, which was to deliver lower electricity prices to consumers.
JJ: Let’s talk a bit about the opposite of that, these folks who are getting really life-altering electricity bills now, the folks who did not lose power. Texas Gov. Greg Abbott is saying, “We have a responsibility to protect Texans from spikes in their energy bills that are a result of the severe winter weather and power outages.”
Well, that’s sidestepping exactly what those spikes are the result of, but I also have a question. I don’t want people to be stuck with these crazy bills, but I just wonder: Will this failure mean nothing if we then go back to saying, “Look, it’s cool to do this off-the-grid thing, because mostly you get low rates, and then, when the system works as intended and you get gouged in times of trouble, well, the state will step in and soften it.” It sort of seems like they get to live by the sword but not die by it, and promote a system that doesn’t actually work the way that they say that it will.
Mitch Jones: “We at Food & Water Watch have called publicly, loudly, for a public takeover of electric utilities and power generation, so that it can actually be governed democratically for the good of the people.”
MJ: Right. We’ve got to be clear: The system worked as designed in Texas; that’s the really scary thing. From the failures because they didn’t winterize to the price-gouging prices. And the big headline grab is that costs shot up to $9,000 a megawatt-hour for electricity. The fact of the matter is, that’s the cap in Texas, and in the immediate wake of the power outages, there were people proposing lifting the cap to as high as $21,000 a megawatt hour. In other words, there were people saying, “What Texas doesn’t have enough of is even a wilder price swing in the middle of a crisis,” which is obviously fundamentally absurd.
You know, we don’t want people to be paying these bills; they shouldn’t have been price-gouged in the first place. There is a hazard that if the state steps in and takes over those bills, however, that we do get into a situation where the state of Texas is effectively bailing out the utilities, and feeding them the price-gouging prices every time a crisis happens. And then there’s no incentive–because, again, there’s no regulation to force the companies to do this in Texas–but there’s no incentive then for these companies to take measures to avoid these outcomes in the future.
And if anything, the way that the market is designed in Texas is designed specifically to prevent these utilities from taking precautionary measures ahead of time, because they make their profit from the price gouging. That is where their profit is going to come from. That’s why—and it’s not just on electricity, it’s on natural gas; there was the president of the natural gas company owned by Jerry Jones (who’s also the owner of the Dallas Cowboys), who said they “hit a jackpot” last week because of price spikes, due to an inability to deliver natural gas through frozen pipelines.
That’s how the Texas system is designed, and we can’t fall into a repeated pattern of the government bailing out the utilities in this way. Texas needs really massive reform to its electricity system. It needs to get a handle on those electric providers. And we at Food & Water Watch have called publicly, loudly, for a public takeover of electric utilities and power generation, so that it can actually be governed democratically for the good of the people.
JJ: Well, that sounds like right where I wanted to go for a final question, just maybe expanding on it.
MJ: I was reading your mind.
JJ: I saw this thing from the Federal Energy Regulatory Commission that they’re going to “open a new investigation to examine…”—and you just, ugh! A new investigation to examine the threat…. Is the scale of the response commensurate with the scale of activity that things need to be on now? And if it’s not, what really is called for?
MJ: The response isn’t of a commensurate scale to the crisis and the failure, which also extended to water systems and other systems.
Congress really needs to take a lead. I know they’ve been talking about holding hearings, but they need to do more than just hold hearings. They need to craft and pass meaningful legislation to begin to unwind the decades-long push driven by the Koch brothers, Enron and others, to deregulate our electric markets, our electric utility industries, and turn them into for-profit cash cows for investors. That’s where Congress needs to go. It needs to be a federal response, not a state-by-state response. And at the moment, we’re not really seeing concerted effort for that.
Some members of Congress, Congresswoman Cori Bush from Missouri, in particular, are calling for these sorts of measures. But right now, we’re not really seeing that concerted effort. But I hope that in the weeks to come, we will start to see those hearings form and see legislation be drafted in response.
JJ: We’ve been speaking with Mitch Jones from Food & Water Watch and Food & Water Action. They’re online at FoodAndWaterWatch.org. Thank you so much, Mitch Jones, for joining us this week on CounterSpin.
MJ: Thank you, Janine.
