The Spark

“The emancipation of the working class will only be achieved by the working class itself.” — Karl Marx

Texas Power Outages and Disasters

Mar 1, 2021

No, it wasn’t the cold weather storm that caused almost the entire system of energy production and distribution to collapse in the state of Texas, plunging most of the state into darkness for several days. The electric and gas utility companies just never bothered to prepare their system for very cold weather. They did not insulate piping, or add little electrical heaters to wind turbines, or build inexpensive fiberglass huts to protect production equipment.

Why not? As Loretta Lynch, the former president of the California Public Utilities Commission, explained, “When the power plant generators in Texas have the choice between paying a shareholder dividend and paying to prepare for storms like they’re having now, the power plant owners paid their shareholders, customers be damned.”

After this disaster, even Republican politicians like Texas Governor Greg Abbott, who had opposed regulating the utilities in the past, swore that they would use the government to crack down. They are now promising that the Texas state government will enact new rules that will force the utilities to winterize their system to prepare for similar or worse weather.

But what are these promises really worth? As Lynch, the former California regulator admitted, in California there are certainly much stronger regulations governing the industry than in Texas. Yet, the results are surprisingly similar.

“What’s happened in Texas is what’s happened in California,” said Lynch.

In California, the three big utility companies that dominate the state have been repeatedly found liable for causing literally thousands of wildfires, most often because these companies don’t invest in new equipment, and don’t spend the money to do even the minimum amount of maintenance. Led by Pacific Gas and Electric (PG&E), with 16 million customers, they are getting away with murder.

Instead of rescuing all the people who had their lives destroyed by the California wildfires and gas explosions caused by these utility companies, the California politicians and regulators have run to the rescue of the utility companies. The politicians and regulators let these companies simply hike their electric and gas rates, promising that the money will be invested to improve service and upgrade equipment.

Instead, the companies pocket the money and increase their profits. Then, after one disaster after another, the politicians repeatedly fork over big taxpayer-funded bailouts.

And when all else fails, the courts have allowed these companies to use bankruptcy as a way of getting out from under the biggest costs of the disaster they have caused.

To the big public utilities in California, politicians, regulators and judges are simply pawns in their game. Thousands of e-mails between company executives and the California Public Utilities Commission released during various court actions have revealed the close connection between regulators and corporate executives. They show how the companies maneuver to pick and choose the judges who rule on their cases. They also show how these companies repeatedly lie on safety reports about work that they did not really do.

Big utility companies in both California and Texas act criminally and profit out of these criminal acts with impunity. And no politicians, regulators or courts will change this. Because under capitalism, it is corporate profits that come first, no matter what the cost to the people or the environment.