ERCOT CEO Grilled By State Lawmakers, As Power Plant Operators Admit Entire Energy Sector Failed Texas
AUSTIN, Texas (CBSDFW.COM) - The CEOs of companies making up the Texas energy sector found themselves on the hot seat at the Texas Capitol on Thursday, Feb. 25.
The State House and State Senate began separate hearings at 9:00 a.m. that ran well into the evening.
After hearing testimony for nearly two hours, State Representative Todd Hunter, R-Corpus Christi posed a direct question to two CEOs: "Here's the question I think most people are wanting to ask you. Who's at fault? I don't want to hear systems. I want to hear who's at fault? I want the public to know who screwed up?"
Curt Morgan, CEO of the Vistra Corporation in Irving, the former TXU said, "There's plenty of blame to go around. I think the thing was a colossal failure."
Sitting right next to him, Mauricio Gutierrez, CEO of NRG Energy in Houston had previously told members of the House Energy and State Affairs Committees, "The entire energy sector failed the State of Texas."
The comments come a week after the widespread power outages left millions of Texans without electricity, heat, and running water.
On the other end of the Capitol, members of the State Senate's Business and Commerce Committee grilled Bill Magness, the CEO of the state's power grid operator, ERCOT for more than five hours.
Magness repeated what he told the ERCOT Board meeting Wednesday.
He said as the brutal winter storm slammed the state, power plants kept going offline in rapid succession early Monday morning, Feb. 15.
Magness said ERCOT's control room operators were watching as the frequency levels on the electric grid dropped below an important threshold and remained for more than four minutes.
Had they stayed that low for another five minutes, Magness said that could have triggered a catastrophic blackout that would have caused substations and wires to catch fire leaving most of the state in the dark for weeks.
To prevent that, Magness said ERCOT ordered retail electric companies or transmission owners to cut-off power to their customers in large amounts all at once.
Magness said, "I believe the operators on our team did everything they could have in a dramatic, difficult situation."
Asked by the Dean of the Senate, John Whitmire, D-Houston if he would have changed anything during that critical time, Magness said, "As I sit here now, I don't believe I would."
In Corpus Christi Thursday afternoon, Governor Abbott rejected that and blamed ERCOT again for the situation that devastated millions of people.
The Governor said they blew an opportunity to slowly begin rolling outages. "Instead, what they did they delayed the decision-making process about rolling outages until they got right to a few minutes before the entire grid crashing. They did the equivalent of slamming on the brakes while driving on ice."
Power companies said ERCOT's actions forced their power plants offline.
Thad Hill, CEO of Calpine Corporation of Houston said, two of their power plants were tripped offline. "What we have found led us to believe they were a grid disturbance."
Morgan said he believes ERCOT's actions caused problems for one of the two nuclear power plants in the state. "We came within three minutes of losing Comanche Peak."
Back in the Senate hearing, Magness was asked about the CEOs' testimony.
Magness said, "They've not shared that with me. If they're right, we have to absolutely, we have to do something because there was something goin on we weren't seeing."
Morgan said ERCOT's actions exposed another problem:
Because the transmission owners had to cut-off power for more customers at once than they ever had to before, some power plant operators and gas companies lost power themselves.
Morgan said the problem was after a 2011 storm wreaked havoc to a less extent, the industry and state agencies never updated their critical infrastructure lists. "You're turning off my power plant, calling up the TDU's and saying why are you turning off our power plant. You weren't on our critical infrastructure or you're at the bottom of our list."
He and other CEOs said natural gas companies experienced problems beginning at the wellheads which froze, and transporting the gas to power plants.
Earlier in the week, the President of the Texas Oil and Gas Association, Todd Staples, told CBS 11 that many producers in the field lost production because of power outages and hazardous travel conditions made it impossible to move equipment and crews.
Morgan said, "The big story here in my opinion was the failure of the gas system to perform.
He said between 60% and 70% of the power in Texas is natural gas generation.
"We do not have an integrated and seamless gas and power system, and if we don't have a seamless gas and electrical power system, what happened last week, will happen again."
Staples said members of their trade group were conducting a top-to-bottom review of what happened.
Despite the challenges, Staples said natural gas provided about 66% of the power mix last week, which he said was higher than the 45% provided during a normal year.
"We think that natural gas did step up, did carry the load in a very big way."
The CEOs said they winterized their plants.
Morgan of Vistra Corporation said they spent an extra $10 million on weatherizing their facilities once they realized how severe the winter storm would be.
Gutierrez of NRG Energy said they prepared their plants as well, but that in some cases, the unprecedented weather experienced statewide, proved too much. "We had icing on four inches of dry air that should never have icing."
Governor Abbott has said he wants state lawmakers to mandate winterizing the power system.
After the 2011 storm, changes were recommended but not required in Texas.
While the Governor has blamed ERCOT, State Representative Rafael Anchia, D-Dallas, criticized him for not blaming the Public Utility Commission which regulates ERCOT and answers to Mr. Abbott.
"There's been a very carefully curated discussion of blame by the Governor, always speaks to ERCOT and never mentions the Public Utility Commission."
Morgan said after his company's meteorologists warned him about what would become a historic storm Feb. 9, he called ERCOT and other agencies.
"I was surprised by the lack of urgency that I got from some of the officials or agencies."
The Governor said ERCOT downplayed the storm and weren't fully prepared for it.
