By: Wills Layton*

Background

In February of 2021, the state of Texas experienced a freeze that the electric system, consisting of electric sources such as wind and gas and more traditional oil and gas power plants, was not prepared to effectively combat.^[1] Nearly half of all Texans faced some type of disruption to water access, while 2.7 million households did not have power.^[2] Roads were coated in imperceptible ice that resulted in accidents on many major highways while animals also suffered, including the loss of over 3.8 million fish along the Gulf Coast.^[3] The freeze was a humanitarian disaster in which nearly 250 people lost their lives. Presumably, there would have been a bipartisan response to make sure no freeze could have the same impact in the future.^[4]

Politicians began to play the blame game almost instantly, with Democrats blaming the Republican-majority government, where both houses are governed by a Republican majority, for failing to prepare for a situation like a freeze. Meanwhile, Republicans blamed the move towards green energy as the culprit.^[5] Notable Texan politicians, including Texas Governor Greg Abbott, placed a majority of the blame on wind-related energy production and solar energy production and avoided blaming oil and gas-based energy.^[6] In reality, failures at natural gas plants were determined to be the largest culprit of the state-wide energy outages that plagued Texans.^[7] Additionally, the state’s independent and isolated electricity grid was unable to source energy from elsewhere, which contributed to the issue.^[8]

Brief Explanation of Texas Grid System

In the continental United States, there are three power grids – the Eastern Interconnection, the Western Interconnection, and the Texas power grid run by the Electric Reliability Council of Texas (ERCOT).^[9] This independence means that most of Texas is unable to draw from the Eastern Interconnection or Western Interconnection for either’s supply of energy, so in the event of a weather phenomenon such as the freeze, Texas could be left in the dark.^[10] Having an independent electric grid was based on a desire to avoid federal regulation, a common theme in Texas’ historically conservative led government.^[11] However, having an independent grid has allowed Texas to build power generation and transmission capacity quicker than other parts of the country and has allowed the state to experiment with deregulated energy markets.^[12]

Legislative Response

In response to the freeze, the Texas legislature aimed to support oil and gas power plants and development, simultaneously increasing obstacles for the development of renewable energy within the state.^[13] The legislature successfully passed two bills of note, Senate Bill 2627 and House Bill 1500, that are laden with incentives.^[14] Senate Bill 2627 creates a fund to incentivize the production of gas-fueled power plants by providing loans for the construction of plants, bonuses for completion of projects and connection to the main grid by 2029, and offering grants for modernizing and managing vegetation growth around electricity infrastructure in Texas outside of the main electricity market.^[15] H.B. 1500 changes the way electricity production companies can earn money in the Texas energy market, including setting a billion dollar cap on a financial tool requiring companies that sell power to pay extra money to companies that generate power and the creation of another financial tool that pays power generators that can produce power quickly.^[16] Meanwhile, other bills intended to weaken support for renewable energy, such as Senate Bill 624, which would have imposed increased permitting requirements for wind and solar power production, either died in the Senate or the House or were amended into H.B. 1500 as less-restrictive amendments impacting renewable energy.^[17]

H.B. 1500 was required to reauthorize the Public Utilities Commission (“PUC”), which regulates the state’s electric, telecommunication, and water and sewer utilities, and often includes compromised versions of other bills that did not have the support to pass on their own.^[18] The PUC is routinely reauthorized by the Texas legislature, with this reauthorization likely to last for the next dozen years.^[19] H.B. 1500 largely favors fossil-fuel powered generators and will likely lead to higher transmission costs for renewable energy sources.^[20] Transmission fees themselves have been increased by H.B. 1500, and starting in 2027 all renewable energy projects will be forced to secure expensive backup capacity through “firming” requirements contained in the bill.^[21] Other pieces of relevant legislation include Senate Bill 3, which contained a provision that would shift the financial burden of ancillary services that help ensure continuous generation to renewable energy providers.^[22]

The Texas legislature set out to cripple renewable energy production and capacity heading into the legislative session. However, environmental groups and other interested parties perceive the legislation that did pass as allowing renewable energy to dodge the proverbial bullet.^[23] Even though the toughest of restrictions on renewables did not make it through the legislative process, renewable energy was largely written out of many state incentive programs.^[24] It is widely believed that growing renewable energy reduces carbon emissions and air pollution, creates jobs, enhances the reliability and resilience of any power grid, increases affordability of energy, and increases energy independence.^[25] To actively go against the benefits that renewable energy provides to support natural gas and fossil fuels is a disservice to all who live within Texas.

Conclusion

In 2023 as Texas experienced record heat-levels and an increased demand and strain of the existing power system, solar and wind power helped stabilize the grid while producing nearly 26% of the total megawattage consumed.^[26] In fact, the strength of solar and wind power production likely helped Texans avoid inflated energy prices and possible outages.^[27] Texas renewable energy development has lowered the cost of electricity to Texans by $11 billion in 2022 and has led to the creation of over 2,500 jobs in the past five years.^[28] This has occurred at a time when automation is resulting in job loss for oil and gas extraction and has driven investment by companies looking to build renewable facilities in Texas.^[29] As of February of 2023, a majority of Texans support various methods of moving toward and supporting increased reliance on renewable energy.^[30] For example, 64% of Texans favor expanding U.S. reliance on solar power plants.^[31]

Despite the fact that renewable energy makes a positive impact on the lives of those it touches while also protecting the environment and wildlife, it is likely that the conservative-led government of Texas will continue the legislative efforts to boost fossil fuel and natural gas power generation at the cost of reducing support for renewable energy.^[32] The benefits of renewable energy are clear, yet the debate on renewables has become largely a political issue.^[33] While the leading position of Texas in the generation of renewable energy and the benefits that clean energy provides to the environment are undeniable, renewable energy has unfortunately become a scapegoat for a freeze where power outages were caused primarily by failures of oil and gas related power plants.^[34] Expect Texas to become a much less friendly environment for renewable energy investment and development should the legislature continue with its current goal of enhancing natural gas and fossil fuel production at the cost of green energy.

*Wills Layton is a Staff Member on the Journal of Law and Inequality.

^[1] Mandi Cai et al., How Texas’ power grid failed in 2021 — and who’s responsible for preventing a repeat, Texas Tribune (Feb. 15, 2022), https://www.texastribune.org/2022/02/15/texas-power-grid-winter-storm-2021/.

^[2] Neelam Bohra, Texas power outages: Nearly half the state experiencing water disruptions as power grid operator says it’s making progress, Texas Tribune (Feb. 18, 2021), https://www.texastribune.org/2021/02/18/texas-winter-storm-power-outage-ercot/.

^[3] National Oceanic and Atmospheric Administration National Centers for Environmental Information, The Great Texas Freeze: February 11-20, 2021 (Feb. 24, 2023), https://www.ncei.noaa.gov/news/great-texas-freeze-february-2021#:~:text=Though%20power%20outages%20occurred%20throughout,were%20issued%20in%20many%20counties.

^[4] Patrick Svitek, Texas puts final estimate of winter storm death toll at 246, Texas Tribune (Jan. 2, 2022), https://www.texastribune.org/2022/01/02/texas-winter-storm-final-death-toll-246/#:~:text=The%20figure%20includes%20people%20who,old%2C%20according%20to%20the%20report.

^[5] Chris Cillizza, Who’s actually to blame for the Texas power disaster?, CNN Politics (Feb. 17, 2021), https://www.cnn.com/2021/02/17/politics/texas-power-grid/index.html.

^[6] Julia Jacobo, Republicans use Texas power outages to spread false claims about green energy, ABC News (Feb. 17, 2021), https://abcnews.go.com/Politics/republicans-texas-power-outages-spread-false-claims-green/story?id=75947664.

^[7] Jon Greenberg, Natural gas, not wind turbines, main driver of Texas power shortage, Politifact (Feb. 16, 2021), https://www.politifact.com/article/2021/feb/16/natural-gas-not-wind-turbines-main-driver-texas-po/.

^[8] Reuters, Fact check: The causes for Texas’ blackout go well beyond wind turbines, Reuters (Feb. 19, 2021), https://www.reuters.com/article/idUSKBN2AJ2DZ/.

^[9] Kate Galbraith, Texplainer: Why does Texas have its own power grid?, Texas Tribune (Feb. 8, 2011), https://www.texastribune.org/2011/02/08/texplainer-why-does-texas-have-its-own-power-grid/ (updated Feb. 15, 2021).

^[10] Clifford Krauss et al., How Texas’ Drive for Energy Independence Set It Up for Disaster, N.Y. Times (Feb. 21, 2021), https://www.nytimes.com/2021/02/21/us/texas-electricity-ercot-blackouts.html?auth=login-google1tap&login=google1tap (updated May 13, 2021).

^[11] Asher Price, Why is Texas the only state with its own power grid?, Austin American-Statesman (Feb. 16, 2021), https://www.statesman.com/story/news/2021/02/16/texas-power-grid-why-state-has-its-own-operated-ercot/6765007002/.

^[12] Suzanne Russo, Texas goes it alone on electric power. That’s actually a good thing, CNN Opinion (Feb. 24, 2021), https://www.cnn.com/2021/02/24/opinions/texas-electric-power-russo/index.html.

^[13] Emily Foxhall, Fossil fuels got a boost from lawmakers aiming to fix Texas’ grid, while renewable energy escaped stricter regulations, Texas Tribune (June 5, 2023), https://www.texastribune.org/2023/06/05/texas-bills-energy-natural-gas-fossil-fuel-renewables/.

^[14] Id.

^[15] S.B. 2627, 88th Leg. (Tex. 2023), https://capitol.texas.gov/tlodocs/88R/billtext/pdf/SB02627F.pdf#navpanes=0.

^[16] H.B. 1500, 88th Leg. (Tex. 2023), https://capitol.texas.gov/tlodocs/88R/billtext/pdf/HB01500F.pdf#navpanes=0.

^[17] Id.

^[18] Jef Rouner, Texas Senate Moves to Shut Down Renewable Energy Permanently, ReformAustin (May 26, 2023), https://www.reformaustin.org/texas-legislature/texas-senate-moves-to-shut-down-renewable-energy-permanently/.

^[19] Kyra Buckley, Texas lawmakers reauthorize the state’s utility regulator after last-minute hurdle, Houston Chronicle (May 30, 2023), https://www.houstonchronicle.com/business/energy/article/texas-puc-reauthorization-passes-electric-grid-18126128.php.

^[20] Concentric Staff Writer, Texas Passed Energy Reform Bill as Heat Wave Pounded State, Concentric Energy Advisors (July 6, 2023), https://ceadvisors.com/texas-passes-energy-reform-bill-as-heat-wave-pounded-state/.

^[21] Luke Metzger, Texas Legislature subsidizes gas power plants, avoids worst attacks on renewable energy, Environment Texas (May 30, 2023), https://environmentamerica.org/texas/media-center/texas-legislature-subsidizes-gas-power-plants-avoids-worst-attacks-on-renewable-energy/.

^[22] Mitchell Ferman, Despite natural gas failures during winter storm, Texas lawmakers target renewable energy in the aftermath, Texas Tribune (Apr. 19, 2021), https://www.texastribune.org/2021/04/19/texas-renewable-energy-oil-gas/

^[23]Jeff St. John, Clean energy dodges a bullet in the Texas legislature, Canary Media (May 31, 2023), https://www.canarymedia.com/articles/politics/clean-energy-dodges-a-bullet-in-the-texas-legislature.

^[24] Asher Price, The politics of renewable energy in Texas, Axios Austin (July 6, 2023), https://www.axios.com/local/austin/2023/07/06/renewable-energy-politics-texas.

^[25] U.S. Dep’t of Energy, Off. of Energy Efficiency & Renewable Energy, Renewable Energy, https://www.energy.gov/eere/renewable-energy.

^[26] Julia Jacobo, Solar, wind energy keeping Texas power grids running amid weeks long heat wave, ABC News (July 7, 2023), https://abcnews.go.com/US/solar-wind-green-energy-keeping-texas-power-grids-running/story?id=100796136#:~:text=The%20Lone%20Star%20State%20has,reached%20an%20all%2Dtime%20high.

^[27] Id.

^[28] Russell Gold, The Texas GOP’s War on Renewable Energy, Texas Monthly (June 2023), https://www.texasmonthly.com/news-politics/texas-republican-war-on-renewable-energy/.

^[29] Id.

^[30] Patricia Ortiz, Majority of Texans support a shift to renewable energy, according to UH Hobby School study, Houston Public Media (Feb. 27, 2023), https://www.houstonpublicmedia.org/articles/news/energy-environment/2023/02/27/444811/majority-of-texans-support-a-shift-to-renewable-energy-according-to-uh-hobby-school-study-shows/ (“64% of Texans surveyed favor expanding U.S. reliance on solar power plants, 59% favor reliance on geothermal plants, and 57% favor reliance on wind turbine farms.”).

^[31] Id.

^[32] Mose Buchele, Texas state lawmakers unveil plan to curb renewable energy, subsidize natural gas, KUT News (Mar. 10, 2023), https://www.kut.org/energy-environment/2023-03-10/texas-state-lawmakers-unveil-plan-to-curb-renewable-energy-subsidize-natural-gas.

^[33] Justin Worland, Texas Could Be the World’s Clean Energy Capital—If It Wants to Be, Time (May 11, 2023), https://time.com/6278678/texas-clean-energy/.

^[34] Kevin Collier, Fact check: Renewable energy is not to blame for the Texas energy crisis, NBC News (Feb. 17, 2021), https://www.nbcnews.com/news/us-news/fact-check-renewable-energy-not-blame-texas-energy-crisis-n1258185.