The Roaring 20s for Clean Energy: Texas to Reach 50 Percent Renewable Energy by 2030

CleanTX, a Texas clean energy and clean tech business association, believes Texas will reach 50% renewable energy by 2030—without a renewable energy portfolio standard.  Melissa Kay Miller presented this reality at the virtual Renewable Energy Law Institute present by the University of Texas Law School.  I invited Melissa a leader of CleanTX and prior leader of the Texas Renewable Energy Industries Alliance (TREIA which merged with CleanTX in 2020).  As a member of the organizing committee of the Renewable Energy Law Insitute and the North Texas Chapter Chair of CleanTX and an environmental and renewable energy attorney, I thought it was important to discuss the realistic goal of 50 by 30 in Texas.

Melissa is as stated above is a CleanTX leader and Regional Manager of Central U.S. Development for Avangrid Renewables and lives in Austin, Texas.   Melissa stated that she does not think the Texas legislature will adopt a new renewable portfolio standard (RPS) and it does not look like we need it in Texas.  

“We kind of left that behind many years ago, the RPS hasn't been updated since I think 2005,” Miller said. “The market itself has really driven the growth. So, I think that RPS was absolutely essential at the outset of the industry here in Texas. You can see this trend across the United States, look at states that have RPS and you will see growth. … But the whole point of it was to get the industry off the ground and so that it could run on its own. Texas is very much open for business and of all the states that I develop in, that's one of the easiest from a standpoint of permitting.”

She said that Texas has the largest amount of wind energy of any state in the United States and is or is about to be the second most in solar energy only behind California.  In 2018, solar and wind made up a combined 20% of energy produced in Texas.  By the end of 2020, Texas electricity generation was at 25%.  That leaves nine years to double the current renewable energy generation to get to 50% of all electricity generation.

“There's a couple things that we know we can attribute to some of this growth in wind, specifically (the) production tax credit is stepping down, and will ultimately go away. And so, you're seeing a really big push right now, and have seen for the past couple of years, for wind to come online in order to realize that tax credit,” Miller said. “Solar, on the other hand, while you've only seen an increase from 1% to 2% from 2018 to 2020, we also know that there's 88 gigawatts of interconnection requests of solar in the queue in ERCOT as of the generation interconnection report at the end of December 2020. That's a lot of solar.”

While all of that solar generation will not be built, it does show that Texas is a focus of not only US solar investment but global solar investment.

Because of the ease of permitting and construction in Texas, the state has half of all corporate power purchase agreements (PPAs).  The abundance of clean energy has become an economic development tool in Texas.  It helps draws corporate relocations to the state.

A recently announced large 1300 MW solar project in Texas included numerous major corporations who have entered PPAs to purchase this clean energy.  The news article on this project indicate that AT&T is buying 500 MWs from the project, Honda 200 MWs, McDonald’s 160 MWs, Google 100 MWs,  and The Home Depot 50 MWs. Several cities and municipal utilities also entered PPAs to take power from this solar project.

When I taught Climate Change Law for four years, I discussed with my students how markets will bring renewable energy to greater and greater levels because of decreasing pricing. I taught them about the electric grid and power markets, and the technology of wind and solar energy.  As other states promoted and required renewable energy and energy storage for their states, they would drive down prices for these technologies and then they would grow in Texas based on superior technology, lower prices than polluting technologies, and be driven by private capital investment.  This is what has happened in Texas.

An enterprise I worked to form is investing in behind-the-meter solar projects for oil and gas production and pipeline operations. These companies are trying to meet their environmental, social, and governance or ESG goals to meet investor expectations. It may seem like strange bedfellow for oil and gas companies to be buying solar energy from our group, but it is the reality of ESG and climate action even for oil and gas companies.

Texas has numerous oil and gas private equity funds that have invested in oil and gas drilling and production companies, pipeline companies, service companies, and related businesses.  Today almost all of them are investing in “energy transition” or renewables, energy storage, hydrogen, and related clean energy or clean technology. One private equity fund has about $900 million to invest in energy transition businesses. 

The available capital from Texas funds, east and west coast funds, European investors, and investors from Asia is massive.  

For those of us in Texas looking to build out the renewable energy, energy storage, electric vehicle charging, hydrogen, and other clean energy and clean technology in Texas, we are at the beginning of the Roaring 20’s in clean technology.  Come join us and let’s build the clean energy economy of the future right here in Texas.