When our plane touched down in Dallas, we were greeted by a runway covered in ice and snow.
There wasn't a salt truck or snowplow in sight, and quite frankly, the entire airport looked deserted.
It took it us about fifteen minutes to actually pull up to the gate, where flight attendants warned us that some flights were being canceled due to the weather.
Three hours later and with a fresh shower of blue de-icing fluid, we were finally en route to our final destination in Palm Springs. We were the last flight out.
While some folks were bitching and moaning about the inconvenience, the truth is, Dallas is not prepared for snow and ice. Nor should it be. After all, the average winter temperature in Dallas is between 40 and 50 degrees Fahrenheit, and snow is very uncommon.
This year, however, uncommon weather conditions have been the norm — particularly in the south, where states of emergency have been issued.
As a result of arctic blasts ripping through the nation, power outages have been climbing. In fact, even in states where winter weather is not uncommon, energy shortages have caused utilities to ask customers to voluntarily curb usage. And, of course, natural gas prices soared.
In some parts of New England, the price of natural gas actually climbed to more than $100 per thousand cubic feet. This was the result of a combination of increased demand and a constrained supply of natural gas.
Yes, you read that correctly.
While we continuously rant about dirt-cheap natural gas and a supply bounty that'll last us a century, we've actually been seeing very tight natural gas supplies during these extreme weather conditions.
A Silver Lining
It's pretty simple.
Yes, we still have a wealth of natural gas. But with so many states reliant upon natural gas now — particularly with older coal-fired power plants being put out of commission — infrastructure is lacking. The bottom line is that states looking to take advantage of cheap natural gas still need a way to get more of it.
Of course, such a crisis offers a pretty substantial opportunity for infrastructure plays. And we've certainly been taking advantage of these since 2013. But this kind of infrastructure can't be built like shopping malls. These are long, regulatory-heavy processes that take time.
The silver lining, however, is that this offers a nice boost of confidence for renewables.
In fact, last month, when the state of Texas delivered a new record for power usage due to insanely cold temperatures, it was wind power that helped the Lone Star State avoid power outages.
According to analyst Katie Valentine, cold weather and shutdowns of some power plants forced the Texas grid operator to begin implementing its emergency plan to meet demand. Valentine went on to write:
"...demand remained high, but increased output from West Texas wind farms enabled the state to avoid an emergency scenario. It wasn't the first time wind has helped Texas avoid power outages in extreme weather, either — in 2011, high wind outputs during peak demand helped the Texas grid weather 100-plus temperatures."
Interestingly, while Texas provides us with a wealth of oil and natural gas, it also boasts an enormous amount of installed wind capacity. The state actually ranks first for total megawatts installed.
More than seven percent of Texas' electricity comes from wind, and there are more wind-related jobs in the state than in any other state in the nation.
Believe it or not, there's even more installed wind power capacity in Texas than in the entire country of Canada.
Overall, global wind energy capacity has tripled over the past five years.
It's already at grid parity in many parts of the world, and continued declines in production costs will ensure that growth rates continue, particularly as natural gas prices inch north.
Sure, natural gas is still insanely cheap, but it won't be that way for long.
A wealth of new infrastructure will accelerate consumption, and more exports are virtually guaranteed at this point.
To a new way of life and a new generation of wealth...
@JeffSiegel on Twitter
Jeff is the managing editor of Energy and Capital and contributing analyst for the Energy Investor, an independent investment research service focusing primarily on stocks in the oil & gas, modern energy and infrastructure markets. He has been a featured guest on Fox, CNBC, and Bloomberg Asia, and is the author of the best-selling book, Investing in Renewable Energy: Making Money on Green Chip Stocks. For more on Jeff, go to his editor's page.
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