For those of us who thought the global anomalies of 2020 were behind us, 2021 quickly reminded us that strange is the new norm. While families were attempting to get their lives back to COVID-normal, a historic winter storm devastated our great state and overwhelmed our communities. Yet, despite a full plate and lean resources, elected officials were busy responding to these disasters while simultaneously addressing the basic needs of all Texans. In the midst of an unprecedented start to 2021, let’s not forget that we are also in the middle of one of the most important legislative sessions Texas has ever encountered.
Here are a few things to look out for and why they are important to you:
• Storm bills. Elected officials throughout the state have pledged to do better in preparing for extreme weather events. To “do better” requires an evaluation of what worked, what failed and what can be improved in a way that has real results. While failures occurred up and down the line of our state’s electricity system, a new analysis of natural gas performance during the storm indicates that loss of power, which began after outages began at power generation units, was the principal factor for natural gas production and transportation reductions and shutdowns. TXOGA President Todd Staples said, “Texans deserve a thoughtful and factual evaluation of what really went wrong. Moving forward, the most immediate action to ensure natural gas facilities can operate during emergencies will be supply chain mapping to determine which natural gas production, distribution and storage facilities feed into the natural gas electricity generation and local distribution companies.”
Most people don’t realize just how vast and complicated our electricity supply chain is. Energy on demand has made many of us far removed from the technical aspects of how we power our homes. Now is the time to bridge the energy discussion and find common ground between all energy sources. Renewables are a critical part of our energy portfolio, and despite some media headlines, the oil and natural gas industry invests significantly in solar and wind. Yet, during a crisis, you must be able to immediately dispatch resources, and natural gas did just that. On an annual basis, natural gas represents about 48% of Texas’ electric power generation. During the storm, natural gas increased its percentage of the Texas power generation mix, supplying more than 60% of electricity generation every single day between Feb. 11 and Feb. 18. Together, all energy suppliers and electricity generators must find better ways to ensure the power stays on. Any legislation must ensure the supply chain is communicating and can continue to produce and move the natural gas necessary to ensure our Texas families have the power and heating necessary to stay safe during a crisis.
With less than a month left in the legislative session and with the storm dominating much of the conversation, there are many issues that could impact our oil and natural gas industry, which provides critical resources for heating and cooling our homes, feeds our electricity generators and provides fuel for our transportation needs.
• Eminent Domain. These two words can create real challenges amongst utilities, pipeline companies, developers and landowners. In reality, most right-of-way acquisition deals are entered into freely and voluntarily. However, when eminent domain does come into play, it is important to have a transparent and reliable process to ensure everyone has the information and resources they need to come to a final resolution. In order to continue our collective economic success, Texans must be able to support infrastructure development while protecting landowner rights.
Fair and agreed-to eminent domain legislation allows critical infrastructure to continue to be built and ensures that landowners are informed, treated fairly and compensated fairly during the process.
• Prohibition on natural gas bans. The Texas Legislature is moving to pre-emptively prohibit California-style city ordinances that ban natural gas in homes or businesses. If the recent winter freeze taught us anything, it’s that natural gas is reliable and essential to fueling Texas homes and businesses. At the height of Winter Storm Uri, natural gas provided 67% of all power generation in Texas. Without natural gas, millions more Texans would have been without heat and power. Banning a person’s freedom to choose their source of energy for their home or business is bad for consumers, the economy, and it is bad for Texas
• Chapter 313 extension. Chapter 313 is an economic development tool that school districts can use to incentivize businesses to locate in their district. The program is set to expire in December 2022 if the state takes no action this session. For small communities with limited resources to attract jobs and businesses to their areas, this means that they will no longer have this valuable tool to provide an edge over their competition in economic development. This session, lawmakers are reviewing the benefits of Chapter 313 and considering its extension.
We share these issues with you because they will have an effect on the economic engine of Texas. As the Legislature studies these issues over countless hours of testimony and research by experts and staff, we are confident that in the Lone Star State, the health and prosperity of our residents will be the overriding consideration when the last vote is counted. However, without open communication and dialogue, we are doomed to spin our wheels in meaningless debate.
The most important takeaway we can benefit from post-2020 is that accurate and timely communication is key to bridging any debate and finding compromise. The oil and natural gas industry must continue to showcase our efforts and our support for the communities and the environment we live and work in while also providing energy for Texas and the United States. At the South Texas Economic & Energy Roundtable, we will continue traveling thousands of miles each year to ensure the voices of rural Texas are heard and considered, while also ensuring the urban counties have the support they need to continue moving forward in a positive direction. So, let’s communicate. Let’s dialogue. Our door is open to everyone.