In Texas, CenterPoint Says Customers Must Pay Them Now AND Pay Them Later

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Let’s face it. What happened in Houston after Hurricane Beryl slammed into the Texas coast was a total, complete, and unmitigated disaster. 2.7 million people lost power — 80% of the customer base of CenterPoint, the utility company that serves the Houston area. A week later, power has yet to be restored to many CenterPoint customers. America hasn’t seen a total collapse of the electrical grid like this since Hurricane Maria devastated Puerto Rico in 2017. [Yes, it’s true. Puerto Rico is part of the US, a fact unknown to many Americans.]

No one should be surprised by the destruction caused by Beryl. The single overarching principle that underlies the entire Texas electrical grid known as ERCOT is to build everything as cheaply as possible to keep rates low. Some of us over the age of ten know when you go cheap, you often wind up spending more in the end than if you did the job right in the first place, but Texas, with its fierce determination to be utterly independent from the entire rest of the nation in every way possible, thinks ordinary life lessons don’t apply to it. And so it has a jerry-rigged energy grid that fails whenever it is put under stress.

CenterPoint Seeks To Shift Blame For Beryl

In a blog post today, HEATED says CenterPoint claims its infrastructure simply wasn’t built for this kind of extreme weather. Of course it wasn’t. In order to build a grid that can withstand more powerful storms, one must first acknowledge that such storms are a possibility and plan accordingly. Texans, thanks to being ruled by authoritarian know-nothings like Greg Abbott, are bombarded with official information that denies climate change is happening. And yet here it is, right at their front door in Houston, but rather than acknowledge the blindingly obvious truth, Abbott is attacking CenterPoint instead.

For its part, CenterPoint says it now needs an additional $2.3 billion to climate-proof its infrastructure. Of course it does. It built a 1920s energy grid that is totally inadequate for the needs of its customers a century later. What is surprising, HEATED says, is that CenterPoint is asking for this money to prepare for climate change while funneling millions of customer dollars into making climate change worse. CenterPoint is one of the worst utilities in the US when it comes to pushing against action to slow climate change, according to an analysis by InfluenceMap. And the utility doesn’t just advocate against climate action in Texas; it tries to delay climate policies all over the country.

CenterPoint Funds Climate Deniers

The InfluenceMap report finds CenterPoint has successfully fought policies to ban methane gas in Oklahoma, Louisiana, Texas, and Indiana. In Minnesota, CenterPoint also successfully lobbied politicians to oppose building electrification, and support methane-powered heat instead. To fight these policy battles, CenterPoint needs money, and the company gets most of it from customers, including those who suffered through a heat wave without electricity in Houston last week According to public records, CenterPoint has spent at least $3.3 million on “legislative advocacy” over the past two years — advocacy which includes support for anti-climate policies.

But these aren’t the only anti-climate actions CenterPoint spends customer money on. According to its public disclosures, CenterPoint has given more than $2 million to trade associations such as the Electric Edison Institute and the American Gas Association, both of whom are staunch supporters of thermal generation powered by fossil fuels, and opponents of renewable energy.

This year, EEI has spent more than $4 million on lobbying for bills, including a GOP measure to expand fossil fuel production. Last year, EEI spent more than $11.4 million on lobbying, most notably to oppose the EPA’s power plant pollution rules. The AGA, which represents more than 200 gas companies, is also a well-known purveyor of climate disinformation around methane gas. The group spent more than $1.3 million on lobbying last year, and nearly $400,000 this year, to advocate against regulations on gas appliances.

In addition to funding trade organizations, CenterPoint has also promoted climate delay by helping elect conservative, pro-fossil fuel politicians in Texas. Through its political action committees, the utility has spent more than $1.3 million since 2022 in total campaign donations. Most of that money went to Republican associations, including $500,000 to the Associated Republicans of Texas Campaign Fund, and $250,000 towards Project Red Texas. CenterPoint also funded the campaigns of state politicians pushing a slate of anti-renewables and anti-ESG bills.

Here are only some of the Republican lawmakers that CenterPoint used money from its customers to help elect, with donations in 2022 of at least $5,000:

• Senator Charles Schwertner, who authored legislation that allocates $7 billion to building new gas power plants. At a committee hearing, Schwertner said the fund would “balance out the ever-increasing penetration of interruptibles and renewables on the Texas grid.”
• Rep. Dade Phelan, the Texas House speaker who called President Biden’s pause on LNG exports “complete disregard” for America’s energy security.
• Rep. Phillip King, who called oil and gas “the lifeblood of the Texas economy” and said that ESG is “a movement to deny funds to businesses that will not sign on to extreme anti-fossil fuel policy.”
• Rep. Jay Dean, who led the “Natural Gas Protection Act” to prevent local bans or restrictions on methane gas or propane.
• Sen. Bryan Hughes, who attended the 2023 summit of the climate denial think tank Texas Public Policy Foundation. On a panel titled “ESG = Everyone’s Suffering Guaranteed,” Hughes called a coal plant in his district “clean” and said he would do “everything in [his] power” to stop subsidies for wind and solar power.

CenterPoint also contributed directly to the Texas Public Policy Foundation, a virulent right wing group known for its disinformation campaigns against renewable energy and powerful political influence.

CenterPoint claims that it “generally” doesn’t use its treasury funds, aka customer money, to support political candidates, which raises a question about what other sources of funds the company has other than payments by its customers? But the majority of its anti-climate activity is funded by customers, who have no choice but to pay their monopoly electric bills, according to HEATED. Those are the people who are suffering the most from the impacts of the climate crisis right now in Houston as they wait for power to be restored to their neighborhoods.

“So yes, CenterPoint needs funding to protect the grid from increased hurricane winds, high temperatures, and floods. But the way they’re currently spending their money ensures that, eventually, the climate crisis will catch up with them. And ordinary people will again be asked to pay,” HEATED says.

The Takeaway

On its website, CenterPoint says it has spent $1.5 billion to upgrade its grid infrastructure in the past several years and has filed a plan with regulators to invest an additional $2.3 billion to harden its distribution system. According to Axios, if there is not enough money available from state and federal grants to pay for the upgrades, the company’s customers will be required to pay for the upgrades in higher monthly bills.

Which raises this question. Texas has deliberately structured its grid to avoid interconnections with other regional grids in surrounding states, which allows it to thumb its nose at federal regulations governing the utility industry. If Texas wants to be so independent, why should federal taxpayers be asked to pull its chestnuts out of the fire? There is a strong smell of hypocrisy surrounding any request for federal assistance.

Texas wanted the cheapest possible grid and that’s what it got. It also has planted a big wet kiss on the fossil fuel industry while resisting any calls to address the impending threat of climate change. It got itself into this pickle when the effect of its choices was easily foreseeable, and yet the citizens of the Lone Star State continue to elect representatives who are rabid climate deniers and fossil fuel apologists. At some point, Texas will need to awaken from its long oil-soaked nap and start governing in a responsible manner. Don’t hold your breath waiting for that to happen.