Sunday, April 11, 2021

What Houston Could Lose Because of Harris County's Anti-NHHIP (IH-45N) Lawsuit

This week we have a guest post from Oscar Slotboom making a very compelling case for a long list of benefits from the I45N redevelopment project as well as the risks of cancellation or delay - a list which seems to be getting lost in all the controversy.

Despite the support of the HGAC Transportation Policy Council, Harris County recently filed a lawsuit to block the IH-45 North Houston Highway Improvement project. Let's review the extensive and transformative benefits the NNHIP will provide for Houston, starting at the south end and proceeding northward.

The NHHIP will

  • Remove nearly a mile of elevated IH-69 freeway through Midtown and sink the freeway below ground level. This will be especially beneficial to the new innovation district hub and the Ion, which is adjacent to the freeway.
  • Provide relief for the chronic congestion on northbound IH-69 at Spur 527
  • Remove existing elevated ramps connecting into Chenevert Street
  • Add new long-span arched bridges at Elgin, Tuam and McGowen, providing an attractive architectural enhancement to the area
  • Retire the Pierce Elevated, providing the opportunity for redevelopment or creating one of the most distinctive urban parks in the country, Houston's version of NYC's High Line.
  • Provide relief for the chronic back-ups which occur for traffic connecting to the northbound Pierce Elevated
  • Remove a mile of elevated freeway through east downtown, sinking the freeway below ground level.
  • Provide the opportunity for new parks over the freeway, seamlessly connecting to Eado with the potential to transform the area similar to Dallas' Klyde Warren Park.

  • Provide all displaced residents of Clayton Homes the opportunity to relocate to public housing in the immediate area, or to receive vouchers
  • Relocate IH-10 so it no longer goes through the middle of UH-Downtown
  • Provide the opportunity to consolidate east-west railroads on the north side of downtown, removing the railroad from the UH-Downtown campus and improving development opportunities for the proposed North Canal project.
  • Reduce the footprint of freeways on the west side of downtown and at West Dallas, opening up more space for parkland and recreation. Plans include a new pedestrian crossing at Andrews Street.
  • Apply high-quality architectural standards to all the freeway structures, far better than the utilitarian and unattractive existing concrete structures from the 1950s, 60s and 70s.
  • Improve pedestrian and bicycle accommodations at all freeway crossings
  • At IH-45 and North Main, add a deck over the freeway, which substantially improves the situation as compared to the existing design.
  • Reduce the risk of flooding on the flood-prone section at North Main by applying modern flood control design standards.
Flooding on IH-45 near North Main
  • Provide four managed lanes on IH-45 north of downtown to Beltway 8, which will be an important part of a future interconnected managed lanes network for Houston to promote public transit, carpooling and technologies of the future. The managed lanes will provide the opportunity for two-way high-speed bus service to Bush Airport.
  • Modernize the antiquated interchange at I-45 and Loop 610, which has seen only minimal improvements since its opening in 1962. These improvements will provide relief for the chronic backups on eastbound Loop 610 approaching the interchange.
  • Provide the opportunity for new architectural enhancements and landscaping along the freeway from Loop 610 to Beltway 8, which is currently one of Houston's most unattractive freeways and unfortunately the first impression of Houston for many visitors arriving at Bush Airport.
  • Remove 58 billboards, with most along the North Freeway (reference FEIS page ES-19)
  • Between Loop 610 and Beltway 8, bring the frontage roads up to modern standards to facilitate safe and convenient access to businesses along the freeway.
  • Improve job access for the segment 1 workforce (from Loop 610 to Beltway 8).
    The City of Houston request, which is supported by Harris County, aims to make traffic congestion worse and force people into public transit that goes downtown. But when you think about it, this is entirely wrong for the corridor workforce. This workforce is generally not going to find a match for its job skills downtown. This workforce is far more likely to find a match for its skills at employment locations like Bush Airport, warehouses, industrial facilities, medical offices, factories and construction sites.The Hispanic workforce in particular is heavily represented in the trades, construction and landscape. This workforce goes to on-site work locations and is more heavily dependent on highways than other sectors of the workforce. Making traffic worse will impart disproportionately large cost and inconvenience to this workforce.
  • Provide congestion relief throughout the corridor. The NHHIP will improve freeway sections which currently are ranked among the most congested in Texas, with the following rankings: #3, 5, 6, 7, 10, 11, 13, 15, 17. Nine of the 17 worst congested freeways in Texas will be improved by this project, which is an amazing and remarkable amount of congestion relief for a single project.
As this list shows, this is not just a mobility project, but also a transformative urban improvement project for Houston. TxDOT is spending $7 billion including $5 billion in the downtown area to achieve these improvements for Houston. The FEIS plan was forged over 10 years, and like any complex plan it is a compromise plan, with elements for both sides to like and dislike. As with any compromise plan, you don't come back at the end and say "Oh, I want to keep the parts I like and get rid of the parts I don't like." That's not how a compromise works.

With the lawsuit, there are numerous scenarios in which the currently committed funding of $5.05 billion could be lost
  • Due to delays or insufficient local support, TxDOT could rescind the funding and reallocate it to other projects statewide.
  • The court could require a redo of the environmental process, which would take years and also wipe out existing plans. There's no assurance TxDOT will be willing to fund the Pierce removal and below-grade Eado freeway if the process restarts from scratch. When the West Loop expansion was canceled in 1992, the revised plan was a basic, low-cost plan. We know how that turned out, with the West Loop perennially among the top two most congested freeways in Texas, and usually #1 most congested.
  • Long delays could cause inflationary cost increases in the billions. Construction costs are down about 10% due to Covid, but as the recovery progresses we could see a severe inflationary surge similar to the increase seen after the Great Recession. In the five year period from 2011 to 2016, construction costs increased 60%, which would increase the project cost around $4 billion to $11 billion. (source)
  • Probably now or never. With TxDOT's generally declining financial situation due to reduced fuel tax receipts and declining oil severance tax (which funds Proposition 1), there is no assurance there will ever again be funding for a project of this scope if current funding is lost. TxDOT's funding is currently slated to be in steep decline in the 2030s, as Proposition 7 expires in 2029 and 2032.
  • The Biden "infrastructure" plan, if passed, would to be minimally helpful to TxDOT's long-term financial situation. Only $115 billion (5%) of the $2.3 trillion proposal is slated for highways and bridges. If Texas receives a share proportional to its population (which it probably won't), that would be $10 billion over 8 years, or $1.3 billion per year which is around 8% of TxDOT's $15 billion annual budget. Of course there would likely be numerous strings attached to the money, possibly restricting it to maintenance and repair.
If NHHIP is canceled or defunded because of Harris County's actions, it will be a huge loss for the future of Houston.

UPDATEWe're not the only ones that see the benefits of this project:

Houston Chronicle:  Supporters of I-45 widening say pause puts promises of relief on hold, too

'Others bristle at the concerns voiced by critics who say they are representing minority and low-income groups, when many Black and Latino groups, businesses and residents want the project. Local NAACP officials and others cheered TxDOT for going to unprecedented lengths to include communities, who are not in total agreement with those who argue the project is racist or unfair to struggling families.

“There are people that come on the line that say they speak for the poor, but they have not spoken to them,” community activist and urban planner Abdul Muhammad told the Texas Transportation Commission.'

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Monday, April 05, 2021

Are we entering the Distributed Age? Plus perspectives on Houston, TX #1 for infrastructure, and more

My leads this week are a couple of great quotes about Houston:

"Houston has actively deregulated, with the result that it's the only major city in the U.S. today undergoing a transformational change from suburban to urban densities. Houston makes thinkable the unthinkable." 

-Mercatus Center at George Mason University, Land Use without Zoning book letter 

"Once a planning pariah, Houston, with its peculiar lack of zoning, increasingly looks like the future." 

-Nolan Gray in the afterword of the newly updated Mercatus edition of "Land Use without Zoning" by Bernard Siegan.

If you're curious about the recently re-released book on Houston, "Land Use without Zoning" by Bernard Siegan, you can find it here.

Moving on to this week's smaller items:

"Other American cities—notably Houston, Dallas, Atlanta and Miami—are challenging NYC’s supremacy in communications, legal and financial services, the arts and business. Political and economic leaders in those cities encourage inclusive growth, development and change." 
"No state handles more of America’s cargo than Texas. In fact, no state comes close. According to the latest figures from the U.S. Census Bureau, the Lone Star State handles around $2 trillion worth of commodities per year. And Texas has the infrastructure to handle it. Port Houston, the nation’s second biggest, has surpassed Rotterdam as the world’s largest petrochemical complex, officials say."
“A year after the coronavirus sparked an extraordinary exodus of workers from office buildings, what had seemed like a short-term inconvenience is now clearly becoming a permanent and tectonic shift in how and where people work. Employers and employees have both embraced the advantages of remote work, including lower office costs and greater flexibility for employees, especially those with families.” … 
Still, about 90 percent of Manhattan office workers are working remotely, a rate that has remained unchanged for months, according to a recent survey of major employers by the Partnership for New York City, an influential business group, which estimated that less than half of office workers would return by September. … 
“We believe that we’re on top of the next change, which is the Distributed Age, where people can be more valuable in how they work, which doesn’t really matter where you spend your time,” said Alexander Westerdahl, the vice president of human resources at Spotify, the Stockholm-based streaming music giant that has 6,500 employees worldwide.
"As Houston prepares for unprecedented population growth in the coming decades, I predict that the versatile ADU concept will continue to help make our inner-city neighborhoods more affordable and sustainable."
"In 1976, New York Times architecture critic Ada Louise Huxtable declared that Houston was “the American present and future. It is an exciting and disturbing place,” one that “scholars flock to for the purpose of seeing what modern civilization has wrought.” In her account the city's distinctive character lay in its decenteredness, its seemingly limitless capacity for shape-shifting, and its utter lack of history. Like many observers then and since, Huxtable was struck by the experience of juxtaposition—of form, scale, type, and space—that was a consequence, in part, of the city's infamous lack of zoning regulations and its unapologetic accommodation of private real estate interests"

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Thursday, April 01, 2021

Baylor forfeits to UH after positive covid test - UH goes straight to national championship game!

In an absolutely unprecedented occurrence in NCAA March Madness tournament history, Baylor is being forced to forfeit its upcoming Final Four semi-final basketball game against the University of Houston after their star player Davion Mitchell tested positive for Covid-19, sending UH directly to the national championship game Monday, April 5th! UH is now redefining the classic March Madness "Cinderella story" after being the first team to make the Final Four without defeating a single-digit seeded opponent and now skipping right past the semi-final game straight to the National Championship game - just when you thought pandemic craziness couldn't get any crazier! 

Baylor is of course completely devastated by the news and trying to appeal, but the NCAA covid safety protocols are very strict and pretty clear. Even if every other player tests negative, there's no way to know if they haven't already been exposed and will develop it before the game Saturday.

UH Chairman and Rockets owner Tilman Fertitta issued a statement congratulating the Cougars on getting to the national championship while offering a generous consolation prize to the Baylor players after their sudden season-ending disappointment: once they clear covid protocols they're all welcome to immediately join the cellar-dwelling 13-34 Rockets as an "obvious and immediate upgrade," according to Fertitta.


Hope you enjoyed this year's April Fools post ;-D 
Here are previous years if you missed 'em and would like a chuckle:

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Saturday, March 27, 2021

Repurposing River Oaks Theater, grid resilience, Dallas insanity, reinventing inferior jets, Houston's diversity advantage, TX migration, NYC losing half its commuters, and more

Our first lead item this week is an in-depth follow-up from Jim Crump on targeted solutions to improve the electric grid in Texas. Highly recommended if you're interested in the nuances of improving grid reliability without extraordinary costs.  Speaking of which, it's been verified that we don't necessarily need to spend billions on winterization, we just need to treat gas pumps like critical infrastructure during blackouts! "This simple paperwork blunder left Texans cold during the deadly freeze

One more lead item so the blog lives up to its name this week ;-) Assuming the River Oaks Theater won't be taken over by a live theater group (really the best option), my suggested best realistic option in a streaming world: since Weingarten wants another high-rise there, preserve and repurpose it as a cool public lobby and coffee bar, marquee and all. Sure it's sad to lose the actual movie theater, but does that have any chance when you can stream pretty much any independent film at home any time?

Moving on to lots of backlogged items to catch up on this week:

  • Dallas insanity: $1.7 billion for 2.4 miles of mostly subway. That's $708 million per mile! Glad Houston METRO is being a lot more pragmatic and prudent with their resources than this. Hat tip to Oscar.
  • Several think tanks published their Metropolitan Blueprint for Texas.
  • Antiplanner on Reinventing the Jetliner (i.e. high speed rail) with some compelling opening paragraphs:

"Suppose I told you that I have reinvented the jet airliners that carried Americans more than 750 billion passenger miles–about 10 percent of all passenger travel–in 2019. My reinvented jet will go less than half as fast as existing jets. It will cost six times as much to operate, per passenger mile, as existing jets. Unlike existing jets, which can go anywhere there is air, the reinvented jet will only be able to go on a limited number of fixed routes. 
This wondrous invention will become a reality if the federal government spends a mere one, two, or possibly three or four trillion dollars. Does that sound like a good deal? No? Yet that is exactly what high-speed rail advocates are proposing. Some proposals, such as the Green New Deal, even call for almost completely replacing low-cost, fast jet airliners with high-cost, relatively slow trains."
Now on an opportunity cost basis, just imagine if those trillions went directly into carbon reduction instead of white elephant high-speed rail lines??
"Less than 50 percent of people who worked in Manhattan offices in 2019 will be working from those offices in the coming years, according to a recent survey by the Partnership for New York City."
"One thing I always admired about Houston is how confidently immigrants claim public space for themselves—how working families picnic in Hermann Park or elated quinceañeras roam the Galleria with their brightly attired entourages and pose for portraits before the Waterwall."
"Cities do not thrive by having more cutting-edge coffee shops, trendy restaurants and edgy boutiques; they need safe streets, decent schools and jobs for middle and working-class families." 
Finally, I'd like to end with a well-done in-depth video by CNBC on why so many businesses and billionaires are moving to Texas. Worth the watch. "Embrace the freedom!" 

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Sunday, March 21, 2021

The future of remote work and what it means for Houston

This week I want to focus on a single CSM story, because it's the most insightful I've seen on what post-pandemic work might look like: Remote work is here to stay – and it’s changing our lives. There are so many great nuggets, insights, and excerpts in it, which I'll follow with what I think it all means for Houston:

An IBM poll found that 54% wanted to keep working from home post-pandemic, and 75% wanted the option of working from home occasionally. 

“What the pandemic made blazingly obvious,” says a Manhattan entertainment lawyer, “is that there is no need for a physical office.” Only a complete lack of imagination, he says, kept the realization from dawning sooner. “Before the pandemic, we wouldn’t have taken the question [of going virtual] seriously. It wouldn’t have seemed possible.” ... 

It’s hard to find a management expert who doesn’t judge the work-from-home experiment a resounding – and somewhat unexpected – success. A survey by the recruiting firm Robert Walters found that 77% of professionals believe they’ve been equally or more effective when remote, and that 86% of employers plan to continue remote work “in some form” after the pandemic ends. A January survey by the consulting firm PwC revealed that employer satisfaction had risen even as the year dragged on, with 83% now assessing remote work successful for their company, up from 73% last June. 

Wrote one top manager in an email posted by economist Tyler Cowen: “Speaking from personal experience as a white-collar Exec, the productivity gains for our highest value workers has been immense. The typical time-sucks and distractions of in-office work have been eliminated.... Mental focus on productive efforts is near constant. Perhaps most importantly, work travel is not happening.” ... 

Among venture capitalists and venture-backed entrepreneurs, 74% now expect their companies to be majority or fully remote. ... 

“Even before the pandemic,” he says, “big cities like New York, Los Angeles, and Chicago were losing population to suburbs, lower-cost metro areas, and less expensive states in what Zillow called ‘a great reshuffling.’” 

The trend has accelerated, Mr. Kotkin says. “In just the past six months, New York City lost almost as many residents as it gained since 1950.” He notes that a recent report by Upwork, a freelancing platform, suggests that 14 million to 23 million Americans are seeking to move to a less expensive and less crowded place. Welcome to the “Zoom towns.” ... 

The market research firm Forrester predicts a 60-30-10 split among organizations: post-pandemic, 60% will be hybrid, 30% will be all-in-the-office, and 10% will be all-remote. ... 

Experts can point to only one other work style “experiment” like the one caused by COVID-19, though its sample size in comparison was minuscule. When a 2011 earthquake demolished Christchurch, New Zealand, the entire community turned immediately to telework. Then the city rebuilt, renewing its stock of office space. Yet years later a study revealed that Christchurch’s workers continued to operate remotely, away from their freshly available workplaces. “When [the crisis] was over,” said a researcher, “they didn’t go back.” 

If the expert consensus proves right, Americans won’t go back, either. 

“As remote working has boomed during COVID-19,” summarizes a study by the University of Utah, “the rise in the number of people working from home has prompted many to reconsider where they wish to live.” Which means, as the survey data already indicate, that as many as 40% of office workers could scatter outward from the name-brand cities to places more spacious and affordable. ... 

“As life at work [when remote] will be less social, people will have to get more of their socializing from elsewhere. So people will choose where they live more based on family, friends, leisure activities, and non-work social connections. Churches, clubs, and shared interest socializing will increase in importance. People will also pick where to live more based on climate, price, and views. Beach towns will boom, and the largest cities will lose.” 

So workers will be more dispersed, and more of their working hours will be spent where they live instead of elsewhere in an office. The question is: Could all this lead to a “reset” of the locus of community in America? 

Might the center of gravity shift at least somewhat from the office to the neighborhood – back, in a sense, to something closer to a pre-industrial model? What might it mean for our culture if the human contact that offices used to provide is replaced by closer-to-home human connections? And how might that affect the health of local communities and even levels of societal trust? ... 

Here Mr. Kotkin quotes Lenin: “There are decades when nothing happens; and there are weeks when decades happen.” 

So what does it mean for Houston?...

Working against us:

  • Not a classic lifestyle-destination city (think Austin, Denver, Miami) - no mountains or beaches
  • Big city problems, including traffic and crime
  • Climate: flooding, hurricanes, heat and humidity
Working in our favor:
  • Lots of Houston ex-pats that can come home to be closer to friends and family
  • Industries that are less amenable to remote work: manufacturing, refineries, port, health care, NASA, even energy to a significant extent
  • The most affordable global city in America - big-city amenities at an affordable price
  • Strong community culture for such a large, diverse city
  • High pull among immigrant networks
Overall I'd say we're likely to come out fairly well - not as good as the popular lifestyle cities, but much better than the unaffordable superstar cities like SF and NYC. Would love to hear your own thoughts in the comments...

UPDATE: Houston Innovationmap picked this up!

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Sunday, March 14, 2021

Texas Startup Manifesto 2.0, new top rankings, Houston housing elasticity, remote work reshaping America, and more

 Real backlog of smaller items this week...

"Houston—whose median home values are only 76% of the national average—stands out. Since 2010, it has had America’s 2nd-highest net population growth but is #1 in permits issued. This has made it an affordable city even in core locations; 1-bedroom, 1-bath downtown condo units can be found for under $200,000. 
How does Houston remain so elastic? Less regulation. The city famously lacks a zoning code, and many of its suburbs are also very pro-growth. This means it has fewer legal barriers to more housing than inelastic coastal metros, where proposed zoning changes can trigger lengthy and contentious review processes."

"Similar proposals show that the basic idea of hyperlocal zoning has precedent. Houston has been able to remain a city without zoning laws in part because residents had options in the form of deed restrictions, where neighbors could choose their own rules at the hyperlocal level. In 1998, policymakers were able to reduce the city’s minimum lot sizes by allowing residents on individual streets and blocks to opt out of that change, a move which helped overcome local resistance because residents felt they had control over the risks. The result? Some 25,000 more housing units, including denser townhomes, built close to job centers and transit, many of which Houstonians would not have seen built otherwise."
  • WSJ: How Remote Work Is Reshaping America’s Urban Geography (archive link) - Smaller cities and communities are turning into ‘Zoom towns’ and competing with coastal hubs as workers move to find more space and lower costs.  Basically, Richard Florida articulates Creative Class 2.0, which is the same as 1.0 but for remote workers outside superstar cities. Key excerpts:
Eye-opening stat: "remote workers are often more efficient than their in-office counterparts. They don’t waste hours on mind-numbing commutes, and they aren’t distracted by unnecessary meetings and water-cooler chitchat. The productivity boost to the U.S. economy from remote work could be as high as 2.5%, according to research by Stanford University economist Nick Bloom and colleagues." 
Conclusion: "The remote-work revolution promises to change the way that Americans work and live. It will allow smaller cities, suburbs and rural areas to compete with the superstar cities on the basis of price and amenities. It will shift the main thrust of economic development from paying incentives to big employers to investing and building up a community’s quality of life. As communities attract more remote workers, their tax bases will grow, allowing them to improve schools and public services, benefiting everyone. Eventually, companies will come too. That holds out the possibility of a better, more virtuous circle of economic development."
Finally, a couple items on Houston as a startup hub. First, we rank #4 on this list for annual startup formations and jobs created by startups (#10 for formation rate), behind DFW but - surprisingly - ahead of Austin! Second, the excellent Texas Startup Manifesto 2.0 is out (highly recommended), arguing for treating the Texas Triangle as one giant startup ecosystem (absolutely), with this excerpt on Houston: 
"Houston (East and Gulf Coast) is the fourth largest, and the seventh most diverse city in the US. It’s the energy capital of the world and is home to the Texas Medical Center (TMC), the world’s largest concentration of healthcare delivery and research institutions; to the NASA Johnson Space Center, a hub for cutting-edge human space flight research and astronaut training; to the number one seaport in the nation for waterborne tonnage, for foreign waterborne tonnage, and for vessel transits. Houston is an international city — a seaport, a spaceport, a “health-port”, and an “energy-port.” As a result, Houston has a diverse, high-tech industry ecosystem, and is increasingly an industry destination, serving as the home to 22 Fortune 500 company headquarters (with Hewlett-Packard Enterprise becoming the latest addition)."

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Sunday, March 07, 2021

Regulation of Electric Power in Texas

This week we have an excellent guest post by Jim Crump on the hot topic of the moment: fixing Texas' electric grid so the winter storm failures don't happen again.

Regulation of Electric Power in Texas

Politicians, pundits, and the public at large have voiced deep concern that electricity was tragically unavailable to many Texans during the recent period of extreme cold.  Claims that lax ERCOT planning caused the problem are exaggerated.  “Grid independence” from federal regulation is manageable.  The problem lies in the supervisory structure that regulates the Electricity Reliability Council of Texas (ERCOT) - Texas’ Public Utility Commission (PUC), a three-member panel appointed by the state legislature, and our elected officials, ultimate guardians of the public interest.  

To start, claims that ERCOT’s planning process is undisciplined are misleading.  Published documents (December 2020, January 2021) evidence well-structured scenario planning of capacity, demand, and reserve margin, including grid requirements and fuel types.  True, evolving events brought conditions not premised in these studies but laxness is an unwarranted criticism.  

The next layer of electric power management:  Oversight of ERCOT by the PUC.  Here, critical commentary by knowledgeable observers is valid.  To begin with, independent management of Texas’ power grid – that is, independent of the Federal Energy Regulatory Commission (FERC) – rests on reasonable logic, not merely the fabled secessionist tendencies of Texans.  

Two conditions in combination make Texas electrically unique.  First, the ERCOT grid embraces abundant energy resources as well as large urban demand centers, thus the energy system within ERCOT’s reach can self-supply.  (“Supply” goes beyond fossil sources.  The barren mesa region of west Texas is reliably windy.)  Next, the grid’s regional limits follow state lines to a high degree;  the political boundaries of Texas align with grid infrastructure, El Paso and portions of the panhandle and east Texas excepted.  The first condition (grid independence) allows supply without power purchase from other states, hence authority to operate free from regulation by the Federal Energy Regulatory Commission (FERC); the second facilitates rule-making and goal-setting, from the state legislature to PUC to ERCOT.  

Results of FERC-independent behavior are subject to debate; certainly positive outcomes can be offered.  ERCOT’s market-based model coupled with strong transmission infrastructure linking generation to consumers have enabled rapid growth of competitively-priced electricity sourcing, most recently wind generation and prospectively, solar.  ERCOT’s fuel mix report states that wind plus solar accounted for more than 20% of generated electricity in 2020.  

However, specific policies of a perhaps lenient regulatory framework appear unwise and call for revision.  A large proportion of winter electricity supply anticipated by ERCOT was disabled by frigid weather because established standards for deep-cold winterization had not been implemented.  In televised appearances Bill Magness (ERCOT CEO) and Dan Woodfin (Director, System Operations) explained that such standards are provided to generators on an advisory basis, not mandated.  

Also, ERCOT manages generation adequacy by pricing methodology, which failed in this severe case.  Reserve capacity, like winterization, may require measures beyond market-based methods (a mandate).   Of course, bulking up reserve capacity alone would be inadequate in the absence of stricter winterization.  Backup generators incapable of startup would have been of no help to Texans in the cold light of dawn on February 15.  

Clearer, more aggressive communication to the public might have saved untold damage and pain.  Meaningful public advisories that could have helped Texans to safeguard property (and life) were late and limited.  Future communication protocols must require updates on rotating or extended blackouts, health and safety information, and practical advice to prevent freezing of water systems.  

So, a call to our governor, legislators and PUTC commissioners:  Draw yourselves up to full stature, recognize that Texans’ lives are at stake, and formulate firm guidelines (yes, non-market guidelines where necessary) on winterization, reserve capacity, communication, and other requirements that will flow from the public hearings that Dan Phelan, speaker of the Texas House, has so sternly announced.  You must put right the executive functions linking our legislature to the PUC and to ERCOT. 

Texans suffered due to physical climate conditions, here a word on the political climate.  Both major parties must acknowledge shared responsibility for past power decisions.  Democrats:  Recognize that efforts to decouple Texas from FERC originated when democrats controlling Texas politics acted to shield Texas companies from federal regulators.  

Republicans:  Abandon the failed narrative that renewables caused the shortage – this is nonsense.  Abandon also the impulse to label renewables as menacingly “liberal”, therefore unworthy of service to the lone star state.  For one thing, such pronouncements violate the market basis for electricity sourcing that you claim to champion.  Recall also that Senator Chuck Grassley of Iowa, a Republican, is justly regarded by many as the father of wind energy – at least, father of legislative enactment of the wind operating tax credit, a spur to the growth of wind generation.   

Our leaders must tame their rhetoric, mandate best operating practices, and modify market-defined guidelines where required to protect Texans.  

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Sunday, February 28, 2021

A simple free solution to TX winter storm blackouts, Houston's reinvention + Texas' future, housing affordability survey, HEB, and more

Our lead item this week is confirmation that a simple bureaucratic fix could have prevented the massive Texas winter storm blackouts and easily prevent them in the future: simply add natural gas pipeline electric pumps to the list of critical infrastructure like hospitals so they don't get their power cut. If the gas had kept pumping through those pipelines, the gas-fired electric generation plants would have stayed online:

"Grant Ruckel, vice president of government affairs at pipeline company Energy Transfer, testified that the biggest failure during the disaster was cutting power to gas pipelines, many of which are not listed as essential services, a designation made for hospitals and other critical infrastructure." ... 

"Deshotel said he had asked generators how many plants would have gone down if they hadn’t lost gas pressure, and the answer was only a couple."

UPDATE: Verified! - This simple paperwork blunder left Texans cold during the deadly freeze, Houston Chronicle.

Moving on to this week's items:
'We surveyed our employees, and the No. 1 concern that people had was quality of life—but also taking mass transit to New York City any time in the foreseeable future.” There's another benefit for the well-paid workers too. They will “see a lateral pay move, which amounts to around an 11% increase in salary because Florida has zero income tax.”'
  • NYT: The Future of Texas. I like this opening excerpt, but the rest of the story is a bit silly, pretending that if Texas didn't produce fossil fuels climate change would be magically solved instead of just importing more oil from the Middle East. (archive link - h/t George)
"You can make a case that the U.S. state with the brightest long-term economic future is Texas. It’s a more affordable place to live than much of the Northeast or West Coast and still has powerful ways to draw new residents, including a thriving cultural scene, a diverse population and top research universities. Its elementary schools and middle schools perform well above average in reading and math (and notably ahead of California’s), according to the Urban Institute. 
These strengths have helped the population of Texas to surge by more than 15 percent, or about four million people, over the past decade. In the past few months, two high-profile technology companies — Oracle and Hewlett-Packard Enterprise — have announced they are moving their headquarters to the state, and Tesla may soon follow. As California was in the 20th century, Texas today looks like a state that can embody and shape the country’s future."
"Look at the cities. I’m not sure we see the implications of what has happened there. In New York we are witnessing, for the first time in a century and a half, the collapse of the commuter model. ... 
A lot of cities, not only New York, are going to have to reinvent themselves, digging down and finding newer purposes, their deepest value. They’re going to have to take stock in a new way: New York has the greatest hospitals, universities, the media, parks. What else? 
And they will be doing this within a hard context. Public spending is skyrocketing due to greater need; the city and state budget deficits are through the roof. New York is Democratic and public sentiment will be for tax increases, big ones. ... 
The Partnership for New York City reports 300,000 residents of high-income neighborhoods have filed change-of-address forms with the U.S. Postal Service. You know where they are going: to lower-tax and no-income-tax states, those that have a friendlier attitude toward money-making and that presumably aren’t going hard-left."
Does Houston need to reinvent itself as well? Clearly, we have big needs to invest in resilience infrastructure (Build the Ike Dike! h/t Evan ;) and our innovation economy as well as take steps for the energy transition (more than that, we need to actively shape it with better carbon capture technologies). But as a city, our core value proposition is strong: a global culture of Houspitalityopportunity, and resilience welcoming to immigrants (who spread the word thru their networks) while also providing one of the highest standards of living in the world. While the rise of remote work may cause issues for commercial office space (especially downtown, which may have too many new and renovated buildings coming online), the nature of Houston's core industries - energy, medical, industrial, space, the port - do seem to demand enough of a physical presence to keep workers close and the region strong (as opposed to finance in NYC and tech in SF).  And here's to hoping remote work permanently reduces some of our worst traffic at rush hours!  Overall, I feel fairly good about Houston's position in a post-pandemic world. Would love to hear your thoughts in the comments...

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