Furthest Right

Why Texas Faces a Cold Winter: Green Subsidies

A number of friends have reported the following story: to get six-figure salaries, they specialized in niche computer technologies which in theory make easier what the bare metal guys have known how to do for decades at this point. These niches go on jobs listings, the price goes up, and so it is good be certified in them.

However, this year, the jobs postings are few and the conferences seem badly-attended. The recruiters are not calling as often, and the new projects are slowing down. What happened? The entire industry was funded by venture capitalist cash and a perceived growth market in advertising revenue, but both of those have crashed.

In this we see the problem with subsidies. They create demand like any other market, but that demand has a single source, and when that dries up, chaos results. The same is true of analytical thinking under Communism; people depend on the state, so lose the ability to do so on their own, and then when the state collapses, they are lost.

Texas might soon get an abject lesson in this problem. Thanks to green energy subsidies by the feds, there was less money in those old natural gas fired plants, so they were shuttered. Now that winter is coming and might be bad, it would be handy to have that extra energy, but — big surprise! — companies do not want to reopen the plants at a loss.

The state authority was willing to pay for extra power, but not what was required to restart the plants, so they got indifferent response from the industry:

ERCOT has canceled a program to boost power reserves for what could be a precarious winter for Texas’ electric grid after no energy companies volunteered to fire up their shuttered plants.

The Electric Reliability Council of Texas had sought enough additional electricity generation to power about 600,000 homes to shore up reserves after it forecast a near 20% chance of reaching emergency conditions this winter.

However, the power grid operator canceled the program on Friday after it received offers for only enough power for 2,200 homes, all of which came from companies willing to shed electricity usage during emergency conditions.

So these “shuttered” plants could be restarted easily, but anything has start-up costs. That is, you have to rehire staff, send them in to check and update all the gear, and start the plants running before the cold actually hits, which requires a cost of millions.

Texas instead wanted to pay them a few cents extra per kilowatt hour. This would not have begun to cover the cost of the plants even if a new ice age hit this winter, so the companies could not open the new plants. If they did, their shareholders would crucify them.

The media stands ready to heap blame on Texas for having its own energy grid, using natural gas, and whatever else they can think to advance the Leftist notion that only green energy is good, but the real source of the problem is (as usual) Leftist subsidies that distorted the market and made it unprofitable to run it well.

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