Texas surpasses California as grid-scale solar energy production leader

Texas recently surpassed California in grid-scale solar energy, solidifying its lead in the alternative energy sector, where Texas wind power has long been the national leader.

Today the organizations that operate each state-level grid (CAISO in California and ERCOT in Texas) report Texas has 22,163 megawatts of installed grid-scale solar capacity as of October 25, 2023, whereas California has 17,277 megawatts as of October 5, making Texas now the nation’s grid-scale solar leader.

As of the first quarter of 2023, Texas wind capacity was 40,556 megawatts, whereas California’s was just 6,103. Texas has long had a major advantage over California in wind, but in 2019 produced less than one fifth of the solar California did. Texas would go on to double its solar capacity in just 2020, and again in 2021, and nearly again in 2022 — by the beginning of 2023, Texas was just about 1,000 megawatts behind California in grid-scale solar capacity.

So how was Texas able to become the nation’s solar power leader so quickly?

R Street Institute Texas Director and Resident Senior Fellow in energy Josiah Neeley told The Center Square the answer is in how California and Texas energy markets and regulations are structured.

“These are two models about how you can get renewable energy deployment. In California it’s been very mandate and subsidy heavy. In Texas the growth of solar has been very rapid and it has not been because the state is doing a lot to encourage the development of solar power. The big thing Texas has is the competitive electricity market,” Neely said.

In Texas, almost anyone who wants to or thinks they can make money selling electricity to the grid can build power and connect it to the state’s power system. On the retail side, consumers are free to choose their energy provider, and that includes the choice of clean energy, a sector that has seen significant growth in demand from consumers, explained Neely.

“You first saw that with wind, which ramped up really quickly,” Neely said. “Solar was a bit of a laggard because it couldn’t compete with wind, but as soon as the price got low enough and made economic sense it bloomed.”

Nationally, the cost for utility-scale solar panels that track the sun declined from $5.66 per watt in 2010 to $2.08 per watt by 2015 and just $1.01 by 2020, dramatically transforming the economics of solar energy.