Clean energy is rapidly increasing on the Texas power grid, but regulators in the Lone Star state are now considering a plan that could boost fossil fuels.
The trio of zero greenhouse gas emissions — wind, solar and nuclear power — will provide more than 40 percent of the state’s electricity by 2022. It was a year when several cities in Texas had their warmest summers on recordthe driving electricity demand to the highest level ever when fans and air conditioners are turned on. Winter also proved stressful, with freezing temperatures last month driving up winter electricity spikes record highsscary prevent outages.
Texas was not alone. Over the past year, states like California have experienced blackouts as scorching temperatures drove up electricity use, while the ongoing drought in the western US tightened power supplies. Renewable energy is growing across the country, but so are threats to the power grid. Utility regulators are trying to figure out ways to cope, and Texas — the largest producer of energy in the U.S. — could provide crucial lessons.
However, Texas has some unique factors at play.
Texas leads the US in oil and natural gas production, but it is also number one in the wind current. Solar energy production in the state has nearly tripled in the past three years. Part of the reason is that Texas is particularly well suited to renewable energy on its grid. Wind turbines and solar panels in Texas have a high degree of “complementarity,” so deficits in one source are often offset by increases in another, smoothing power production and reducing the need for other generators. That has the integration of intermittent energy sources on the grid.
Meanwhile, since 2006, coal has lost more than half its share in Texas. For a long time and in much of the country, the story went that cheap natural gas from hydraulic fracturing was the cost of coal on the power grid. Coal also faced stricter environmental regulations, such as stricter ones limits on mercuryforcing coal plants to upgrade their equipment and increasing electricity production costs.
“The combination of the environmental regulations that are becoming stricter and the low price [of competitors] means coal is struggling to compete in the market,” said Michael Webbera professor of energy resources at the University of Texas at Austin.
But in Texas, natural gas’s share of the electricity mix was maintained about 40 percent for more than a decade. On the other hand, renewable energy has boomed as coal withered. Wind alone started beating coal in 2019 and is now the second largest source of electricity behind natural gas in the state.
Clean energy sources (wind, nuclear energy, solar) generated about 40% of the electricity @ERCOT_ISO in 2022, natural gas took the top spot again, stable at the 17-year average of 43%, and coal continued its decade-plus long decline. pic.twitter.com/X0Pv0oAN5X
— Joshua D. Rhodes (@joshdr83) January 17, 2023
A key factor is that the state has its own internal power grid, serving 26 million customers and meeting 90 percent of its electricity demand. It is administered by the non-profit Electric Reliability Council of Texas, or ERCOT. In the free-running energy market in Texas, the cheapest sources of electricity are becoming dominant, and wind and solar – with low construction costs, fast construction times and zero fuel costs – have emerged as winners.
Some Texans also go out of their way to purchase renewable electricity. Utilities such as Austin Energy offer customers the choice to pay extra to buy wind and solar power, and thousands have done so. “As a public utility, Austin Energy’s decades-long shift to renewable energy reflects the priorities of our customers and our city,” Matt Mitchell, a spokesman for Austin Energy, said in an email.
Since there are few grid connections to other states, Texas’s power grid avoids federal oversight, giving Texans more flexibility in setting their own rules. The downside is that Texas has a hard time getting extra juice when its own alternators lose steam.
That was abundantly clear in February 2021, when Winter Storm Uri cooled huge swaths of the United States. In Texas, more than 4 million customers were without power as temperatures dropped below those in Alaska. The official death toll was 246although some estimates place the number higher.
The blackouts were largely the result of frozen coal piles and natural gas pipelines, which cut off fuel supplies to power plants. Nevertheless, Republicans in Texas, including Governor Greg Abbott, blamed wind power as the cause of the crisis.
Some lawmakers are now working to tip the balance toward fossil fuels. “There are several political figures who are trying to boost gas plants or deny, ban or inhibit renewables,” Webber said.
Last year, the Texas legislature passed a law that would prohibit the state’s pension and investment funds from doing business with companies that “boycott” fossil fuels.
Lieutenant Governor Dan Patrick of Texas said one of his own legislative priorities for this year is to get more support for natural gas-fired generation. “We need to level the playing field so that we can attract investments in natural gas plants,” Patrick said at a press conference last November. “We can’t leave here next spring unless we have a plan for more natural gas power.”
He can get his way. With recent winter storms in mind, the Texas Public Utility Commission, which regulates electricity, is now considering proposals to reform the electricity market to increase reliability. This month, the committee approved a proposal that is ostensibly technology neutral, but may ultimately favor natural gas plants.
While wind and solar power are on the rise, they’re intermittent, and regulators want to make sure there’s enough shippable energy like natural gas to ramp up on still, cloudy days. The new proposal would create a credit scheme that would encourage more of these shippable plants to come online and extend a lifeline to some existing generators that are struggling to compete. But it would also increase the cost of electricity production.
Environmental groups such as the Sierra Club noted that the proposal leaves the door open for other tactics to balance electricity supply and demand, such as energy storage, increasing energy efficiency and demand response.
While regulators in Texas work out the details of these reforms, the rest of the country should pay attention. As climate change pushes average temperatures upward, the U.S. power grid is under more stress than ever, not only from rising demand and struggling supply, but also from extreme weather events damaging infrastructure. Clean energy sources may be more abundant than ever, but so are threats to the power grid.