Episode 102 With Senator Bob Hall – ERCOT Reform

On February 13th, Winter Storm Uri slammed into Texas, impacting all 254 counties and leaving millions of Texans across the state without electricity or water. ERCOT, an agency that very few Texans had ever heard of, was now front and center to the newly-commenced 87th legislature. Senator Bob Hall has been leading the charge to get to the bottom of what happened and making sure that it never happens to Texans again.


Podcast Subscribers


Senator Bob Hall:
John, thank you very much for having me on. It’s an honor to be here with you this morning.

Jon Schober:
So what I want to do is let’s start with, what do we know? What in the world happened?

Senator Bob Hall:
Well, what we know for sure is a lot of Texas went without electricity in a very surprise event that was unexpected by those. And all of a sudden people realized how important electricity really is. It’s something we take for granted. We don’t put one thought behind the fact that when we flip the switch, the lights come on. When in reality, as I’ve said actually since I got here a few sessions back, electricity is the third most important thing to sustaining life. The only two things more important are air and water. And what we learned last month with this is we don’t get much water without electricity, making it actually the second most important thing. Something that used to not even exist in society, and certainly when I was growing up, it was a luxury item.

And so it is absolutely essential to our society continuing. And we came very, very close to an incredible disruption of electricity that could have lasted for months. I don’t think people realize that this was Hollywood movie material in what happened as ERCOT lost control of what they were supposed to be doing in providing electricity. And we came within minutes, if not seconds, of a catastrophic failure of our power grid.

Jon Schober:
So give a little bit of explanation. Who is ERCOT? Just give us the explanation of the key players because we’ve got ERCOT, we’ve got the regulatory agencies. Who are the key players that are involved in this?

Senator Bob Hall:
Well, there’s two. It’s the PUC, Public Utilities Commission, and ERCOT, the Energy Reliability Commission, which was created back in the ’90s, I believe, when we were looking at what do we do in Texas for power. And the federal government wanted us to join in with all the other states in one big regulated power grid for the nation. And Texas said, “Why do we need to do that? We are producing about as much power as the rest of them area wise. We can handle this ourselves.”

And so Texas is the only state in the nation that actually has its own power grid that covers about 85 to 90% of the state. The rest of the nation is the power companies on the east and to the west of us. And so the company ERCOT was created, a nonprofit corporation, to be the manager of the power system in what we called an unregulated market. We deregulated it and opened it up. Now it’s not a true deregulated. It’s a semi-regulated, but it does allow Texas to have power a lot cheaper than a whole lot of states do.

Jon Schober:
Yeah. So ERCOT is kind of the marketplace, and then where does the PUC, where do they fit into this?

Senator Bob Hall:
They’re the regulatory. They’re the oversight. They’re supposed to be making sure that ERCOT is doing what they’re supposed to be doing and the power companies within ERCOT that are under their regulations are operating within the bounds that was intended for this unregulated market that’s not really a free market because there’s not really true competition from a customer standpoint. The competition lies with the power generators.

Jon Schober:
And then as you’re going through some of the legislative things, what’s the legislature doing to address these issues? Go beyond just the bullet points. What are we trying to accomplish? What do we want to fix?

Senator Bob Hall:
Well, to talk about what we’re going to fix, let me first describe what happened to us and how we got there, because it didn’t happen overnight. There was a number of things happened. And the bottom line is everybody’s been looking to point a finger. Who is to blame? Why did this happen? Who is to blame? Let me just cut to the chase on that. The only place a finger can really be pointed is right straight at the legislature. The legislature failed to do its job in little bits and pieces along the way. A lot of people wanted to point to wind power and solar, that they caused the problem. No, they didn’t cause the problem. It was the policies that allowed them to be where they are, operating the way they are, that were behind them that set the stage for this to happen.

It was partly because it was the policies for clean air that has caused so many of our coal-powered plants to be shut down. It’s the policy behind wind and solar that limited our gas-fired plants, that they could not operate at maximum capacity. And it’s the policy behind wind and solar that caused us to spend close to $19 billion of taxpayer money for transmission lines to deliver the power back. And we continue to spend at a rate about $1.4 billion a year, shoring up solar and wind power for people thinking they’re getting something for nothing.

And so with that, then you bring on top of that an unusual event in which you have an incredibly rapid drop in temperature with a equal increase in demand. And when you bring those two together, you have things that break. And so we had the power generators that were not expecting the quick changes that were made. And so we started losing power plants because of the rapid demand, which as we lost them, it turned out that some of those power plants actually provided power to the gas suppliers. And so the gas suppliers were unable to supply gas to other power plants.

And all of a sudden we had a demand that was greatly exceeding our capability of supply. And understand that the power company, the way it works is the supply and demand have to stay balanced at all times. They’re very close. It’s a very delicate process. And that’s what ERCOT’s main job is, making sure that the supply meets the demand. It’s not the other way around. Because folks, there’s basically very little control until you go to rolling blackouts on controlling the demand side.

And so when the supply dropped below what the demand was, ERCOT was forced to require power companies to start rolling, turning power off. And that system was not ever tested very well. Part of the problem came that ERCOT, their algorithms for controlling it had never really been tested, and they had done just superficial testing of the system. Now having been in the military, I know that we would always do things to be worst case, always had worst-case scenario testing. ERCOT never bothered to do that.

So as we dropped as low as we did, they really had never been there before. They had never had to do that, and they never had the quick timing they had. So we came very close to it. So it’s a combination of all those things that I’ve described that we are trying to address. The PUC, they failed to have adequate oversight. 10 years ago, the legislature had the opportunity to require the power companies to winterize, just use that word to describe to protect against temperatures, and the power companies have an incredible influence on the legislature.

We have many legislators down here that listen more to the power companies than to their citizens or just a strict, what’s the right thing to do. And so the power companies convinced them, leave us alone. We’ll take care of it. We’ll do it. And they didn’t do it. And so the legislature failed us 10 years ago, and right now I don’t want to be where we’re looking back at this at the 2031 legislature that looks back to our 87th and say, “Why did you guys kick this can down the road one more time when you could have fixed it?”

Jon Schober:
Right. And I think the other risk is not just kicking the can down the road, but doing things in a knee-jerk reaction. So I know you’re an engineering by trade. I’m not an engineer, but I have a daughter that’s a engineer, and people talk about winterization and weatherization. Well, if we insulate these things for extreme cold, that’s going to affect capacity in the heat. So how do we balance some of these needs so that we don’t end up with a knee-jerk reaction that puts us in a worst place? Because now we can’t supply electricity in the heat, which is much more common than the extreme cold. What are we doing to mitigate against a knee-jerk reaction from the legislature or the regulatory commissions?

Senator Bob Hall:
Well, I think what we’ve done with the legislation so far with SB-3 is that we’ve laid the framework for meeting the objective of being able to supply power, to have a reliable and resilient system. And we’re going to look to the power companies to say, “Okay, what do we do?” One of the problems we have is that we used to have weatherization for our gas systems, but for some reason, the same policy that caused us to go to wind and solar, the environmental clean energy, required the gas companies to remove that winterization that they had that would have stopped the freezing at the wellheads.

Some of those things we need to get back to. We need to look at unreasonable policies that have been put in place for this unreasonable objective of this green energy, which is going to cost us dearly in moving forward. If we had listened to the green energy folks, we would have been all solar and wind, and just think of the mess we would have if that’s what the case is. Because solar and wind, while they can produce power, they are unreliable. At best, they’re available 50% of the time. The sun doesn’t shine at night, and the wind doesn’t blow all the time.

And so we’ve got to be careful that we put parameters out there, and I think we’re moving in that direction of what has to be done to make sure we have the capacity. And there are other alternatives of standby generators that are only there for emergency purposes for capacity, supporting it. The bottom line is, Jonathan, whatever we do, there is nothing free. It is going to cost. And whether we say, “Well, we don’t want to put state money into it. Let’s make the power companies pay for it.” Folks, there’s only one source of money in this state, and that’s the citizens’ pocketbook.

Jon Schober:
It’s you and me.

Senator Bob Hall:
That’s right. And we will pay for this. If we want a more reliable system, it’s just like today, we have much more reliable automobiles than we used to have, but they cost a whole lot more than what they used to cost also. And it’s going to be the same way.

Jon Schober:
Let’s talk about one of the other things that a lot of people are talking about, which is Texas just needs to throw away their independence and we need to plug into the federal grid. I’m going to be the devil’s advocate. Why shouldn’t we do that?

Senator Bob Hall:
Absolutely not. The nation is under federal government oversight, and that is the last thing we need here in Texas is more incompetent government oversight. Those power companies outside of Texas, they had some of the same problems we had. They’re just not Texas, so they don’t get the publicity we had. But we don’t need NERC and FERC, which is their regulatory organization is really basically connected at the hip to the power industry. They really do not oversee the power companies. They just do whatever the power companies tell them they’re allowed to do.

We have a bit of that problem here in Texas, that ERCOT and the PUC historically only do what the power companies here tell them to do. I think it’s time the legislature in this SB-3 to step in and fix that problem, and I think we’re doing it. We’ve got to be very careful in who we put in the PUC. We need to have people that understand the industry, but we don’t need to have political hacks being appointed to there because that’s not a political job. They have a technical job to do, and they should be separated from the politics of it.

And we need to go beyond just looking at that problem that we’re talking about of this winter, because we have other threats that are out there that are growing bigger every day. They were recognized by president Trump, and he issued executive orders when he was in office to start hardening our grid against natural and manmade threats that get bigger each day, as Iran grows in their nuclear capability as does South Korea, and the rogue nations are a big threat.

We know that Russia and China looked at using an EMP weapon. And even if they didn’t, we know that the sunspot problem is real. We’ve experienced it major at least three times that we have in recorded history. And it’s something that we absolutely need to include. If we’re going to have a truly reliable and resilient system for the people of Texas, which is what they deserve, we would be absolutely remiss in our job here this legislation, knowing how important electricity is, if we don’t take every step necessary to say we are working towards having a truly reliable, resilient and rich system.

Jon Schober:
I think what the underlying framework of what you’re saying is, it may be our mess, but it’s our mess, and Texans can take care of it and fix it. And imagine we’re having these conversations where people are talking about EMP and terrorist attacks. We all know what it’s like to go just a couple of days without electricity, and it’s not fun. We’re going to take a quick break, but when we come back, I’m going to ask you what keeps you up at night.

Announcer:
You’re listening to The Elephant Heard. We’ll be right back.

Pastor Vic:
Promises, God’s promises. He makes them, and he keeps them. Listen to Romans 8:28. This one is so good. It’s one of the basic principles of my life. “And we know,” and we have knowledge, “that all things work together for good to them that love the Lord, to them who are the called according to his purpose.” I’m called. I trust you are. And if you are, you love God because he’s such a good, gracious, generous, wonderful God. So with this knowledge that whatever’s happening in our life, good or bad, it actually all is going to turn out for good, believe it, and receive it. Romans 8:28. Remember God keeps his promises.

Announcer:
From the capitol of the Lone Star State, welcome back to The Elephant Heard.

Jon Schober:
Well, we’ve been talking with Senator Hall this morning about ERCOT and electricity and regulation and electromagnetic pulses. But the question that I have for you, Senator Hall is, even beyond your position as Senator and regulation, what is it that keeps you up at night?

Senator Bob Hall:
Well, that’s a really good question, Jonathan, and it’d be easy to say, yeah, right now, it’s making sure that we have a reliable grid system by getting the bills passed that we need to protect it. I could also say I fear where we’re going to go in the next election if we don’t get our election security fixed this time, because we know that fraud and error is rampant out there.

It could be the issue that most people are totally unaware of, of what we’re doing to young children with the gender modification surgeries that we’re subjecting young boys and girls to. We’ve got some real problems out there, but the thing that really bothers me the most is how our folks that are God-fearing Christians on the right are continuing to be so apathetic and complacent about allowing those on the left to absolutely destroy our country.

The woke things that are happening out there, the things that are creeping into our schools, where we’re now having critical race theory being taught to our kids in our classroom, that the kids are being taught that there are a infinite number of genders out there, that we’re allowing to happen, that our pastors are silent in the pulpits, that they are not speaking up. Had we not had our pastors back during the revolution that led the revolution with their sermons, it probably never would have happened. The Black Robe Regiment worked.

We don’t have that today. We don’t have the people on the right doing what they are on the left. The apathy is just rampant out there. And that’s what concerns me the most, that we are going to sit here like a frog in the cold pot of water. The heat’s up pretty high right now. Look around here. Look at what Biden did yesterday in decimating Second Amendment rights and what he has done in every other executive order out there. And we on the right are still just complacent about it. Oh, well, it’s okay. God’s going to take care of it.

No. God may take care of it, but we are his tools that he uses. He expects us to stand for him and to stand for what is right, and what is happening is not that. And it’s the apathy. We have got to have people more active. I’ll tell you down here at the capitol, we have been flooded with the left testifying at committee hearings, and it’s a dearth of folks on the right coming down to testify. So that’s what really concerns me.

Jon Schober:
[crosstalk 00:20:58] anymore. That’s what keeps me up at night as well, and I think there’s a lot that we can do to help energize that. But to your point, all that needs to happen for evil to succeed is for good men to do nothing, and that’s a major concern. Well, Senator Hall, thank you so much for being on the podcast. Thank you for what you’re doing, and Godspeed to you and the rest of the time at the legislature.

Senator Bob Hall:
Thank you, Jonathan. God bless you, and thank you for all you guys are doing out there under the leadership of Colonel West to get the party activated. Can’t thank you guys enough.

Jon Schober:
Wonderful. Thank you so much.

Announcer:
The Elephant Heard is provided by Texas Political Training and Empowerment and the Republican Party of Texas and is not authorized by any candidate or candidate’s committee. If you found this episode valuable, please subscribe to The Elephant Heard. Leave an honest rating. You can get all the links to your favorite podcast listening apps at texasgop.org/podcast.

The post Episode 102 With Senator Bob Hall – ERCOT Reform appeared first on Republican Party of Texas.

Leave a Reply