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Irina Slav

Irina is a writer for Oilprice.com with over a decade of experience writing on the oil and gas industry.

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The Lone Star State Looks To Become A Leader In Renewables

Texas is not the first state that one thinks of when someone mentions renewable energy. That would most probably be California. Yet Texas is already the biggest producer of electricity from wind farms in the country and is now on track to become the biggest U.S. producer of solar power, too. A private company, Invenergy, is building a 1.31-GW solar farm in Texas that is going to be the biggest in the United States, capable of producing enough energy to power 300,000 households when completed, which is scheduled for 2023.

According to a Wall Street Journal report on the project and wider industry trends, it was only a matter of time before Texas became a leader in solar power, as well as wind power. It has the perfect conditions, and with solar costs falling, chances are more solar farms will pop up across the Lone Star State.

They will add to 30.9 GW in installed wind power generation capacity distributed among 161 wind farms. Last year, this capacity provided 17.5 percent of Texas's electricity, powering the equivalent of 7,745,800 households, according to the American Wind Energy Association. During that same year, wind power generation in Texas helped avoid 49 million metric tons of carbon dioxide.

Solar energy, on the other hand, accounted for just 2 percent of electricity generation capacity in Texas last year, at up to 2.281 GW, according to the Electric Reliability Council of Texas. Also according to ERCOT, Texas was going to have 12.5 GW of solar capacity installed by 2029. That was five years ago. Now, the regulator expects the state's solar generation capacity to exceed 12.5 GW as soon as 2021, according to the Wall Street Journal. By 2023, there will be 38 GW of wind capacity and 21 GW of solar capacity in the state, according to ERCOT.

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This is all good news, not just for environmentalists and wind and solar companies. It is also good news for the oil industry, which has been bleeding jobs for months now because of the pandemic that caused the biggest oil demand slump in the industry's history. During the last oil price crisis five years ago, many of the laid-off oilfield workers moved to wind or solar installation. Now we could see a repeat of that as wind and solar expand while oil—especially shale oil—struggles to stay afloat with prices still too low for most producers in Texas.

In fact, the projected growth in renewable energy in the Lone Star State could help avoid a talent shortage crisis in the oil and gas industry. There have been warning voices about this looming crisis from before the pandemic: as older employees retire and fewer young people choose an education and career in oil and gas, there is a gap opening up that needs filling. But if the industry does not need to expand its workforce so much, what with oil demand forecasts anything but optimistic, the gap may close on its own.

With all that said, solar and wind proliferation in Texas, especially solar, is not without its problems. Landowners, for one, are worried that solar farms lower property values, and they appear to have good reason to worry.

The Houston Chronicles recently cited a study from the University of Rhode Island, which found solar installations close to otherwise attractive land put off some buyers because, despite their utility, they were visually unappealing. The report noted that since solar farms most commonly lie on farmland or in forested areas, they do become something of an eyesore in these surroundings.

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"People move for the rural character like the farms and forested lands so when a solar development comes in, it just changes the character of the development," the Chronicle quoted the author of the study as saying. The property price decline within a mile of solar installations was $6,000 according to the study—quite a substantial sum for most households.

Naturally, the Solar Energy Industries Association disagrees, calling such studies misinformation and citing the decorations of solar farms that, according to the association, make them look like greenhouses or single-story houses, according to the Chronicle report.

So, could the oil state become the wind and solar state? In the most direct way, it has already become the wind and solar state. It is also the biggest producer of electricity among all states and one of the biggest exporters. Interestingly enough, the state that has a reputation as the greenest of them all—California—is the biggest electricity importer among the states.

California has the most installed solar capacity in the United States, and yet it appears this is not enough to not just be self-sufficient in electricity but keep the lights—and the AC—on during the peak of summer, which is what happened to California this year, once again raising the question of just how reliable renewable power is in the absence of durable storage or other sources of energy such as gas, which is the case with Texas. It might not wear the crown for the greenest state but may soon beat California as the state with the most green energy capacity.

By Irina Slav for Oilprice.com

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