This might be a reasonable excuse if they didn't have the same problem in 2011 and weren't warned it could have been much worse.

But they did. And were warned. And they ignored it.

However many times it happened, that still doesn't tell us whether the costs exceeded the savings. "Twice" isn't much more often than "once"

Well, of course costs of resiliency would practically exceed savings for energy companies. But the costs of outages are tremendous for Texas overall. That's why critical infrastructure must be well regulated. Corrupt politicians are sure to protect profits of the energy industry, but in the end we all pay for the shenanigans that deregulation allows them to get away with.

Lets say it led to no increased profits and the savings were entirely passed on to the customer (perhaps through careful regulation like you mention). Then wouldn't the costs be better for Texas overall?

No, the cost to produce electricity is largely independent of the value people receive from it.

Differences in incentives are why hospitals for example have backup generators. They might be paying 100x as much to get power from a generator for a few hours a year, but losing power would cost them vastly more.

That said, individual consumers are going to have their own personal preferences. For some people saving 10c a month on their monthly electric bill might be worth a once in a decade power outage. Some might even agree to save 1c/month.

I think there is another factor of Choice that needs to be considered here. If people were given the choice between losing power when it gets cold and saving money or paying more for more reliable power then it might be reasonable.

Power companies making that choice for their customers isn't fair. As a utility it should be expected that it is well run and stable. It isn't an easy market to have competition in due to the infrastructure meaning we can't have "cheap and unstable" options next to "expensive and stable". Where the state decides the utilities fall on that axis is the question here, I personally think they should be on the more conservative side and provide stability.

The other thing to consider are the huge knock on effects from losing power. I may be ok with getting extra cash in exchange for power outages but when the stop lights are out and restaurant freezers start thawing things get a lot worse.

Good points. Although, it is of course impossible to have perfect service. Is a major failure once a decade not "well run and stable"? What level of service would be acceptable?

“but in the long term, were the losses worse than what they saved by not implementing extreme cold weather mitigations?”

A lot of people (and businesses too) have been without any power for several days. In the case of Austin, “a lot” appears to be around 40%. Many more have had power only intermittently. That’s got to be a pretty sizable hit to economic output. Not to mention all the busted pipes.

[edit: formatting]

But is it greater than the impact on economic output of having done a safer, but slower and more costly expansion of the electrical grid? That's much harder to measure

Heh, this is a 100 billion+ disaster when it is over. There are so many things people have not talked about yet. Multiple blood banks have lost their entire cooling and flooded at the same time. A medical testing and samples lab has had similar issues. You've not seen that in the news yet.

The there are the things we do know, like the Samsung IC shutdown that will cost millions in itself.

"By Friday, when Ercot declared that the emergency had ended, 14.4 million still lacked reliable access to public water supplies, and the crisis had already cost the state $50 billion in damages, according to Accuweather. The cost of power on Monday alone was $10 billion, according to estimates from Wood Mackenzie."

https://www.bloomberg.com/news/features/2021-02-20/texas-bla...

That is indeed compelling for the mismanagement argument.

It seems like you're thinking purely of net economic impact.

As someone in Texas who just got their power back and no longer has running water, I'm having a real hard time not posting a really vicious retort here.

Pure capitalism without any humanism is really quite gross and frustrating.

No, I am really thinking of net impact, economic and otherwise (but the parent mentioned economic output, so I was replying to that point)

Were the losses worse? Yes, workout a doubt? People died. Pets died. Homes and water mains were destroyed. People have to boil their water. Having power wouldn't have prevented all that but it definitely would have prevented some.

It's possible more people could have died from, for example, medical delays due to smaller hospitals from increased electricity costs over a period of decades due to unnecessary risk aversion

... What?

The cost of electricity is not a constraint on the size of hospitals. And there are plenty of states who are part of the national grid, with cheaper electricity than Texas.

It depends on how you price a human life. Give me that number, and I can start to answer.

More than 300 people have ended up in ERs in Houston alone for carbon monoxide inhalation as a result of misguided efforts to avoid freezing to death, I'm not entire sure how to allocate that cost, either.

1989, 2011, 2021. At some point, having been told twice now, and soon to be a third time, you spend the money to avoid the pitchforks.

>losses worse than what they saved

I'm sure "we saved a few bucks" will be comforting to the families of people who froze to death or died of carbon monoxide poisoning from this entirely avoidable disaster.