Preheat oven to 400°F. To make the biscuits, in a large bowl, whisk together the flour, baking powder, salt, sugar, and baking soda. Stir in the grated butter and add the buttermilk. Carefully stir with a rubber spatula until the mixture just barely comes together.

Transfer to a lightly floured work surface and pat out into a 1-inch thick square. Using a round 4-inch cutter, cut out the biscuits and place on a baking sheet lined with parchment paper, about 2-inches apart. Chill for 15 minutes. Brush with melted butter and bake until golden brown, about 20 to 25 minutes. Remove and let cool slightly.

Meanwhile make the gravy. Heat a large saucepan over moderate heat with the oil. Once hot add the chorizo and cook, breaking up, until crispy and cooked through, about 5 to 8 minutes. Sprinkle the flour over the top and cook for 30 seconds or so. Stir in the milk and cook over low until thickened. Season with a pinch of salt, black pepper and chili powder. Stir in the cheeses and cook until melted through.

To serve, split open the biscuits and top with gravy. Garnish with sliced scallions and serve with fried eggs and hot sauce. Enjoy!