I hate that ERCOT gets the heat for rolling blackouts and outages. They're just the grid operator, running the grid according to the rules of the Public Utility Commission, which is appointed by the governor.

Ultimately they were given a nigh impossible task of keeping the grid up without making really deep cuts. There is plenty wrong with the Texas grid, and the PUC didn't force the implementation of better winterization and grid control. But given the rules and levers they were given, ERCOT followed their mandate and keeping us out of grid black start territory. Scapegoating them is a dodge that lets Abbot and his appointees off the hook.

The "fire" is largely a heat problem. The battery is typically already short-circuited internally, which causes it to heat up. This results in boiling and vaporizing internal electrolyte, which catches fire in air. Dunking it in water primarily cools the battery to stop this process. It also short-circuits it to some extent, but the water absorbs the energy of that short circuit effectively.

Lithium-ion batteries contain a lot of energy for their size, but it's nothing like the energy available from household power circuits, which as you say, don't mix well with water.