Comment by hownottowrite | Hacker News Reader

Comment by hownottowrite | Hacker News Reader

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I worked on energy trading systems in the late 90s. Everyone knew that the Texas configuration was a unique time bomb, but Texas wanted it that way. They wanted to avoid regulation and if you talked to Texans they liked the idea of being able to separate entirely from the nation.

I feel for the people who are impacted by this but they voted for this time and time again.

A further footnote here. Anyone involved in power generation keeps an eye on very long range forecasts. This current polar incursion was forecast nearly 60 days ago. Of course they might not expect it to intrude into Texas or be this severe but they knew it was a possibility. I guarantee that someone, somewhere filed reports on this not just for safety but also for profit.

Long range forecasts and data play a huge role in energy trading. Day traders are glued to the weather channel. The long range teams look at in-depth scientific reports and there are serious climate modeling systems that feed into contract calculations. I can imagine how much more complicated it is today and I wouldn’t be surprised in the least to discover that a lot of “somebodies” placed some very sure bets.

>I feel for the people who are impacted by this but they voted for this time and time again.

Not sure that everyone impacted 'voted for this', or that even the majority had an opportunity to vote on this issue specifically.

Of course not everyone voted for this. Even in reliably red or blue states there are a lot of voters who vote against whoever won. By its very size Texas has a lot of democrats in it, just not nearly as many as it has republicans.

That being said, Greg Abbott beat his democratic opponent by 13.3 points, which is a lot. He won in 2014 by 20.4 points, which is even more. And while I personally doubt that this specific issue was a campaign point, it’s hard to deny that minimal regulation and a general attitude against interdependence weren’t major campaign planks. Does anyone doubt what Abbott’s position on power regulation or connecting to the federal grid would be? Are any of his voters under the impression that Abbott would regulate power more? Certainly not.

Does that mean Texans deserve this on a moral basis? No, of course not. But a majority of their voters continually voted for leaders that have led them to this place. It’s kind of hard to know what to do for them when they keep voting for people who seem to care more about vacations and Fox News hits than actually serving their constituents.

There are also a lot of people who don't vote for anything. Maybe they should and maybe next time they will.

In any case, ERCOT and the PUC have enjoyed bipartisan support in Texas for many decades. The GOP may have their hand on the controls right now but they're not the only ones to blame.

Someone else posted "The Second Battle of the Alamo: The Midnight Connection" here: https://news.ycombinator.com/item?id=26161121

It was basically required reading for anyone in the energy sector 20 years ago, probably still is today. Maybe give it a read before you get too excited about what Texans are for and against.

Everyone? No. A majority? Probably. I think over long times and always voting for the same "feds are bad" and "regulation is bad" people you can infer that at least a significant part of the voters thought this was a good idea. Or at least an idea that was acceptable to them as part of the package they bought with their votes.

Voting for a governing body will always be a compromise. You have to decide what are the issues I cannot budge on and what are the issues I like but can live without and then find the best deal out of the available ones.

How would one trade this event to hedge / profit?

Energy trading isn't too different from other commodities, though it tends to be way more volatile. Most of the contracts are handled through ISOs (independent system operators) who handle specific regions, so it's not easy for a retail trader to get in on.

Overall it breaks into daily and long term contracts. Daily options typically trade hourly and cover generation and transportation (wheeling) costs. Long term plays are usually about securing rights at specific plants.

Personally, in a situation like this, I'd recommend taking transmission contracts on NG. Most of the Texas grid runs on it and the pricing is more stable than anything else. Also, in the event that a well head freezes up or the pressure drops, you can still get paid - or at least that's how it used to work.

"If somebody wants to build a coal-fired power plant, they can. It’s just that it will bankrupt them,"

"Under my plan … electricity rates would necessarily skyrocket."

Looks like President Obama didn't just kill coal, but killed a lot of sick and elderly too. Under real de-regulation, energy is free.

It's not just frozen water in wells. It's also the seals. Oil has some viscosity, but a pipe from -9F to 120F is something I don't want to do.

This is why I don't like changing things. You don't see that Texas freezes over, the outliers that happen twice in the last 150 years. Any further regulation will go to graft and shoring up the defunded pensions of thieves and bullying criminal liars.

The solution is to look to our ancestors. Don't focus on the crime, the grievance. State it. You're were a victim. Move on. Focus on what's next. That's really what makes people free.

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