Wednesday, March 3, 2021

"Chaos Looming In Texas As The Power Crisis Triggered Food And Water Shortages And Business Collapse"

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"Chaos Looming In Texas As The Power Crisis Triggered
 Food And Water Shortages And Business Collapse"
by Epic Economist

"Texas remains the epicenter of chaos and disaster in America, as a prolonged arctic blast recently caused storms and unusual freezing temperatures that overwhelmed the state's power grid, leaving millions without electricity, heating, and several other essential services for days. The disruption also triggered alarming food and water crises all across the state, and now, the Lone Star is having to confront the harsh reality that the conveniences of modern life are not as guaranteed as we've previously imagined. Texas power crisis was a reminder to the rest of our country that our modern society relies upon systems that are too overly complicated and incredibly easy to disrupt. Even though the outages are over, the damages have only started to arise.

Since residents sought protection from the chillwave, demand for power skyrocketed, and prices soared from 12 cents per kilowatt-hour to $9 per kilowatt-hour. Some Texans reported electricity bills of over $9,000, as energy providers were seemingly taking advantage of "variable-rate power plans" to overcharge consumers that were already deeply distressed. Moreover, economists are arguing that once the situation is finally under control, a massive wave of bankruptcies is likely to be witnessed, as local businesses are still calculating the extent of the damages and losses suffered so far. And that's what we are going to expose in this video.

The ravaging crisis Texas is facing at the moment is evidencing how America's aging infrastructure is crumbling. Temperatures hit record-lows, and without heating, some locals were left with no alternative other than running their cars to try to stay warm. However, more than 500 cases of residents who were fatally poisoned by their car's carbon monoxide release were registered up until this point.

For weeks, stores have been reporting shortages of basic food staples, and several cities are under a boil water advisory, as the local water reservoirs were contaminated. But with no power or gas, many are having to make the hard choice of either going potentially sick or going thirsty. On top of the troubles residents are having to face at home, many of them have reported having problems at work too, and consequently, in their monthly wages. According to a recent report published by the Texas Tribune, "many hourly wage employees across the state lost working hours last week during the storm and power outage disaster. Now, they’re left with a choice between paying for rent or groceries". 

Some of the most affected by the crisis have seen their electricity bill hit sky-highs as wholesale prices were set at $9/kWh - almost 300 times higher than the normal wholesale price. The state's utility company Griddy Energy charges $10 a month to allow residents to pay wholesale prices for electricity instead of a fixed rate. The prices surged as temperatures dropped well below freezing, leaving customers with extremely high power bills. Lisa Khoury, a Texas resident, disclosed to have received a $9,300 electricity bill. Khoury alongside multiple other customers, filed a class action lawsuit against the company. 

Texas Attorney General Ken Paxton accused the company of "misleading and deceptive advertising and marketing practices". "Griddy misled Texans and signed them up for services which, in a time of crisis, resulted in individual Texans each losing thousands of dollars," Paxton stated. "As Texans struggled to survive this winter storm, Griddy made the suffering even worse as it debited outrageous amounts each day". 

On Sunday, Brazos Electric Power Cooperative, the largest and oldest electric power cooperative in Texas, filed for bankruptcy after accumulating an estimated $2.1 billion in charges. The company owes Ercot a disputed $1.8 billion in collateral. Ercot, which is the state's grid operator, said that overall, there is at least $2.46 billion in unpaid bills, exposing the financial setbacks faced by many other utilities, power retailers, and generators. Brazos and several others whose contract agreed to provide power to the grid, but failed to do so, were forced to buy replacement power at high rates and make up for other firms’ unpaid fees. 

As the staggering amount of debt is still piling up, many experts have been arguing that more bankruptcies will follow over the coming weeks. However, the main concern surrounds local businesses that have been struggling throughout the recession, many of which have compromised their insurance payments to keep doors open, and now are facing hundreds of thousands of dollars in property damages. A massive spike in lay-offs is also being predicted to echo in next week's unemployment report. But as the extent of the losses is yet to be assessed, the following weeks will be decisive for the state's economy. There's no doubt we will have enormous challenges ahead"

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