Texas’ Monthly Solar Generation Trounces Coal Despite Massive Support for Fossil Fuels

Despite moves from public officials to protect fossil-fuel interests in Texas, interest in renewable energy continues to grow. The state recently established itself as a possible market for new solar power technology, a surprise since the oil and gas industry has a firm grip on the state’s economy.

In a 2023 recap, Glenn Hegar, Texas’ state comptroller, revealed that the state ranked second in lignite coal production in the United States as of 2022, with North Dakota being the first. Data from the U.S. Energy Information Agency also shows that Texas is the largest consumer of coal in the country, with most of the coal used being obtained from in-state mines. The agency explained that on a tonnage basis, the state’s lignite made up about one-third of total coal consumption in Texas. The agency then noted that very limited quantities of the lignite was exported to other states while most of it was used to generate electricity in power plants in Texas.

As of last year, the state had 15 coal power plants, with a combined capacity of roughly 20,000 megawatts. The plants accounted for roughly 11% of the electricity grid managed by the state’s Electric Reliability Council.

Latest figures from March 2024 now show that power generation from solar topped output of coal for the first time, supplying 3.2 million megawatt-hours to the grid. This is slightly higher than the 2.9 megawatt-hours supplied by coal for the grid. Additionally, the figures show that the market share occupied by coal dropped below 10% for the first time ever, continuing a long-term slide that started about 10 years ago. In the same period, solar’s market share rose by roughly 10%.

When one considers that solar was barely noticeable a couple of years ago, these latest figures become even more impressive. In 2017, solar made up less than 1% of total electricity demand. It is important to note, however, that solar can’t take all the credit for casting coal aside. Years before it entered the scene, natural gas had been competing to dominate the ERCOT grid instead of coal.

In other news, voters in Texas passed Proposition 7 in November 2023. This ballot initiative establishes a new fund to support the construction of more thermal power plants.  A majority of these funds has been earmarked for natural-gas power plants, with one provision stipulating that they cannot be allocated for battery-storage applications.

This is bad news for developers of renewable energy that rely on energy storage to reduce any issues in the availability of solar and wind.

With the kind of support that coal energy enjoys in jurisdictions such as Texas, companies such as Arch Resources Inc. (NYSE: ARCH) can be sure the end of coal will not come as swiftly as climate-change activists would want it to happen.

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