It is evident that Texas has a love affair with renewable energy. Experts warn that even after another record year of clean energy in Texas, a market restructuring, fueled by political rhetoric coming from state leaders could hinder future deployment.
According to newly released market data, almost all of the new generation capacity added to Texas’ grid by 2021 was from wind and solar. S&P Global Market Intelligence notes that power plant operators added 8,139 megawatts of new generating capacity to the ERCOT market last year — 42% came from wind and 40% from solar. Natural gas-fired expansions made up 13%.
Nationally, wind & solar made up a smaller percentage of new generating capacity — 41% & 36% respectively — of the 27,959MW of capacity.
Jeff Clark, president, and CEO of Texas-based Advanced Power Alliance said that Texas continues its benefit from long-term price certainty and corporate demand for clean energy. He stated that there are opportunities for more growth through broad electrification, which includes the transportation sector.
Clark said that “These are exciting times in clean power sector, thanks continued improvements in technology, economics,” and also advocated for the replacement coal-fired generation capacity with cleaner natural gas. “The additions of energy storage projects and the enormous pipeline of projects ahead will enable greater reliable and resilient integrations of renewables, accelerating these trends.”
California leads the way in new energy storage capacity expansions. Texas is not far behind.
ERCOT is growing in the energy storage market. California’s 230 MW McCoy Battery Storage Project was the largest battery energy storage system, but Texas has the next two largest systems: the 102MW Gambit Battery Storage Park and the 100 MW North Fork Battery Storage Project.
Energy storage, when combined with rapid deployment of renewables can provide resilient, reliable electricity to residential, commercial and industrial customers in Texas. This is where an extreme winter storm almost caused the complete collapse of the electric grid in February 2021. In 2021, California’s ISO region seized 55% of the new energy storage capacity, while Texas had 38%.
Dr. Joshua Rhodes is a research associate at Texas A&M University and a founding partner of the energy consultancy IdeaSmiths. He believes that additional incentives for energy storage would allow for greater deployment of Texas’ renewable energy resources.
“The interconnection queue at ERCOT is full. It’s comically overflowing,” Rhodes stated. Renewable Energy World. “I believe we’ll see a lot of storage connected to the grid.
“Before, we could only get more renewables on our system by building more transmission. This is no longer true with storage.
Can Texas maintain its renewables momentum?
Experts believe that the uncertainty surrounding the Texas Public Utilities Commission’s market redesign has slowed the deployment renewable energy resources.
In July, Abbott directed the PUC to “allocate reliability costs to generation resources that cannot guarantee their own availability, such as wind or solar power” and to “streamline incentives within the ERCOT market to foster the development and maintenance of adequate and reliable sources of power, like natural gas, coal, and nuclear power.”
Doug Lewin is a Texas-based energy specialist who stated that adding ancillary services costs to renewables could be a “major shift” that could impact future deployments in Texas.
Lewin stated that “it will really stifle the development.” “There is not much interest in building new thermal power plants. It could put Texas in a bad spot. We’ve made it difficult for renewables so much that they’re not available to us. The market isn’t competitive enough to allow thermals in.
“There is a real danger there.”