The Texas Energy Experiment
A very important experiment is being conducted in Texas. It will demonstrate the relative merits of electricity production using fossil fuels versus solar and wind based upon cost, availability and reliability.
We know that Texas is a fossil fuel powerhouse accounting for about 42% of oil production and 27% of natural gas production in the U.S.
It is not as well known that Texas also leads the U.S. in electricity production using renewables. In the first half of 2025, Texas led the nation in renewable energy production, 181,000 GWh. California was second with 85,000 MWh.
Texas also leads in the installation of new solar and wind capacity and battery storage. Texas has the largest wind capacity of any state by a wide margin. In 2025, Texas is installing enough new solar capacity to exceed California’s utility-scale solar capacity. Texas also leads on the installation of utility-scale battery capacity needed to stabilize the electric grid by storing electricity when renewable electricity production exceeds demand and releasing electricity when demand exceeds supply.
How is this possible? There are several reasons:
- Texas has a state-wide electric grid managed by ERCOT (The Electric Reliability Council of Texas). Thanks to this grid, it is easy to connect the best areas for solar and wind farms to electricity customers throughout the state.
- Texas has a competitive retail electricity market. Producers have incentives to use the lowest cost sources for electricity and pass the lower costs on to customers. Low electricity prices result from the use of low-cost natural gas, not just renewables. The average electricity rate in Texas is 12 cents/kWh compared to the national average of 15 cents/kWh. The average rate in California is 30 cents/kWh.
- Texas favors new development and it is easier and quicker to get new energy projects approved and implemented than in most other states.
- The state leads in the addition of utility scale batteries to store electricity to smooth out supply and demand to stabilize the grid. ERCOT actively manages the grid in real time. Large electricity users can be required to adjust their electricity use when total demand is high. Additions to solar, wind and battery capacities has added to electricity reserves and strengthened the state’s ability to reduce or avoid blackouts and brownouts during times of peak demand.
Texas’ abundant and low-cost electricity will be a big help in developing the state’s economy. Low-cost electricity from renewables will support Texas’ production of green hydrogen, a fuel for the future.
California is second to Texas in renewable energy. However, California has among the highest electricity rates in the continental U.S. and imports up to 25% of its electricity. This is in spite of having excellent potential for solar and wind projects. California does not have a competitive electricity market. The Public Utilities Commission approves electricity rates requested by the state’s three large utilities. This high and rising cost of electricity in California works against the greater use of electricity from renewables for transportation, home heating and other uses being mandated by the state.
Conclusions.
The current administration is cancelling or discouraging renewable energy projects and their federal subsidies. However, solar and wind farms with battery backup are increasingly the lowest cost source of electricity in many locations.
Longer-term renewables future success in the U.S. will depend upon the cost and reliability of electricity from renewables compare to fossil fuels without subsidies and other government incentives. Based upon what is happening in Texas and many other locations, renewables could increasingly be the preferred alternative. For cost comparisons without subsidies, an adjustment is needed to eliminate the fossil fuel subsidy associated with the ability to discharge greenhouse gases and other pollutants into the atmosphere for free.
William Fletcher and Craig Smith’s third book on global warming, Irreversible: What Can We Do? will be released by Publish Authority in early 2026.
William Fletcher (retired) was senior vice president at Rockwell International. He served as an officer and engineer in the Navy working on the design and operation of nuclear-powered ships, and was an engineer involved with the design and construction of commercial nuclear power plants. Later, he specialized in industrial automation and international operations.
Craig B. Smith, Ph.D. (retired) is a former faculty member at UCLA. During his career he was responsible for planning large energy conservation programs. He is the former president and chairman of the international architect/engineering company DMJM+HN. He is the author of several books on energy efficiency and management.
