CEO of Texas power grid operator “terminated” in aftermath of winter storm

CEO of Texas power grid operator “terminated” in aftermath of winter storm
ERCOT CEO Bill Magness. (Source: Texas A&M Smart Grid Center)

By Erin Douglas and Mitchell Ferman, The Texas Tribune

March 3, 2021

CEO of Texas power grid operator “terminated” in aftermath of winter storm” was first published by The Texas Tribune, a nonprofit, nonpartisan media organization that informs Texans — and engages with them — about public policy, politics, government and statewide issues.

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The board overseeing the Electric Reliability Council of Texas, the independent nonprofit entity that operates and manages the electricity grid that covers much of Texas, fired ERCOT CEO Bill Magness Wednesday night.

The move by the board to vote in favor of a “60-day termination notice” came after they convened in a private executive session for more than three hours. The board barely discussed its decision once returning to the public session.

The decision is the latest of several recently announced departures from the ERCOT board, which also included Magness. Five board members resigned in late February after public criticism that many board members did not reside in Texas. Magness’s absence leaves a mix of vacancies and temporary members on the 16-member ERCOT board. ERCOT and the Public Utilities Commission of Texas, the regulatory body that oversees it, have been lambasted in recent weeks for failures preparing for and responding to the winter storm that left millions of people in the dark for days and claimed the lives of dozens.

On Monday, Lt. Gov. Dan Patrick had called for both Magness and the chair of the PUC, to resign. DeAnn Walker, the former chairwoman for the PUC, resigned that same day. She had come under sharp criticism by lawmakers after largely pointing blame for Texas’ power outages to ERCOT, the entity her agency oversees. Gov. Greg Abbott on Wednesday named Walker’s replacement.

Magness, who endured more than five hours of questioning by state senators Thursday, was criticized for the organization’s preparations for a winter storm. ERCOT underestimated the maximum amount of power that would be demanded by homes, businesses and industry during a severe winter storm in its fall projections, and it overestimated the amount of power generation that would be available to the grid during such a storm.

When massive amounts of power began to trip offline in the early hours of Feb. 15, well beyond what was expected, ERCOT grid operators were forced to order utility companies to start controlled outages to prevent the entire system from collapsing. Legislators complained that the grid manager didn’t do enough to alert state leaders or the public to the coming disaster.

In his testimony last week, Magness defended ERCOT’s handling of the outages, telling lawmakers that if ERCOT operators had not acted as they did, “the suffering we saw last week would be compounded” and Texans would likely be without power for weeks. Magness also defended ERCOT as an entity that carries out what state lawmakers and the PUC direct.

“The commission approves the policy, we implement it,” Magness said.

Magness told lawmakers he earns $803,000 annually, which he said comes from Texans paying their electric bills.

Magness did not speak about the board’s decision, only that he abstained from the vote because it involved himself. Magness also said he was not present for any relevant discussion in the private executive session.

Walker, who testified after Magness during the hearings with lawmakers, said she disagreed with his characterization of how much oversight the PUC had of ERCOT, and said the commission has “not been given legal authority by the Legislature to require winter weatherization,” a primary concern after the power crisis was precipitated by power plants tripping offline. Many power generators are not built to withstand extreme cold weather temperatures in Texas.

Magness worked at ERCOT for more than a decade and became its CEO and president in 2016 after working as its general counsel. He previously held executive management positions in the public and private utility sectors. A lawyer, he also previously worked as lead counsel in state and federal regulatory matters.

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