However, despite its energy leadership, the Texas electricity grid has been beset with issues in recent years. Between 2000 and 2023, Texas suffered the most weather-related power outages of any state, with 210, reports Climate Central. This includes a major failure in 2021 caused by winter storms that left over 4.5 million homes and businesses without power. At least 246 people died as a result.

Why are renewables being deployed at scale in a state rich in fossil fuels, and how are they impacting the strained grid?

Texas’ electricity grid 
Unlike the rest of the US, Texas operates its own power grid – the Texas Interconnection – separate from the Eastern and Western Interconnections. The electric power system is managed primarily by the Electric Reliability Council of Texas (ERCOT), which oversees electricity delivery for approximately 90% of the state’s population, or more than 27 million customers. This structure provides a high degree of autonomy, but is increasingly under criticism as widespread outages disproportionately impact Texans. The recently proposed ‘Connect the Grid Act’ could require the Texas electrical grid to increase connections to the Eastern and Western Interconnections, improving supply. However, it has yet to pass through Congress.

What’s more, ERCOT predicts Texas electricity demand will almost double by 2030 and reach around 150 GW, driven by population growth, increasing electrification, more extreme weather events, and the expansion of data centres, AI and cryptocurrency mining. Ensuring the reliable operation of the Texas grid is therefore extremely important for the US power sector as a whole. For instance, the Stargate Project, a new company which aims to invest $500bn over the next four years in building new AI infrastructure for OpenAI in the US, is beginning its buildout with a $100bn investment in Texas.

Geography and infrastructure
Texas’ abundance of open land and favourable wind and solar conditions, and rising electricity demand, make it an appealing place for renewable projects despite its traditional hydrocarbon industries. This has attracted leading renewable energy companies such as RWE and Engie to invest heavily; Enel, Iberdrola (as Avangrid) and EDPR are also active in the state.

For the past two decades, Texas has led the nation in wind energy (by installed MW, but not by share of electricity generated; that is Iowa, at 57%). By 2022, its wind turbines produced 40,556 MWh of electricity, over a quarter of all wind generation in the entire US. RWE’s Rosoe wind farm in central Texas has 627 turbines and a total installed capacity of 781.5 MW.

RWE spokesperson Patricia Kakridas, told New Energy World that RWE’s Forest Creek wind farm in West Texas was one of the first assets commissioned in the US, back in 2007. The unprecedented pace of Texas’ soaring electricity demand combined with its favourable wind and solar generating conditions make Texas a key market.

‘The electrification of industry, including oil and gas, alongside massive load growth from data centre operations and AI, and the reshoring of manufacturing… will require the deployment of all available energy resources to maintain reliability and keep costs down for consumers. Wind and solar are the fastest-to-market generation sources available in the next 3–5 years and will be needed to help meet the growing demand, along with battery storage and nuclear and natural gas,’ she said.

Besides renewable energy companies, Texas’ conditions have persuaded some traditional energy companies to diversify their generation sources. For instance, Duke Energy has been expanding its portfolio since the 2000s to include solar and wind farms. In 2016, it commenced operation of its 912 MW Los Vientos wind farm in Texas, the second-largest in the US after the Alta Wind Energy Center in California.

Texas’ population boom (swelling by about 9 million between 2000 and 2022) has driven up energy demand.

Solar has been on the rise in Texas. The state had just 72 MW of solar capacity installed in 2012; by 2023, capacity exceeded 16 GW. The Lone Star State saw a 35% year-on-year increase in solar output in 2023. Texas installed more solar capacity than any other state in both 2023 and 2024.

However, Texas’ geography can also work against it. Extremes of temperature, both hot and cold, are worsening annually due to climate change, causing the grid serious problems managing demand. Many people, including energy sector workers, blame ERCOT and power companies for not investing in their infrastructure to ensure it can manage both air conditioning spikes during summer heatwaves and colder winters that can freeze equipment, leaving Texans with no heating.

A representative from a major energy company pointed out that making these adjustments would be extremely costly, with consumers shouldering the debt through higher electricity bills – an unpopular solution.

It appears that the growing availability of solar generation backed up with battery storage capacity is helping offset these issues. Due to heat waves in 2023, ERCOT issued 11 requests for electricity conservation. In contrast, last year, Texas’ power system manager did not have to issue any requests. This coincided with record-breaking amounts of power being provided by solar and big utility-scale batteries, suggesting these solutions are strengthening the grid.

ERCOT predicts Texas electricity demand will almost double by 2030 and reach around 150 GW, driven by population growth, increasing electrification, more extreme weather events, and the expansion of data centres, AI and cryptocurrency mining.   

Legislation: help or hindrance?
Besides its favourable terrain and weather, Texas’ explosion in non-hydro renewable generation has also been stimulated by legislation. The state adopted the Renewable Portfolio Standard (RPS) in 1999, setting a rule called the Goal for Renewable Energy. Part of the RPS was a requirement for Texas to install 5 GW of new renewable energy capacity by 2015. It also set a target of 10 GW of renewable energy capacity by 2025 – a target that Texas accomplished in 2010.

However, the second term of President Donald Trump has threatened much of the green transition’s progress, and Texas’ legislation may start working against wind and solar projects. The Texas Senate recently voted in favour of Senate Bill 819, which adds restrictions on solar and wind power projects, requiring new permits, assessing fees, adding new regulatory requirements and placing new taxes on the projects. This new legislation ‘adds onerous requirements to new solar projects that would not apply to other energy sources except wind’, said the Solar Energy Industry Association (SEIA).

This could be disastrous for the state’s already strained grid. It could change how favourably companies like RWE view Texas for new projects. At present, the German energy company has two solar projects under construction in Texas, totalling 400 MW capacity and a diverse mix of onshore wind, solar and battery storage projects under construction totalling about 1.6 GW power capacity.

Kakridas pointed to the state’s ‘robust energy market and technology-agnostic approach to electricity generation, which invites competition’ as the motivation for RWE’s investment there. If this changes, RWE and other renewable energy companies might turn away from Texas, potentially disastrous for the grid attempting to meet surging electricity demand.

What is clear is that solar is lucrative for the state. A 2025 SEIA report found that existing and expected utility-scale solar, wind and battery storage projects will contribute over $20bn in total tax revenue. In addition, these sectors will pay Texas landowners $29.5bn over the projects’ lifetimes. More than three-quarters of Texas counties are anticipated to receive tax revenues from either wind, solar or energy storage projects.

Ongoing issues
Chloe Beasley, a Houston resident and long-term recruiter for the energy sector, specialising in transmission, distribution, generation and high-voltage substations, described how rooftop solar is exploding, with many companies offering free installation on houses in leasing deals. Texas’ interest in renewables has snowballed since 2017, according to Beasley, despite unfounded criticism attempting to undermine their validity. For example, State Governor Greg Abbott and other Republicans tried to blame wind and solar for the 2021 Texas blackout. A subsequent investigation found that: ‘All major fuel sources underperformed against expectations save for solar. Natural gas was responsible for nearly two thirds of the total deficit. Gas underperformed by 37% compared to its expected output – more than 18 GW below expectations.’

Beasley was critical of ERCOT’s role in the 2021 freeze and holds it responsible for many of Texas’ electricity problems. Since the state’s grid is isolated, it cannot depend on importing (and exporting) power from and to other parts of the US when necessary. But instead of investing money into infrastructure, ERCOT has ignored problems with its transmission and distribution.

Beasley highlighted that ERCOT was warned about deficiencies in its grid ahead of the 2021 storm. Unfortunately, this situation has not improved significantly. Last year ERCOT projected an 80% likelihood of rolling blackouts if a storm with the magnitude of Winter Storm Uri hit Texas again.

In retrospect
Is ERCOT to blame for Texas’ grid woes?

On the one hand, Texas enjoys one of the fastest interconnection processes of any US state, helping to attract new wind and solar projects at scale. However, there is still a significant backlog with around 154 GW of solar, 166 GW of battery storage and 38 GW of wind projects awaiting connection at the start of this year. In part, this reflects a common problem globally, as transmission is struggling to keep up with the volume of generation projects.

However, it is further exacerbated by ERCOT processing projects on a ‘first filed’ basis, rather than by which is ready first. As such, many GWs represented in the queue for interconnection are placeholder applications ‘just in case’ – rather than ‘projects ready for construction’. The queue also reveals a shift in favour of constructing new solar.

On the other hand, ERCOT facilitated the growth in wind a decade ago when it developed 3,600 miles of high-voltage transmission lines under the Competitive Renewable Energy Zones (CREZ) scheme, which brought wind resources from west Texas to demand centres like Dallas.

At the same time, despite being technologically neutral, ERCOT has managed to grow wind and solar, while keeping electricity price competitively low for industry.

• Further reading: ‘Maintaining a stable electricity grid during the energy transition’. Renewable power sources impose many new demands on electricity grids built around large dispatchable point power generation sources, such as coal-fired power plants. Grid investment and expansion are not keeping pace with variable renewable energy deployment and the phase-out of dispatchable power capacity, creating associated risk to sensitive supply demand management needs, argues Debo Adams, Studies Manager, International Centre for Sustainable Carbon.
• As the start of the 21st century witnessed growing dialogues around climate change and recognition of the need for renewable energy sources, a contrary trend has emerged from the heart of the US: an upsurge in liquefied natural gas (LNG) production. This phenomenon not only marks a significant pivot in the US energy narrative, but also casts a long shadow on the global dialogue concerning environmental sustainability and the transition towards greener energy paradigms.