The Fable Of The Pirkey Power Plant (As Told By Texas State Senator Bryan Hughes)

Summary of the Fable

Evil fossil gasoline devouring Monster Asset Managers (MAMs) compelled Princess AEP to prematurely kill her beloved youngster Pirkey. Jobs and warmth for houses have been misplaced. Youngsters starved within the chilly. Offended gods showered Storm Uri upon the Kingdom of Texas. Aided by the crafty and malicious Renewable Power Orcs, your entire Kingdom was forged into ice. All of Center Earth was practically misplaced. With the assistance of Chairman Gandalf, a small committee of lovely Elves requested the courageous Dwarfs to herd the MAMs to the Shire of Marshall. In entrance of the entire native Hobbits, the Elves forged a magical spell upon the MAMs to verify this might by no means occur once more.

A lot has been written in regards to the December 15, 2022, Texas Senate Committee on State Affairs listening to wherein the committee grilled Dalia Blass (Senior Managing Director and Head of Exterior Affairs at BlackRock, Lori Heinel (International Chief Funding Officer of State Road), and Lorraine Kelly (International Head of Funding Stewardship Options at ISS). The day earlier than, Committee Chairman Bryan Hughes (R-Mineola) (he of a neatly trimmed, barely graying beard and a fashionably lengthy however tasteful hairstyle) graciously dismissed John Galloway, Vanguard’s International Head of Funding Stewardship. Mr. Galloway was saved the lengthy journey ✈️ from Malvern (inhabitants of three,419) to the comparatively bustling metropolis of Marshall (with a inhabitants of round 23,000) since Vanguard had expeditiously withdrawn from the Internet-Zero Asset Managers Alliance per week earlier than.

Sadly, I’d already moderately booked myself for December 15 and didn’t have the chance to pay attention to the hearings, kindly broadcasted stay for all to see—free of charge! I then bought busy (you understand how these items go as the vacations strategy) and it was solely yesterday that I had the chance to observe over six hours of riveting political theater in Half I (2’ 43”) and Half II (3’ 50’). (Texas hospitality get everybody a lunch break!) Not fairly so long as Components I (”An Surprising Journey”) and II (”The Battle of the 5 Armies”) of “The Hobbit” which gave me hope for a Texas Half III (”The Desolation of Smaug”)! So I popped myself some popcorn 🍿, grabbed just a few chilly beers 🍺, and sat down for the present.

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In his delicate and lilting Texas drawl Chairman Hughes graciously and warmly welcomed all of the company to Marshall, a “stunning piece of historical past (the primary metropolis in Texas to have telegraph service with a line that linked to New Orleans) and nonetheless making historical past (perhaps by these hearings?).” He additionally thanked the parents from Marshall for letting them be there for “ time right this moment (undecided their out-of-town company felt that means, however they’ll converse for themselves), a worthwhile time (I assume that relies on the that means of “worthwhile”), an vital time (solely time will inform).” He additionally proudly famous that in Texas hearings “actual individuals get to return and testify.” Contemplating myself an actual individual, that caught my consideration. It generated some hope for a cameo look within the widespread new TV 📺 collection “Pink States Boycott the Boycotters”!

Since I’m not an expert film critic, I don’t have the abilities to put in writing a pithy abstract which is able to encourage (or not) a possible viewer, with sufficient engaging tidbits but not gifting away the dramatic ending, to see the present. Given these limitations, I’ll merely concentrate on a brief phase of 4 minutes and 37 seconds, beginning at 47’ 48” and ending at 51’ 25”in Half I.

I do know lots about ESG, however I do know just about nothing about lignite coal mines, utility energy vegetation, the vitality grid, and the vitality scenario in Texas. I noticed this as a studying alternative! At the same time as I enter my eighth decade, I’m at all times eagerly looking for new information. Chairman Hughes’s feedback definitely gave me a possibility to take action. Let me share with you what I feel I discovered, however as an vitality neophyte I might effectively have gotten some issues flawed.

Spoiler alert. Like a lot of the rhetoric of the anti-ESG crowd, there’s this patriotic fervor about free markets whereas unabashedly ignoring their actuality and even making an attempt to intervene with them. On this case it’s coal vs. renewables. I’m glad I nonetheless wasn’t consuming popcorn after I did some observe on analysis on the 4 minutes and 37 seconds I watched, or I may need choked on it. Extra on this under.

The Chairman identified that the vitality dialogue was not merely about oil and fuel vs. renewable vitality but in addition about coal, a “clear burning vitality and dependable vitality and good jobs.” I feel I perceive the idea of dependable vitality, however I’m puzzled in regards to the clear vitality declare. In response to the U.S. Power Data Administration, coal has the biggest carbon footprint at 211.87 kilos of CO2 per million BTUs. By comparability, diesel and residential heating gasoline is 163. 45 and pure fuel is 116.65.

When it comes to jobs, again in April 2018 the Texas Comptroller’s officer, below Glenn “Chuck” Hegar, posted an article “Photo voltaic Energy in Texas: The Subsequent Huge Renewable?” (Yep, the identical Chuck Hegar who ran for re-election driving the anti-ESG wave browsing the ludicrous Texas Part 809 Boycott Provision which I’ve already dissected.) The article enthusiastically begins “Ten years in the past, Texas’ photo voltaic business was pretty small, however right this moment some imagine it’s able to tackle a a lot bigger share of the state’s vitality wants.” It proudly famous that Texas ranked seventh within the nation by way of cumulative photo voltaic capability and fourth by way of photo voltaic jobs (8,872 vs. 1,037 in coal). (Redder and redder Florida can be within the prime 10 on each counts.) The article additionally identified the irony that “the oil and fuel growth prompted by hydraulic fracturing and different enhanced restoration strategies has influenced electrical energy markets in renewables’ favor, driving down gasoline prices and making each coal and nuclear vitality much less aggressive on value. In impact, it’s lowered the worth factors at which energy producers should compete.”

I’ve nothing however respect for coal miners. Coal mining is tough and harmful work that results in elevated threat of coronary heart and lung ailments and limits life spans. I additional recognize the necessity for individuals who work in coal mining communities to feed their households and educate their kids. What I’m wondering is whether or not there will be different and higher jobs for these individuals as coal mining jobs disappear—as they’ve been for many years—pushed by financial, technological, and regulatory forces.

So it’s honest to ask what has occurred in Marshall. Like at all times, it’s good to get the details from native sources on the bottom. In response to The Marshall Information Messenger, “Sabine Mine President Andy Hawbaker mentioned all however 26 of the mine’s round 130 workers have already discovered work exterior the mine.” It additional famous the work of the “Simply Transition Fund, a nonpartisan grantmaking group serving to coal communities navigate financial transitions away from fossil fuels.” It additionally identified that “ Pirkey will go away behind substation and technology infrastructure at Pirkey Lake that [AEP External Affairs Manager Mark] Robinson mentioned AEP might doubtlessly make the most of for photo voltaic vitality manufacturing.”

Senator Hughes gravely famous that the 36 year-old Pirkey Energy Plant had “many years and many years of life left” to supply nice jobs. (Traditionally energy vegetation have a mean lifespan of 46 years.) He additionally darkly asserted that AEP “needs to close that plant down, prematurely” and ominously warned that he has “proof that AEP has been focused by the very companies we’re going to speak to right this moment.” Oh, what drama! The life and demise of an influence plant and its lignite coal mine sibling! Maybe a untimely demise on the sword of some large asset managers! What might make for a extra gripping story on a sluggish information day in bustling Marshall?

I checked out AEP’s prime shareholders. Shurnuff, the Huge Three all of those pink states are railing about are the three largest shareholders within the firm: Vanguard (8.80 p.c, however perhaps now a buddy?), BlackRock (5.86 p.c ), and State Road (5. 39 p.c) have a whopping collective 20.5 p.c. Greater than sufficient to push this firm round and make them shut that plant with the coal mine as collateral injury. I figured that if this have been true, AEP would have loudly complained about this gross injustice.

As an alternative, what I discovered was that this transfer is a part of a broader world technique of AEP to shutter about half of its coal-fired energy fleet. “Economics are a significant factor in AEP’s spate of lately introduced closures. The corporate, like different U.S. coal mills, is grappling with refining price estimates of complying with environmental guidelines towards numerous components.” In 2020 the corporate estimated that that future investments to satisfy current and proposed necessities might vary from about “$500 million to $1 billion by 2026.” At this level, I’m nonetheless okay with my popcorn.

After all, the Supreme Court docket’s ruling towards the EPA in “WEST VIRGINIA ET AL. v. ENVIRONMENTAL PROTECTION AGENCY ET AL.” may cut back these prices however future laws might conceivably make them increased. It’s powerful for firms having to make long-term funding choices relating to vitality sources in a altering political, geopolitical, financial, technological atmosphere.

The story is larger than Marshall. It’s about the entire state of Texas. Aesop Hughes ruefully recalled and reminded the viewers a number of occasions of Winter Storm Uri which slammed Texas final yr. “My goodness,” he solemnly intoned with a slight shake of his head, “I feel we discovered in Texas a yr in the past we’d like extra dispatchable vitality, not much less.” (I didn’t know what dispatchable vitality was so regarded it up. Principally vitality you possibly can activate and off at will.) One other Senator sagely commented that “wind and photo voltaic solely operates when it chooses to.” (So there aren’t any batteries in Texas?) The argument right here is that by some mystical power a plant that was nonetheless working in some way contributed to a close to break down within the Texas vitality grid.

Not realizing something about electrical grids, I checked this out after the present. I’m glad I wasn’t consuming popcorn since now I might have absolutely choked 🤮. In response to Sustainable FERC Challenge, the explanation this storm left 4.5 million individuals with out energy for days, killed 248 individuals, and value the financial system $195 billion in damages—making it the biggest catastrophe in state historical past—”is that counting on fuel [NB: not coal] poses critical dangers, and {that a} robust, nimble grid is totally important.” The scenario was exacerbated by the truth that the Lone Star state likes to go it alone in terms of electrical energy “as a result of a lot of the state is {an electrical} island with very restricted connections to neighboring states.”

Earlier than focusing his glare on Ms. Blass and Ms. Heinel, at 51’ 25” Chairman Aesop bought slightly assist from his buddy Senator Lois Kolkhorst by giving her a possibility to contribute to the fable. She referred to somebody as her “favourite professor” as a result of he talked about “politicization” (which she stumbled over saying it a few occasions resulting from, she mentioned, the dearth of espresso and an early begin). I’ll skip the plain irony of who’s doing the politicization. Extra importantly, she didn’t point out the professor’s identify. However because it’s not me it doesn’t matter. And I’m jealous.

Senator Kolkhorst talked about how China burns 25,000 tons of coal and we burn 2,500 per yr. She complained about an “unlevel enjoying discipline” as a result of China (and Saudi Arabia, Russia, and India) don’t care about their ESG scores (ummm, Senator, firms get ESG scores, not international locations) and easily care about offering low cost vitality for his or her economies. “ESG is working to tear American down,” the Senator cried! (Each time I flip across the energy of ESG to wreak destruction on al facets of life in America appears to develop in Pink State Minds.) She didn’t point out that China might exceed its renewable vitality goal of 33 p.c by 2025 (it was 12.4 p.c within the U.S. in 2021) or that China is successful the race for clear vitality expertise.

In conclusion, the Senator rued the truth that “We lead the nation in renewables to the detriment of our residents as we noticed in Uri.” (I might really feel her channeling “Gimme Shelter.”) This caught my ear since I’d already discovered from Mr. Hegar’s workplace that Texas was making nice strides in renewable vitality. I questioned if he’d seen the error of his methods after struggling by Uri. It’s in researching this that I used to be glad I’d run out of popcorn. In any other case, I may need choked and died and never be right here to inform this fabulous story. I additionally wished I’d grabbed a few whiskies 🥃 with beer chasers to extra totally recognize the sheer inanity of the listening to.

Two months earlier than the December 15 Marshall Monster Mash, which generated extra warmth than mild on the vitality scenario in Texas, the Comptroller’s Workplace printed “Texas’ Power Profile A Overview of the State’s Present Conventional and Renewable Power Capabilities.” (Yep, Chuck gained the re-election so it’s him once more!) It offers an insightful evaluation of the evolving position of renewable vitality assets in Texas that may be captured in three factors:

1. Texas leads the nation in vitality manufacturing and consumption, being the biggest producer of oil (43 p.c), pure fuel (25 p.c), and wind-powered electrical energy (26 p.c).

2. Regardless of these capabilities, limitations within the present Texas infrastructure (e.g., transmission traces and battery storage) make it “unable to transmit and retailer all of the electrical energy generated by renewable vitality sources, together with wind and photo voltaic.”

3. Thus, Texas wants a various vitality portfolio, together with oil and fuel sources, to make sure sustainable and value efficient vitality manufacturing. (Film viewer’s question: Was coal not talked about on function or was this simply an editorial oversight?)

And ya gotta love the closing quote from Mr. Hegar: “We should work collectively to advance well timed, sensible options that develop renewable vitality, whereas acknowledging the continued significance of a diversified vitality portfolio. Our financial well being and well-being rely upon it.” In all sincerity this makes excellent sense to me. I don’t anticipate oil and fuel to utterly disappear ever, though we have to wean ourselves away from it as shortly as we will inside coverage, financial, technological, and geopolitical constraints.

Right here’s the place I’m confused. Keep in mind, I’m an ESG man, not an vitality man 😍. Did I hear it proper that Senator Kolkhorst is throwing shade at her fellow Texan Mr. Hegar? So if he’s the actual drawback, why drag Ms. Blass, Ms. Heinel, and Ms. Kelly for a pre-holiday journey to the stunning little city of Marshall for a mindless dialog? Why not haul in Mr. Hegar (in shackles, if essential) and sternly demand that he clarify himself? And inform him that if he isn’t boy and alter his methods he’s solely going to get coal in his stocking for Christmas! Truly, that might an indication of affection from her, so I take that again. As an alternative, he’ll get a photo voltaic panel.

Summary of the Actuality

The vitality transition is an advanced one that can take time and can contain a mixture of gasoline sources for many years to return. Renewables have an vital position to play however they aren’t a silver bullet. Infrastructure by way of transmission traces and grid-scale battery storage must be developed. Asset managers must rigorously allocate their capital throughout firms producing completely different sources of vitality. Public coverage has an vital position to play. In some ways Texas is exhibiting constructive management. In different methods Texas is placing America’s vitality safety and skill to realize aggressive benefit in clear expertise in danger. By holding hearings which are utterly divorced from actuality, Texas politicians are making it tougher for America to do what must be accomplished.

Ultimately, actuality trumps (cute, proper?) fables.

Jean Nicholas

Jean is a Tech enthusiast, He loves to explore the web world most of the time. Jean is one of the important hand behind the success of mccourier.com