How a Minnesota-native views the current cold snap in Dallas. It's probably not what you're expecting. But it does highlight the challenges of preparing for unexpected events...

Ain numerous parts.

I was born and raised in Minnesota. I went to college in Chicago. I endured 36” snowfalls and regularly went running 4+ miles in below zero temperatures to train for track season. I scoffed when a dusting of snow would shut down southern cities.

I now live in Dallas.

And what I’m seeing in the midst of this cold snap and storm is eye opening.

It’s not that southerners aren’t cut out for the snow – it’s that their infrastructure isn’t optimized for once every two-decades polar vortexes. It’s the same way Minnesotans are devastated with 110+ degree summer temperatures.

System aren’t generally built for extreme, three-sigma plus events. In a resource constrained world, societies (and individuals) have to make tradeoffs. You can’t solve for everything simultaneously.

I woke up this morning at 7am. Our power had been off since 2am. It was a bit chilly in our house, but manageable. We expected the power to come back on within a few hours.

It didn’t. I was working from home, balancing a dwindling power supply on my iPhone and my laptop.

As the day progressed, and temperatures remained in the low-teens, the temperature in our house began to drop below 50 degrees F. This Minnesota boy was in a beanie, long sleeve shirt, and a hooded sweatshirt. I was shivering on my calls.

We have three young kids (under 6). They played happily upstairs, but by the time nap time came around, they were bundled in our bed with a heavy duty comforter.

But 4pm, I told my wife that we were going to a friends house or a hotel. We didn’t trust the power to come back on. I wasn’t going to have my family spend the night in 32 degree temperatures with no light after 6pm.

Here’s where the tradeoffs kicked in: Texas homes aren’t built with the same insulative characteristics as those in the north. They don’t have the same insulated pipes. And when snow hits, there aren’t snowplows to clean the streets.

How shortsighted one might say! Yet, it makes sense. You can gold plate everything, but there is always a cost. What cash strapped municipality would logically spring for maintenance and storage of heavy equipment that may never be used?

Why would local building codes call for construction techniques used in then North? Why not make them hurricane proof too?

Today, most of Dallas had either consistent power or had the 45-50 minute “rolling” blackouts. An inconvenience, but at least the power would come back on to heat up your house.

But our pocket of the city was different. I have no idea why, but it was likely something structural with a transformer. With crews spread thin we were (and are) likely deprioritized.

In every Minnesota winter I survived, I never once faced a power outage in the sub-zero temperatures. The electricity load and infrastructure was built and funded for frequent realities. I was never displaced from my home.

If we had faced a power outage in Minnesota, we likely would have snuggled around our wood-burning fire place until it was resolved. And it would have gotten real old, real fast.

But those things just aren’t needed 99.99 percent of the time in Dallas. Wood burning fire places are generally found in upper end homes. Even gas ones are non-standard, and for looks more than anything. In an already hot housing market, most folks don’t need nor want them.

Anyway, we quickly packed the family up as the sun faded and the heat seeped out of our (relatively newly constructed home). We left the faucets dripping to preserve what little chance we had of not having our pipes burst.

Like every other Texan, I have become an unabashed expert in Texas Energy Markets over the past 24 hours.

One could blame ERCOT and the power companies. I’ve even heard some commentators say “they had at least 72 hours notice!” They should have done something!

But what, exactly? The decisions that led to the outages today and likely for the remainder of this week were years in the making.

Wind power makes up 20% of the Texas grid. Those development decisions were likely influenced by politics – and the fact that West Texas is actually a phenomenal place to have wind power.

The benefits of years of wind could make up for the very small chance all the turbines would freeze up in a once-in-a-generation cold snap. Until the snake eyes roll of the dice actually appear.

Add that to a grid that typically plans for short duration spikes of +40 degree differentials (i.e. 70 indoors with 110 outdoors), but in fact gets one of greater than 60 degrees for multiple days (i.e. 70 to 10), and you’ll start to see some big problems.

My biggest lesson from the past few days isn’t that there was malfeasance or that ERCOT failed where other systems would have succeeded. It’s that we are bad at planning for tail risk and Black Swans.

Because doing so has immense costs. We look like fools when we build an Arc for a Flood that never arrives. And Arc builders are voted out by scoffing, short-sighted voters.

A hyper-optimized society has little room for flexibility when the unexpected occurs. There is no slack built in because slack requires resources that could be better allocated to more pressing priorities.

And I get it – why should Hawaii pay to maintain snowplows, or Minneapolis require hurricane-resistant building codes? Yet my 4 decades of life have been defined by the things no one predicted.

The fall of Communism. The Stock market bubble of the late 1990s. 9/11. The Great Financial Crisis. Donald Trump. Bitcoin. Coronavirus. Catastophic cold in Dallas.

Optimize for what you can and expect the unexpected. It’s all we can do.

Oh, and give folks the benefit of the doubt in crisis. I’m from Minnesota and I don’t have winter boots for my 2 year old daughter. Why would I?

The icing on the cake is that one year ago I was at dinner with a good friend who happen to be a senior executive at a local power distributor. I asked him what kind of Black Swan planning they do.

He mentioned their in-depth scenario planning to head off catastrophe. I left the conversation impressed by their process.

And yet, they did not foresee what happened today. Not because they are not intelligent. But because predicting the future is hard. And dynamic systems have a way of surprising even the best of us.