In Texas, Solar & Wind Energy Kept the AC on This Summer
How about this fall and winter?
Texas lawmakers say changes should provide protection for our Power Grid this winter, but other critical changes will be harder to execute.
A hearing this week in the State House Energy and State Affairs committees began with an optimistic report that the reliability reforms that were passed in Texas and implemented at the PUC & ERCOT are working. The state continues to switch from the old extra-electricity-when-needed (crisis-based) structure to a reliability-based model that focuses on keeping the lights, heat, and AC running.
Unfortunately, the changes to Texas Electrical Grid is going to hit everyone’s pocketbook.
Rules are in place to fine energy producers for non-compliance is up to $1,000,000 per day.
Nonetheless, the costs for winterization, inflation, and higher energy prices thanks to Russia are driving up delivery charges by some 50%. That doesn’t include the upcharges coming from REPs (Retail Electricity Providers) either!
It will be a burden on both commercial and residential electricity customers throughout Texas.
There is concern about additional changes to restructure how energy producers are compensated.
It could become a turf battle to determine if more power plants are built. But if the state doesn’t get companies to build new power plants, it doesn’t matter what is done in the legislature.
If additional generation capacity is not added to the grid, we’re going to be in great trouble.
This summer got too hot too early, which has forced farmers to harvest a month early, slashing yields to 80 bushels per acre from their typical production of 130 to 150 bushels. But many farmers in Texas these days, don’t fret about the weather as much as he used to. Many have 30-year leases with renewable energy companies that have erected large turbines on their land in exchange for a set fee plus a share of the electricity revenue they generate. In a typical year, the extra cash helps farmers pay down land and equipment loans and get a head start on the next crop. This year, lease payments and royalties will cover many of their drought-related losses.
One of the most active players in communities like this is Engie, a French energy company. It has a wind farm northeast of Waco that began producing electricity in December 2020 with 100 turbines across 30,000 acres and a substation connecting it to Texas’ grid. It has a production capacity of 300 megawatts per day, enough to power 150,000 homes. Engie has two more power projects under construction… another 300 megawatt project called Limestone Wind and a 250-megawatt Sun Valley Solar project. The company also plans to add 100 megawatts of battery storage at Sun Valley to allow it to hold on to electricity that can be released when needed. These will give Engie seven wind and four solar projects in Texas with a combined capacity to produce more than 2.2 gigawatts of electricity. The 200-ton towers are as tall as a football field and are increasingly common in Central Texas. The turbines surprise many who thought they were only in West Texas.
Inflation Reduction Act
The legislation provides billions of dollars in tax breaks and incentives to increase renewable energy and affiliated manufacturing designed to drive down carbon emissions. Surprisingly, Texas is already one of the leader in the country for renewables. Only eight states produce more total electricity than Texas does solely from renewable sources. And the industry within the state is growing rapidly too. Wind generation in May increased 32 percent from a year earlier and was 63 percent higher than in May 2018. Solar generation, while still a small part of Texas’ total energy production, was up 545% over 2018.
Kickbacks to Rural Republican Landowners
There’s a lot of money involved in these projects. Building new wind and solar projects on the prairie east of where Texas’ Wind industry bloomed puts Engie closer to established transmission lines that can supply metro areas like Houston and San Antonio. Engie spent $300 million to get Prairie Hill Wind up and running, and the Limestone plant is expected to cost about the same. That requires abundant available land and property owners. A land owner who owns 735 acres, is one of 78 who signed leases with Engie. Though many say they were “on the fence” about how the turbines fit into an agricultural environment (noise, aesthetics, damage to roads and infrastructure), they have been more than happy to receive their payouts.
Projects like these highlight the extent to which investment capital for renewable energy is flowing primarily into blue, Republican strongholds despite the political rhetoric from many on the right. Records show 41 of the 50 (82%) of U.S. congressional districts with the most money going toward renewable-energy projects are represented by Republicans. Even so, Republicans in Congress voted unanimously against the Inflation Reduction Act, even though their districts are poised to reap the expected benefits of increased spending on renewable-energy initiatives. In Texas, Republicans lead 8 of the 10 that are home to the lion’s share of wind and solar projects. Meanwhile, Democratic-leaning metropolitan areas that want to decarbonize their energy sources, have to payout to conservative strongholds and lobbyists that funnel money to blue counties.
Economic Benefits for Rural Communities & Schools
Funny enough all that puffery and bluster about the windmills ruining the view and adversely affecting their livestock is gone. Those blue, conservative communities are raking it in. Local schools in rural communities are getting more than their share of tax revenue while urban schools are dealing with overcrowded schools and budget shortfalls. And of course those communities are going to say that renewable power can’t sustain itself without government subsidies… that money is too easy.
