ERCOT fired its CEO and the head of Texas’ utility regulator resigned following the state’s devastating storm blackouts

texas weather
Roads were covered with snow and sleet on February 15, 2021, in Spring, Texas.

  • ERCOT fired CEO Bill Magness Wednesday, after a storm left millions of Texans without access to power.
  • DeAnn Walker, head of the Texas Public Utility Commission (PUC), had resigned on Monday.
  • Lt. Gov. Dan Patrick had called for both of their resignations in the aftermath of February’s blackouts.
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Texas’ power grid operator fired its CEO on Wednesday following devastating blackouts in February that left millions of people across the state without access to power and clean drinking water for days.

Bill Magness’ dismissal from the Electric Reliability Council of Texas (ERCOT) came just two days after the head of Texas’ utilities regulator resigned.

State lawmakers, including Texas Lt. Gov. Dan Patrick, had called for both leaders to resign after last week’s Texas Senate hearing into the storm and its effects.

Magness was fired by the company’s board after an emergency meeting Wednesday night, CNN reported. 

ERCOT, a non-profit that operates 90% of the state’s electric load, came under fire after lawmakers said it had failed to prepare for the heavy storm that cut off large chunks of the state’s power supply.

Five of ERCOT’s board members had already resigned following the disaster.

Magness has a 60-day termination notice, during which he’ll continue to serve as the company’s president and CEO, ERCOT told CNN. The company expected to start searching for Magness’ replacement immediately, it told the publication.

Meanwhile, DeAnn Walker, the head of the Texas Public Utility Commission (PUC), resigned on Monday, which the PUC said was “effective immediately.” The commission regulates the state’s electric, telecommunication, and water and sewer utilities, including ERCOT.

“I stand proud that I worked endless hours over the past two and a half weeks to return electric power to the grid,” Walker wrote in her resignation letter, per The Wall Street Journal. She did not explicitly say why she was resigning.

“Despite the treatment I received from some legislators, I am proud that I spoke the truth.”

A major winter storm that hit Texas on February 15 caused sources of electricity, like natural-gas plants, to go offline, while simultaneously increasing the demand for energy as people across the state turned on heaters to stay warm.

This caused a huge shortfall in energy, and the wholesale price of electricity surged 10,000%. One Army veteran said he was billed $16,000 for power.

Millions in the state also lost access to clean drinking water and were asked to boil their water, after power outages hit treatment facilities.

President Joe Biden declared it a “major disaster.”

The huge spike in bills happened because of Texas’ deregulated energy market. Customers who signed up to buy their power based on its wholesale cost, rather than as part of a fixed-price contract, are vulnerable to price fluctuations, such as those that occurred during the storm.

Just hours before Walker’s resignation, Lt. Gov. Patrick released a statement calling on both Walker and Magness to resign.

“Both the PUC Chair and ERCOT CEO said they were prepared the day before the storm hit in full force, but obviously they were not,” Patrick said.

Patrick said they hadn’t considered that the freeze could shut down power plants, or that crews would not be able to make emergency repairs, and said their calculations on how much energy would be unavailable during the storm were inaccurate.

“These two issues alone accounted for hundreds of thousands of homes being without power and threatened a statewide blackout,” he said.

“They hoped for the best instead of planning for the worst,” he added.

Texan Sen. Ted Cruz has also come under fire after he went to Mexico during the storm.

US officials, including Houston mayor Sylvester Turner, have called on the state of Texas to pay residents’ hefty utility bills. Officials from Harris County, which includes Houston, are looking into leaving Texas’ deregulated power grid.

Read the original article on Business Insider