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Texas and California take different approach to the health of the grid.

The health of the electrical grid in North America is a topic of concern that is become more urgent every year.  Solar and wind provide electricity of a lower price than coal or natu and do so without CO2 or particulate emissions. Renewable growth which should, in theory, reduce the price of electricity while providing clean energy.  However, they have actually increased the cost to most consumers and added a level of complexity that has made our utilities less reliable.  But that has not, and should not, slow the expansion of renewable sources.

The grid situation is dynamic and the need for more energy is not ending soon. EV’s are increasing demand, but so are data centers and the push to go with heat pumps and electric appliances. Couple that with the proliferation of low cost, intermittent power sources and decommissioning of coal plants and we have challenges. 

We need peaker power plants, mostly natural gas, and battery energy storage systems (BESS) to compliment the renewables. We certainly want upgrades to our transmission and distribution network to get the power from where it is generated to where is it required. Throw in microgrids and virtual power plants and it can really get confusing. 

Texas and California are two localities where we see contradictions of the stereotypes around power generation and management of the grid.

Texas is oil country.  You would expect a grid powered by coal, natural gas and oil.  But they are the leader in new solar and wind deployments in the US.  For the first time ever, solar power generation surpassed coal for Texas this past March. This is a remarkable achievement. 

Natural Gas is still king for ERCOT (the Texas regional transmission organization) with 42% of the electricity production last year. That is close to the long-term average for the fuel. What one would not expect is that wind is a strong second source, with 29%, and growing. With solar continuing to rise the victim for renewable growth has been coal. Let’s put this in perspective; Coal sourced electricity production was 40% in 2010. It was down to 11% last year. 

Texas is also leading in battery storage as well.  Batteries (BESS) store energy for deployment when needed.  An example is when solar power slumps in the late afternoon just as demand rises as people get home from work to cook dinner and do laundry.  In 2024, Texas will add enough capacity to double its battery storage and all the growth is market driven. 

“When you suddenly get 10 gigawatts of storage on a system, there’s really no market in the world other than California that’s anywhere close to that… and Texas was a situation with no market mandates. This was pure wild west investment based on the growing need for fast-ramping and flexible generation in relatively short but predictable bursts to be the glue for the grid.”  (source)

The growth in battery capacity will not solve long term storage to prevent another winter storm collapse like in 2021. However, this will balance the grid and compliment low-cost renewables to stabilize prices and build resiliency. 

Yes, we have a long way to go. But it is undeniable; the Texas grid is getting cleaner by the day. It's remarkable that this is occurring in oil country.

Texas is trending to de-thrown California as the top renewable state because of their business-friendly environment and easier zoning and permitting process in a deregulated market.  Even though California has a huge appetite for clean energy, their environmental and regulatory restrictions provide strong headwinds.

California changed their rule on utilities buying excess solar generated from residential rooftops at retail prices which include generation, distribution and transmission costs.  Although it’s counterintuitive, adding rooftop solar that is fed to the grid actually raises the cost of electricity to those without rooftop solar.  California residents still have the ability to earn credits for excess solar. The price paid to the homeowner simply fell to wholesale rates. That is a reasonable approach but it will reduce the additional rooftop solar installations. 

I advocate for a #ANDnotOR approach.  There is no single solution to enable us build a robust grid.


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