By Chris Tomlinson
September 8, 2023
Donors tied to 36 natural gas pipeline and trading companies accused of causing or profiteering from the 2021 blackouts have given $6.3 million to the top seven elected officials overseeing the industry since 2017, a new analysis from Texas for Public Justice revealed Friday.
Perhaps that explains why no Texas official is looking into fraud and market manipulation accusations that attorneys general in Kansas and Oklahoma find so concerning. Or maybe Texas Attorney General Ken Paxton has been too busy doing other things to read the lawsuit brought by CirclesX, a Houston energy data firm.
Texans for Public Justice took on the tough job of going through thousands of pages of campaign finance data after reading my series explaining how pipeline companies seeking to boost profits are alleged to have triggered four days of blackouts during Winter Storm Uri in 2021.
“Texas is sick with oil money,” Public Citizen Texas Office Director Adrian Shelley said. “There’s no other explanation for lawmakers downplaying the role of fossil fuels in the Winter Storm Uri disaster while cashing six- and seven-figure checks from the industry.”
Gov. Greg Abbott appoints the Public Utility Commission, which oversees the Texas electricity grid, and received $4,258,597. Lt. Gov. Dan Patrick presides over the Senate, which oversees state agencies, and received $799,337.
Railroad Commissioner Christi Craddick, the longest-serving commissioner at the agency charged with regulating natural pipelines, received $380,174. The other commissioners, Jim Wright and Wayne Christian, received $210,202 and $202,801, respectively.
Pipeline-connected donors gave House Speaker Dade Phelan $317,253 and Paxton $161,702.
“We need state oversight officials to have the ability to take a sober look at the data and relevant facts so that we can prevent more disasters and pollution in the future,” explained Virginia Palacios, who as executive director of Commission Shift advocates for stronger oversight. “The structure of campaign finance in Texas is allowing the oil and gas industry to pump millions into elected officials’ campaigns, clouding their judgment and making life more expensive and difficult for ordinary Texans.”
Texas law forbids companies from making campaign donations, but individuals may give as much as they want. Large donors must report their employer’s name or any relevant corporate affiliations.
People affiliated with Energy Transfer Partners, which made $2.4 billion in excess profits during the storm, gave Texas politicians the most. Led by CEO Kelcy Warren, who wrote a $1 million check to Abbott’s campaign, Energy Transfer executives donated $3,240,500.
Kinder Morgan folks are in second place, giving $1,077,600. Richard and Nancy Kinder gave Abbott $500,000 alone.
Why do Texas-based pipeline companies make such huge donations? Because Texas is a very special place when it comes to pipeline regulation.
Federal law governs pipelines that cross state lines, but state laws apply to the others. Most states mirror federal law and require pipelines to behave like a toll road, only allowed to charge for the volume of natural gas that passes through them.
Texas uniquely allows pipeline companies to own what’s inside the pipe, giving them monopoly powers. For decades, well owners have complained that pipelines require them to sell their gas at secret, low prices, while power plant operators complain pipelines demand secret, high prices when the gas reaches them.
Texas officials could take away the right to own the gas or insist on a transparent gas market where prices are public. But if Texas took those steps, Texas pipeline company profits would plummet. They make billions annually by secretly trading and moving gas around to maximize profits.
Spending $6.3 million on seven politicians over six years is small change to ensure profits they can’t get anywhere else.
The CirclesX and Kansas lawsuits, and the Oklahoma investigation, allege these companies took their market manipulation too far ahead of Winter Storm Uri in 2021. Not enough gas reached power plants when the temperatures dropped, and hundreds of people died due to the blackouts. But these companies made $11 billion in excess profits in a week.
Campaign donations are also about the future, explaining why no statewide elected Republican acknowledges climate change or the need to cut carbon emissions. The donations also explain why Patrick tried to spend $18 billion in taxpayer money on new natural gas power plants while hobbling renewable energy sources.
The pipeline companies’ political power also explains why the Abbott-controlled board ERCOT, the electric grid manager, is considering banning battery storage facilities from supplying emergency backup power. Lobbyists want to ensure Texas uses gas for decades to come.
Texas is indeed open for business, and our elected officials are happy to grant favorable terms for donors ready to pony up.