Texas Border Business
While it is widely known that Texas is a key producer of oil and natural gas, many are unaware that the state is also a leader in green energy. The installed capacity in renewables has been growing at a rapid pace, and, barring artificial obstacles, this pattern will likely continue.
Globally, renewable capacity grew from less than 1.6 million megawatts (MW) in 2013 to nearly 3.4 million in 2022. In the United States, wind and utility-scale solar power expanded by about 328% over that period. In Texas, wind capacity more than tripled, and solar capacity went from almost none to more than 8,820 MW.
Texas ranks first among US states for installed wind capacity by a wide margin. In 2021, the state’s capacity was 35,969 MW, more than all but four countries (China, the US, Germany, and India). Texas is also adding more than any other state, with an increase of 3,343 MW in 2021. Wind supplies about one-fifth of the state’s utility-scale generation, a substantial share though well below the almost 50% provided by natural gas.
Moreover, Texas has 8,820 MW of utility-scale solar capacity, second only to California with 13,579 MW. However, Texas is increasing solar facilities much faster of late, and the differential will narrow or disappear if that momentum persists. When small-scale facilities are included, Texas solar capacity nearly doubled in 2021, rising from 5,987 to 10,329 MW and accounting for about 3% of the state’s total electricity generation.
These gains in green power have reduced emissions significantly, which is a critical benefit. They also frequently help to keep prices attractive. On a breezy and mild spring day, wholesale electricity prices can drop to extremely low levels.
One potential downside of this expansion is the intermittent nature of wind and sunshine, which can cause problems in assuring reliable electricity supplies under adverse weather conditions. Although batteries are being installed at a notable pace and the related technology is improving, there are not enough of them to bridge the gaps (nor will there likely be for quite some time). Consequently, we must also support the responsible growth of base capacity from other fuels (primarily natural gas) – an “all of the above” strategy that recognizes the realities of a dynamic and growing population and economy with a solid footing in many power-intensive sectors.
In addition to its widely recognized energy resources resting deep under the soil, Texas has abundant wind and vast expanses of vacant lands where the sun shines with great regularity. Strides are also being made in hydrogen and other emerging energy sources. We will need all of them to meet our long-term needs, and policymakers need to be aware of this incontrovertible fact. Stay safe!
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Dr. M. Ray Perryman is President and Chief Executive Officer of The Perryman Group (www.perrymangroup.com), which has served the needs of over 3,000 clients over the past four decades.
