Vol 6 No 4 Winter 2023

Socialist Politics and the Electricity Grid

In February 2021, Winter Storm Uri froze much of Texas’s electrical generation infrastructure, resulting in the grid operator imposing rolling blackouts on millions in freezing temperatures. The blackouts not only devastated home and water infrastructure; they also killed as many as seven hundred people. Many who survived were saddled with unthinkably high electricity bills, forcing the state to bail out customers. The costs were a product of simply leaving the market free to set prices. As one Texas Monthly article explained, “For the entirety of 2020, Texans paid $9.8 billion to keep the juice flowing. On February 16 alone, they spent roughly $10.3 billion.” Gas producers in particular reaped the gains, with one claiming the storm was “like hitting the jackpot.” One particularly egregious actor was “Griddy,” an electricity retailer sold to customers as a way to access cheaper electricity on the deregulated wholesale market. Yet electricity shortages created no mechanism to prevent skyrocketing prices, and some customers received a monthly bill as high as $17,000.

More recently, preexisting natural gas supply crunches were exacerbated by the Russian invasion of Ukraine in February 2022, and natural gas prices in Europe were “about 10 times more than … a year ago” in August 2022. This was bad news for electricity markets designed with a “marginal pricing” system that tends to price all electricity in line with natural-gas-based generators. In late 2020 in the UK, the wholesale electricity spot price had risen tenfold from November 2020 to September 2022. The energy crisis in Europe has also highlighted the importance of “energy security” to modern political governance. While many analyze these dynamics in geopolitical terms of state rivalry, they also have dire consequences for ordinary working-class people: factories shutting down and workers furloughed for lack of natural gas, a pervasive industrial input, and homes experiencing freezing temperatures in an attempt to avoid skyrocketing bills.

On top of this market chaos, it is also clear that solving the climate crisis hinges on the electricity sector. All pathways to decarbonization go through cleaning up electricity and “electrify[ing most] everything” else that currently doesn’t run on electricity. Underappreciated is that this strategy will require a massive expansion of electricity generation (one notable estimate from Princeton University suggests we will need to double or even quadruple generation over the next three decades). After decades of stagnant demand for electricity, this expansion would require a growth in generation capacity not seen since the 1970s.

All this points to a basic fact: electricity is poised to be a central site of political struggle in the twenty-first century. How should socialists approach this sector? We propose four core principles. First, electricity is a key life-sustaining service, and it should be produced and provisioned as a public good rather than a market commodity. There is no logical reason why we provision water as a subsidized public utility and not electricity. Moreover, the price volatility unleashed by market-based electricity provisioning should be an opportunity for socialists to fight for an alternative model. While the Elon Musks of the world hawk the benefits of “delinking” from the grid through the individual purchases of rooftop solar equipment and battery storage, we must fight for the expansion of electricity as universal public infrastructure. Second, as long as electricity is controlled by capital, the first goal will be subverted. Thus, campaigns for public or alternative ownership structures of electricity are crucial. Third, electricity is a complex material system of production, involving constant physical balancing of supply and demand, that is conducive to socialist planning. Consequently, it requires a deep materialist understanding of how it works and how it might be transformed. Fourth, it is the workers and unions in this sector who not only possess direct skills and knowledge of the third fact but who also have the most potential power to achieve the first two goals.

While these principles might sound intuitive to the reader, existing currents in the environmental left — much of which are highly influential among socialists — tend to undermine them. Together, they point toward the importance of centralized, large-scale reliable power generation like hydroelectric dams and nuclear power, as opposed to decentralized, small-scale, and intermittent forms of power like rooftop solar panels. Furthermore, because of their fixation on the urgency of the climate crisis, many activists today tend to propose unrealistic and rapid changes to the electricity system that are at odds with basic principles of maintaining reliability of the grid (a concern that itself has been presented as a form of climate denial). An ideological preference for renewable energy tends toward advocacy for more market provisioning and deregulation of electricity. Finally, because of their embeddedness in the professional class, particularly in academia and nongovernmental organizations, climate activists often show little connection to or interest in the unions and workers that are part of the electricity system itself. In fact, many take an explicitly dismissive attitude toward unions as part of a compromised Global North regime, “predicated fully on war and extraction of wealth from the Global South.” Climate activists like to comfort themselves with the idea that a winning climate movement will emerge mostly from workers more culturally similar to themselves: “low-carbon” workers like teachers and nurses. Yet insofar as these “care” workers will be a central plank in any climate coalition, to act as if we can simply disregard the very workers at the heart of the industrial system we seek to transform is strategically bankrupt.

In the current moment, we see electricity politics reflecting a split within the capitalist class. On the one side, the historically embedded investor-owned utilities seek to maintain their control over the existing grid, claiming a commitment to reliability above all. On the other side are industrial consumers of electricity — most prominently, the new tech capitalists like Google and Amazon — who seek flexible electricity supply contracts not with the utilities but with independent power producers (including solar and wind generators) whose existence is a product of the deregulation and restructuring of electricity since the 1970s. This alliance between renewable energy capital and big tech consumers emphasizes their green credentials in the face of catastrophic climate change. We argue that the Left itself is divided in the same way, with traditional labor unions aligning with the utilities while environmentalists and ecosocialists align with renewable energy producers, Google, and increased marketization of electricity. We contend that the former coalition will bear more fruit for a socialist electricity politics based on public planning, the centrality of labor unions, and the transformations of production required to respond to climate change.

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