AUSTIN — The Texas Railroad Commission on Tuesday narrowed a notorious $150 weatherization waiver, making it tougher for natural gas producers to opt out of prepping their wells for the winter.
The changes to the proposed rule come after the commission was excoriated in a September Senate committee hearing over the rule and a lack of weatherization standards for the oil and gas industry that plays a critical role in powering Texas’ electric grid.
The commissioners unanimously approved the new rules that make a few notable changes. They added a process by which the Railroad Commission can reject a gas producer’s request to opt out of weatherizing their wells by paying the $150. The rule also creates classifications for natural gas producers, with the producers of the largest volumes of gas placed into a critical category that will be mandated to weatherize.
Commissioner Jim Wright said the commissioners needed to find a way to keep enough gas production online during a weather crisis to meet demand while not unintentionally over-taxing Texas’ electric grid.
“The challenge is this,” Wright said, “we must keep operators who are supplying large quantities of gas online, but if we list everyone as critical and maintain their access to electrical power during peak demand, it severely reduces the amount of electricity available to residents and families who need it.”
Leading up to Tuesday’s meeting, hundreds filed comments with the Railroad Commission calling for them to eliminate the $150 waiver. In a public filing, the American Public Gas Association called it an “exemption that swallows the rule.”
The Railroad Commission has also faced growing scrutiny in recent weeks after escaping much of the blame following February’s widespread power outages during the deadly winter storm that killed more than 200 Texans.
And Tuesday’s vote was one of the most high-profile actions the esoteric and oddly named commission — it regulates Texas’ oil and gas industry as opposed to trains — has seen in recent memory. Democratic Texas gubernatorial candidate Beto O’Rourke even promoted the meeting Tuesday morning in a tweet, calling on Texans to “hold them accountable,” along with a link to the meeting’s livestream.
Leading up to the vote, Chairman Wayne Christian spent several minutes blaming the media for finger pointing at the Railroad Commission and the natural gas industry, while also stating that the Biden administration, the Texas Legislature and incentives for renewable energy were the real culprit for much of the recent criticism of the commission.
In calling for the industry to fully utilize natural gas storage facilities, Wright also compared natural gas producers’ decisions to shut down their wells to the fast food chain Chick-fil-A famously being closed on Sundays.
“One thing I can’t say and tell you with certainty, if you want to eat a Chick-fil-A sandwich on Sunday, you’re going to need to buy it in advance,” Wright said. “The same is true for natural gas.”
The sole Democratic challenger to Christian, former Texas Democratic Party strategist Luke Warford, said Christian’s comments were “an embarrassment.” Christian, a Republican, is up for reelection in 2022.
“Texas is not prepared for winter, and Wayne Christian and the Commission are to blame for squandering the past 10 months, failing to identify critical infrastructure and failing to work with gas companies to winterize,” Warford said.
Virginia Palacios, executive director of the group Commission Shift, which is critical of the Railroad Commission, said that the changes made from the proposed rules were “an improvement” and that the commission made valuable clarifications that closed some gaps.
Regardless, the approval of the new rules does little to weatherize Texas’ natural gas infrastructure. The two key laws the Legislature approved this year to address the failures of the state’s power grid do not require natural gas wells to be prepared for winter weather until March 2023.
It means that large sectors of Texas’ power-generating infrastructure remain vulnerable. Earlier this month, the power grid’s operator, the Electric Reliability Council of Texas, underscored this in releasing a seasonal report that showed Texas would face a severe shortfall in energy if the state experiences a weather event even approaching February’s winter storm.
CORRECTION, 10 p.m., Tuesday, Nov. 30: An earlier version of this story attributed quotes about Chick-fil-A sandwich purchases and natural gas purchases to Railroad Commissioner Wayne Christian. Commissioner Jim Wright made the comments.
