Why Renewable Energy Really Is Bigger in Texas

This article was written by our own Bill White, originally posted on Morning Consult on February 10, 2015.
I don’t know about everything, but clean energy is without question biggest in Texas.  At the end of 2014, the Lone Star State boasted 14,098 megawatts (MW) of wind generating capacity – more than twice as much as second-place California (5,917 MW), and more than one fifth of all wind power in the United States.[1]  Texas added 1,800 MW of wind in 2014 alone, more than the total installed wind capacity in 39 states.[2]  Now poised to go equally big with solar, the Electric Reliability Council of Texas (ERCOT) predicts the state will bring 6,000 MW of mostly utility-scale solar photovoltaic (PV) generation online over the next two years,[3] catapulting Texas to second place, trailing only California.


How did this happen?  It wasn’t because a progressive Governor advanced a set of pro-renewable, climate-friendly policies.  Texas is not California; the state’s the last liberal Governor, Anne Richards, left office twenty years ago.  Although polls suggest that overwhelming majorities of Texans accept climate science, there’s no evidence that climate policies are dictating voting patterns either.
The truth is surprisingly mundane: elected officials recognized that they were sitting on massive, high quality energy resources, and that they needed new infrastructure to develop them.  In 2005, the Texas legislature established and Governor Rick Perry signed into law the Renewable Energy Program, which directed the Public Utilities Commission (PUC) to identify Competitive Renewable Energy Zones (CREZ): geographic areas where wind generation facilities would be constructed.  In 2008, the PUC designated five CREZ for 18,500 MW of wind power and identified 3,600 circuit miles of new and upgraded transmission lines to deliver the wind energy to Texas consumers.^[4]  The CREZ lines were completed in 2013, and Texas will hit 21,200 MW of wind by the end of 2016 – surpassing the CREZ target by almost 3,000 MW.
Texas Renewable Energy is Better Than Free – It Actually Saves Money
The Texas CREZ lines cost $6.8 billion to build, which at first might sound like a big burden for ratepayers – until benefits are taken into account.  ERCOT estimates the CREZ lines and the renewable energy they enable will save ratepayers $2 billion a year and create more than $5 billion in economic development benefits for Texas – all while reducing electric sector carbon dioxide emissions by 16 percent. ^[5]  Bottom line: the CREZ transmission lines are paying for themselves rapidly, and will deliver huge net economic and environmental benefits for decades.
A common misconception about high-voltage transmission is that it is expensive and inefficient, when in fact just the opposite is true. At just 11%, transmission is the smallest part of the average consumer’s bill, far less than the 58% for generation and 31% for distribution.  Transmission investments like the Texas CREZ save money for ratepayers by trading relatively small investments in wires for much bigger savings in generation costs.  Utility-scale renewable generators are much cheaper per megawatt than smaller local installations.  Small scale wind turbines (100 kW or less) cost more than four times as much per unit of capacity as larger ones.^[6]  Utility-scale solar PV costs $1.88 per watt of installed capacity, about half of the $3.60 per watt for residential systems.^[7]  When high voltage transmission lines bring inexpensive and high quality renewables online, they pay for themselves rapidly by slashing generation costs.
Transmission Means Less Wind is Wasted
Transmission lines like the CREZ do much more for renewables than simply connecting the best resources; they get the most out of naturally variable wind and solar by making them available to greater numbers of diverse customers more of the time.  “Curtailment” occurs when grid operators shut down wind turbines to prevent the power they produce from dangerously overloading congested areas of the grid.  When this happens, zero-fuel-cost, zero-carbon wind power is lost or “spilled’ until the congestion is relieved.  The CREZ lines have slashed wind curtailment in Texas by more than 90%, from 17.1% of potential wind generation in 2009 (3,782 GWh) to just 1.2% in 2013 (363 GWh), and have effectively eliminated wind-related congestion between West Texas and other parts of the state.^[8]
The Nation – and the World – Could Learn a Lot from Texas
Bigger may not be better for everything, but Texas is proving that bigger is definitely better for renewable energy.  By the end of 2016, almost 28,000 MW of wind and solar generation will be operating in Texas – more than all but four countries other than the United States: China, Germany, India, and Spain.  Cutting global carbon emissions by 80 percent or more by 2050 – what an overwhelming majority of scientists agree is needed to avoid catastrophic climate change – is an enormous task that will require massive, rapid deployment of zero carbon energy for everyone, everywhere.  We have enough wind and solar to accomplish this many times over; what we need is a national-scale transmission infrastructure that will allow us to develop these resources at very large scales and then use them reliably and efficiently.  Texas is showing us that “going big” is our best path to a clean energy future.
Bill White is a Senior Advisor at Americans for a Clean Energy Grid and the President of Norton White Energy
 
[1] American Wind Energy Association, U.S. Wind Industry Fourth Quarter Market Report, January 28, 2015.
[2] Ibid.
[3] Trip Doggett, President & CEO, Electric Reliability Council of Texas, Presentation, 2015 WIRES Winter Meeting, Dallas, TX, January 22, 2015.
[4] CREZ Transmission Program Information Center, Public Utility Commission of Texas, 2014.
[5] “Advancing Clean Energy in Texas,” Public Citizen of Texas, 2014.
[6] 2013 Wind Technologies Market Report, Ryan Wiser and Mark Bollinger, Lawrence Berkeley National Laboratory, U.S. Department of Energy, August, 2014.
[7] Modeled turnkey pricing for installed solar photovoltaic systems, by sector, Q3, 2014.  U.S. Solar Market Insight: Q3, 2014, Solar Energy Industries Association, December, 2014.
[8] 2013 Wind Technologies Market Report, Ryan Wiser and Mark Bollinger, Lawrence Berkeley National Laboratory, U.S. Department of Energy, August, 2014.
Graphs:
Trip Doggett, President & CEO, Electric Reliability Council of Texas, Presentation, 2015 WIRES Winter Meeting, Dallas, TX, January 22, 2015.