Another test of resilience

It was surreal. In a dark house with a few candles for light, a battery operated radio offering ominous weather news, and a lone mobile phone managing occasional internet connectivity, my family was debating the pros and cons of braving out another night versus packing and driving on uncleared snow filled roads to a relative's house who still had electricity and hot water. The temperature outside was falling sharply and wind chill was predicted to touch -27F by early morning. Even discounting the complexities caused by COVID while being in closed confines, we had no idea if the entire hassle would be worth it given there was no guarantee how long they would have electricity either. 

The above scene is not from a remote part of the country but from a North Texas town consistently voted as one of the best places to live in the country. The entire Dallas metroplex has been reeling from power shortage in the middle of unprecedented cold for the last seven days.

Having spent a significant time in New Hampshire, we have seen much worse weather conditions brought by Nor'easters and yet never had to deal with the kind of dilemma we were facing here. For a town and state claiming to be a hot destination for businesses all over the world, how could an otherwise normal snow storm bring the state to its heels? With over 20 companies looking to relocate their headquarters here in the past year alone, the local economy here is booming. Land is aplenty, real estate is still affordable, air connectivity is excellent and low unemployment has ensured a genuinely cosmopolitan growth in population. 

How then could we have such a catastrophic failure?

While a thorough analysis is awaited, initial reports from WSJ and NYT point towards a failure of public policy. Electricity providers are under no obligation to offer power to consumers. They face no penalty if emergency situations prevent them from offering electricity. Millions of people in the state were without electricity because power plants from nearly every energy source failed right when they were needed the most. Nearly all of them had not undergone necessary upgrades to handle disruptions caused by subzero temperatures. The consequence for owners of the power plants was just the lost revenue and nothing else. 

Texas has long been touted as a pathbreaker in the wholesale power market. Back in the 90s, legislative effort broke utility monopolies and introduced a competitive marketplace for power generators and retail electricity providers. As a result, the market opened up, providers competed for lowest cost options to buy and distribute electricity, and this eventually led to lower utility bills for consumers, at least on paper.

This laissez faire market design rewarded providers for selling power cheaply and recovering their costs. It had no incentives for them to be prepared for extreme scenarios. Texas lawmakers take pride in the fact that the state energy market operates in an island free of federal regulations. During steady demands, this model works great but the limitations get exposed in the face of extreme fluctuations. With temperatures falling, consumers cranked up their heat and the resulting spike in demand put pressure on a grid already hobbled by parts not ready for sub-zero temperatures. Power plants began shutting down to prevent equipment damage and to be prepared for regular demand, this caused a cascading effect state wide and the resulting shortage led to the catastrophic result.

Society has paid a huge price

Nearly 80% of our neighborhood had water damage issues with broken pipes and water heaters failing. Homes with little children and pets had to deal with flooded kitchen and lack of hot water even after temperatures rose and power situation stabilized. 

Even more concerning are the heart wrenching stories pouring in from every corner of the state. A NYT report yesterday counted nearly 58 victims from reasons ranging from car accidents, carbon monoxide poisoning, fires, hypothermia, drownings, and many others. 

We got lucky that power came back after 50 hours but according to the last count over 150,000 people are still waiting for it. And when the temperature was at its lowest, nearly four million Texans were without power. 

This is just the visible impact. The overall cost in terms of lost productivity and financial hardship will certainly be many times more.

Technology and innovation have and will play a critical role

When the world was less reliant on power and technology, such natural calamities did not make people as handicapped as they today. For instance, over the years more and more homes are equipped with power switch ignition based single touch natural gas fireplaces. This means no need for keeping wood and dealing with the associated inconveniences. However, in our case, it prevented us from getting the heat going even when we had natural gas. This is a prime example of how reliance on technological innovations has made us all less empowered. 

Fortunately, there is a brighter story here. As it turns out, the Dallas metroplex has the second highest concentration of cloud data centers in the country. None of these centers failed during this extreme weather. The planning and considerations that go into running them is significantly advanced. Workloads are run in multiple cloud computing zones to dynamically switch and remain highly available even if one site fails. Preventing such failures is a necessity given the level of virtualization and sharing of compute/storage resources that exists in those centers. Likewise, in response to last year's pandemic, many companies in the local area have accelerated their investments in cloud. This meant that while the local offices and personnel had challenges, there was no real threat on the business applications. The resilience and stability of those environments was way more reliable.

A broader example of this could be seen in the city of El Paso. The city is part of the national grid and there was significant winterization investment made in the grid infrastructure after the last big winter storm back in 2011. While rest of Texas continued on with the old ways, this city focused on upgrading their equipment to handle subzero temperatures. It came at a cost but the residents saw the results when they remained outage free while the rest of the state struggled. 

At the end, this was yet another test of our resilience.

2020 brought a pandemic and challenged us to re-examine how we lived and where we worked. The result is a new normal that has reduced unnecessary business travel, cut down non-essential commute for people, accelerated migration to highly available cloud centric architectures and triggered digital transformations in all aspects of life.

2021 began with a frontal assault on the democratic institutions of this country and time will tell how we respond to the glaring deficiencies that it has exposed in our current systems of governance, be it in caring for large segments of society left behind through deepening income inequalities or the accelerating divide within our society caused by social media.

Though localized in Texas, this latest experience is yet another test for the country to think about a future that will be dominated by more extreme weather patterns. Our reliance on electricity is only going to increase and policy makers searching for a perfect answer to running the power market of the 21st century need to think harder. The benefits of moving away from monopolistic model of the 80s is well accepted. And yet, building resilience in infrastructure can not be left alone to the markets. Innovative regulations are the best way to strike a balance between ensuring healthy competitive markets and minimizing disruption to essential services.

Each of these challenges can be met with human ingenuity that seeks to achieve an improved end state. Or in this particular case, we let the crisis go a waste, continue with finger pointing and treat it as a temporary time travel to centuries before the advent of electricity.  

I am an optimist and am confident it will be the former.

P.S. Opinions above are purely my own and not reflective of my current or past employers and any other affiliations.