How the Texas Power Grid Works and Why It Failed

Flip on a light, toast a bagel, crank up the heat: Most of us take for granted the electricity running things in our daily life and never think about the national power grid that delivers energy to our homes.

With the possible exception of Texans.

Power by Texans, for Texans

The U.S. power grid is divided into three sections: One serves the west, another the east, and the final portion is reserved for the state of Texas. Power generated by Texans, for Texans.

You may have heard about the state’s energy problems after a massive ice storm hit in February 2021. Temperatures plummeted, and as people flipped on heaters to stay warm, the surge in demand surpassed Texas's capacity to generate electricity, and parts of the state went dark for days.

Why Is Texas on Its Own?

At the turn of the 20th century, states saw power as a necessity and began regulating companies to ensure energy was provided equitably. Regulations were established covering which companies could sell electricity and how much they could charge. Texas, seeking to avoid federal and interstate rules, opted out. Instead, the state's power companies merged to create bigger companies and share power without exporting any over state lines.

Other states saw this as a good idea, but they couldn’t generate enough energy to reliably serve their residents. Texas was different because of its size: It covers two time zones, meaning some parts of the state require peak power an hour later than the rest of the state, and some parts throttle demand back an hour earlier than other parts. This permits Texas's power authority, the Electric Reliability Council of Texas (ERCOT), to produce sufficient energy for its customers. ERCOT produces power for 90% of the population, with other states' grids providing the rest.

Why Did the Grid Perform So Poorly in the Storm?

In Texas, just over half of the power comes from natural gas-powered steam generators. Another approximately 25% is generated by wind turbines.

Natural gas wells and wind turbines aren’t weatherized in Texas’s normally mild climate. So when the winter ice storm hit the state, these sources mostly failed. Texas’s power demand usually peaks during hot summers, with minimal need for heating during mostly mild winters. During the winter storm, residents stayed home, pushing demand beyond the already diminished capacity.

The state wasn’t prepared for the massive storm and falling temperatures. The ice and cold left 4.5 million Texans without electricity for days and property damage was estimated at $20 billion.

How Will Texas Solve Its Grid Problem?

Winterizing natural gas and wind power against extreme cold may be Texas’s best bet against future electricity blackouts. Diversifying their power sources may also help create a more reliable supply of energy. For instance, an area too dependent on solar power may have electricity problems at nighttime. One that depends too highly on gas can also be problematic as gas can have shortages and price volatility. Upgrades to the grid, particularly in large cities, may also help.

Texas Power Grid FAQs

The Bottom Line

Reliable electricity service for Texas may depend on closely monitoring population growth, since the influx of residents is taxing its grid. Winterizing its gas and wind infrastructure, making needed improvements to the grid, and adding power plants and transmission lines can also go a long way to preventing Texas blackouts in the future.