Skip to main content

Thank you for visiting You are using a browser version with limited support for CSS. To obtain the best experience, we recommend you use a more up to date browser (or turn off compatibility mode in Internet Explorer). In the meantime, to ensure continued support, we are displaying the site without styles and JavaScript.

Profitability and investment risk of Texan power system winterization


A lack of winterization of power system infrastructure resulted in substantial rolling blackouts in Texas in 2021, but debate about the cost of winterization continues. Here we assess if incentives for winterization on the energy-only market are sufficient. We combine power demand estimates with estimates of power plant outages to derive power deficits and scarcity prices. Expected profits from winterization of a large share of existing capacity are positive. However, investment risk is high due to the low frequency of freeze events, potentially explaining the under-investment, as do the high discount rates and uncertainty about power generation failure under cold temperatures. As the social cost of power deficits is one to two orders of magnitude higher than the winterization cost, regulatory enforcement of winterization is welfare enhancing. Current legislation can be improved by emphasizing the winterization of gas power plants and infrastructure.

This is a preview of subscription content

Access options

Buy article

Get time limited or full article access on ReadCube.


All prices are NET prices.

Fig. 1: The February 2021 event in retrospect.
Fig. 2: Analysis of extreme temperatures and simulated loss-of-load events.
Fig. 3: Extreme value statistics of temperature and power deficits.
Fig. 4: Trend in loss-of-load events.
Fig. 5: Revenues from winterization.

Data availability

Aggregated climate data from ERA5 as well as results from the analysis, such as estimated load and threshold time series resulting from available capacity reduced by estimated outages and marginal winterization cost under different scenarios, are provided openly to the community on Zenodo: Data from public institutions, in particular ERCOT, the Energy Information Administration and the Texas Railroad Commission, are not available under an open license. However, within the description of the repository, links to data sources and the whole code, including download scripts, are provided so that our analysis, and in particular all figures, can be fully reproduced. Source data are provided with this paper.

Code availability

Code is published in a Github repository. The repository can be found at


  1. Bennett, J. A. et al. Extending energy system modelling to include extreme weather risks and application to hurricane events in Puerto Rico. Nat. Energy 6, 240–249 (2021).

    Article  Google Scholar 

  2. Thornton, H. E., Scaife, A. A., Hoskins, B. J. & Brayshaw, D. J. The relationship between wind power, electricity demand and winter weather patterns in Great Britain. Environ. Res. Lett. 12, 064017 (2017).

    Article  Google Scholar 

  3. Höltinger, S. et al. The impact of climatic extreme events on the feasibility of fully renewable power systems: a case study for Sweden. Energy 178, 695–713 (2019).

    Article  Google Scholar 

  4. Pallone, F. MEMORANDUM Hearing on “Power Struggle: Examining the 2021 Texas Grid Failure” (2021).

  5. Busby, J. W. et al. Cascading risks: understanding the 2021 winter blackout in Texas. Energy Res. Soc. Sci. 77, 102106 (2021).

    Article  Google Scholar 

  6. Wu, D. et al. An open-source extendable model and corrective measure assessment of the 2021 Texas power outage. Adv. Appl. Energy 4, 100056 (2021).

    Article  Google Scholar 

  7. Doss-Gollin, J., Farnham, D., Lall, U. & Modi, V. How unprecedented was the February 2021 Texas cold snap? Environ. Res. Lett. 16, 064056 (2021).

  8. Bajo-Buenestado, R. Operating reserve demand curve, scarcity pricing and intermittent generation: lessons from the Texas ERCOT experience. Energy Policy 149, 112057 (2021).

    Article  Google Scholar 

  9. D’Andrea, A. C. Preliminary Report on Causes of Generator Outages and Derates for Operating Days February 14–19, 2021 Extreme Cold Weather Event. Access to the document is geo-restricted to the US (ERCOT, 2021);

  10. ERCOT. Generation Resource and Energy Storage Resource Outages and Derates, February 14-19, 2021. Access to the document is geo-restricted to the US (ERCOT, 2021);

  11. Cohen, J., Agel, L., Barlow, M., Garfinkel, C. I. & White, I. Linking Arctic variability and change with extreme winter weather in the United States. Science 373, 1116–1121 (2021).

    Article  Google Scholar 

  12. Sheridan, S. C. & Lee, C. C. Temporal trends in absolute and relative extreme temperature events across North America. J. Geophys. Res. Atmospheres 123, 11889–11898 (2018).

    Article  Google Scholar 

  13. Starn, J. & Chia, K. Sweden shows Texas how to keep turbines going in icy weather. Bloomberg (2021).

  14. Mays, J. et al. Private risk and social resilience in liberalized electricity markets. Joule (2021).

  15. King, C. W. et al. The Timeline and Events of the February 2021 Texas Electric Grid Blackouts (Univ. of Texas at Austin Energy Institute, 2021).

  16. Zou, I. Texas power generation companies will have to better prepare for extreme weather under bills Gov. Greg Abbott signed into law. The Texas Tribune (2021).

  17. ERCOT. Seasonal Assessment of Resource Adequacy for the ERCOT Region (SARA) Winter 2020/2021. Access to the document is geo-restricted to the US (ERCOT, 2020);

  18. Laaha, G. et al. The European 2015 drought from a hydrological perspective. Hydrol. Earth Syst. Sci. 21, 3001–3024 (2017).

    Article  Google Scholar 

  19. Yevjevich, V. M. An Objective Approach to Definitions and Investigations of Continental Hydrologic Droughts. PhD thesis, Colorado State Univ. (1967).

  20. Tallaksen, L. & van Lanen, H. (eds) Hydrological Drought. Processes and Estimation Methods for Streamflow and Groundwater (Elsevier, 2004).

  21. Koffler, D., Gauster, T. & Laaha, G. lfstat: calculation of low flow statistics for daily stream flow data (2016).

  22. Gustard, A. & Demuth, S. Manual on Low-Flow Estimation and Prediction (World Meteorological Organization, 2008).

  23. ERA5 Monthly Averaged Data on Single Levels from 1979 to Present (Copernicus Climate Change Service, 2019).

  24. Gridded Population of the World (GPW) v.4.11 (Center For International Earth Science Information Network at Columbia Univ., 2018).

  25. Hoen, B. et al. United States Wind Turbine Database (US Geological Survey, 2018);

  26. Maps (US Energy Information Administration, 2020);

  27. Douglas, E. Gov. Greg Abbott wants power companies to “winterize.” Texas’ track record won’t make that easy. The Texas Tribune (2021).

  28. Texas Oil and Gas Production by County (RRC, 2020);

  29. Hourly Load Data Archives – ERCOT. Access to the document is geo-restricted to the US (ERCOT, 2021);

Download references


We gratefully acknowledge support from the European Research Council (‘reFUEL’ ERC2017-STG 758149; J.S.). We are grateful to E. Virgüez, who provided spatial locations of power plant outages and with whom we exchanged early results, and to S. Wehrle with whom we extensively discussed the paper.

Author information

Authors and Affiliations



Conceptualization: K.G., T.G., P.R., G.L. and J.S.; software: K.G., T.G., P.R. and J.S.; investigation: K.G., T.G., P.R., G.L. and J.S.; writing the original draught: K.G., G.L., P.R. and J.S.; reviewing and editing the paper: K.G., T.G., G.L., P.R. and J.S.; visualization: K.G., T.G. and P.R.; supervision: J.S.; and funding acquisition: J.S. K.G. and J.S. equally contributed as first authors to the manuscript.

Corresponding author

Correspondence to Katharina Gruber.

Ethics declarations

Competing interests

The authors declare no competing interests.

Peer review

Peer review information

Nature Energy thanks Peter Cramton, Le Xie and the other, anonymous, reviewer(s) for their contribution to the peer review of this work.

Additional information

Publisher’s note Springer Nature remains neutral with regard to jurisdictional claims in published maps and institutional affiliations.

Supplementary information

Supplementary Information

Supplementary Notes 1–6, Figs. 1–13, Tables 1 and 2 and Methods.

Source data

Source Data Fig. 1

Time series of load, available capacity, outages and temperatures.

Source Data Fig. 2

Time series of estimated load and available capacity.

Source Data Fig. 3

Description of outage events.

Source Data Fig. 4

Year and size of events.

Source Data Fig. 5

Bootstraps of marginal revenues of loss-of-load events for winterization of one additional gigawatt for all technologies.

Rights and permissions

Reprints and Permissions

About this article

Verify currency and authenticity via CrossMark

Cite this article

Gruber, K., Gauster, T., Laaha, G. et al. Profitability and investment risk of Texan power system winterization. Nat Energy 7, 409–416 (2022).

Download citation

  • Received:

  • Accepted:

  • Published:

  • Issue Date:

  • DOI:


Quick links

Nature Briefing

Sign up for the Nature Briefing newsletter — what matters in science, free to your inbox daily.

Get the most important science stories of the day, free in your inbox. Sign up for Nature Briefing