In letter to governor, Bexar County Judge Nelson Wolff blames winter disaster on energy deregulation

Wolff says current system ‘puts profits first’ and ‘reliability second’

Nelson Wolff penned letter to Texas Gov. Greg Abbott over ERCOT.
Nelson Wolff penned letter to Texas Gov. Greg Abbott over ERCOT.

SAN ANTONIO – In the aftermath of Texas’ winter storm disaster, Bexar County Judge Nelson Wolff wrote a letter to Texas Gov. Greg Abbott Friday, asking him to radically change how the state’s power grid operates.

Throughout the storm, millions of Texans found themselves without power for days. The lack of power led to water outages, busted pipes and deaths due to hypothermia.

The Electric Reliability Council of Texas, the nonprofit group that operates the state’s power grid, said the controlled outages were the result of demand for power greatly exceeding supply as power generators were knocked offline by the storm. The outages, officials said, were necessary as the state was “minutes” away from an even more devastating blackout.

In his letter to Abbott, Wolff said the current power grid setup has a “long-term problem of reliability.”

In 1999, state lawmakers broke up the power sector into three groups — those who produce power, transmission owners (like CPS Energy) and retail companies who sell electricity to consumers. Before that, the state’s power system was integrated, with all three roles carried out by appointed or elected commissioners.

“Across the state, deregulation led to ‘just in time power’ purchases from wholesalers without the incentive for storing back-up generation power,” Wolff wrote. “Energy producers are selling energy out of the state at a time when we needed power.”

If CPS Energy did not have to adhere to ERCOT’s mandated outages, they would have had enough energy to to power all of San Antonio, Wolff wrote.

“We find ourselves in a situation that puts profits first for utilities and reliability second,” Wolff continued. “It is time to go back to the proven formula of utility regulation that Texas had to prior to 1999.”

Due to the unprecedented demand for power throughout the week, CPS Energy CEO Paula Gold-Williams said that she “stopped counting” after the price of natural gas shot up by 16,000%. Those costs will have to be split up over the next decade or longer for consumers, Gold-Williams said.

Abbott was asked about the current system during a news conference on Friday, where he said lawmakers will be the ones to decide what to do with ERCOT. Abbott has ordered ERCOT reform as an emergency item that must be taken up by the Texas Legislature.

Read the full letter below:


About the Author:

Fares Sabawi has been a journalist in San Antonio for four years. He has covered several topics, but specializes in crime, courts, open records and data visualization.