Two weeks before President Donald Trump rejected the Paris climate accord, Texas’ largest power company bought a big solar project that could serve almost 57,000 homes.
The solar buy in West Texas is a first for Vistra Energy Corp., which used to be known as Energy Future Holdings and still relies on coal plants for half its generation capacity. Its retailing unit, TXU Energy, is now promoting “Free Nights and Solar Days.”
“I want to be very clear that this was largely driven out of demand from our retail side,” Vistra CEO Curt Morgan said about the purchase.
Even in Texas, where oil and gas dominate, there's a growing appetite for renewable energy. Recent examples include General Motors in Arlington, Facebook in Fort Worth and hundreds of 7-Eleven stores throughout the state.
Trump's decision is unlikely to change that momentum, but there are concerns about the potential fallout. His decision on Paris created a backlash abroad and resistance within the U.S. In the past, foreign leaders warned of a carbon tax on U.S. goods if he walked away.
If the fight over Paris deepens, Texas risks being on the wrong side of the divide. That could make it harder to attract businesses and newcomers, and to capitalize on a growing global market for clean energy.
Texas has an impressive record in the field. It was a pioneer in fracking and wind power, and has its own electric grid. More than any state, it has the expertise and technology to compete for clean energy business, said Michael Webber, deputy director of the Energy Institute at the University of Texas at Austin.
"We should be leading on these demands to reduce carbon," Webber said in an interview. "Because the world will want to buy more wind, solar and natural gas, which we can sell in abundance — and make ourselves very rich in the process."
Some key Texas leaders, including U.S. senators and a member of the Texas Railroad Commission, hailed Trump's move. But many others around the country said they'd continue to work toward the Paris goals. Dallas Mayor Mike Rawlings was among more than 200 mayors who pledged to honor the climate commitments.
Exxon Mobil, Google and Apple are among the corporations that support the pact. Disney's Bob Iger and Tesla's Elon Musk resigned from a presidential advisory board in protest. One news report said Trump had sparked a CEO revolt, and General Electric's top executive issued a call to action.
“Climate change is real,” GE's Jeff Immelt wrote on Twitter. “Industry must now lead and not depend on government.”
Disappointed with today’s decision on the Paris Agreement. Climate change is real. Industry must now lead and not depend on government.
— Jeff Immelt (@JeffImmelt) June 1, 2017
Texas, best known for oil and gas, is easily the largest producer in the U.S. But it's also the leader in wind power, with three times the capacity of the next-closest state. And solar is coming on fast. Wind and solar employed 36,000 Texans in early 2016.
Last year, wind power accounted for 15 percent of the energy used on ERCOT, the grid that powers most of Texas and the Dallas area. Wind’s share of the market has roughly doubled since 2010 while coal plants lost over 10 percentage points.
Generation from natural gas grew strongly, overtaking coal, and the cleaner-burning fuel has cut emissions significantly. Natural gas and renewables, including wind, provided 59 percent of ERCOT power last year, compared with 49 percent for the country. Texas also had a smaller share from coal than the U.S.
Trump justified leaving the Paris accord, in part because it would preserve jobs in the coal industry. But clean energy employs more nationwide and has been growing fast — up 25 percent in solar and up 32 percent in wind in the latest year.
In early 2016, solar and wind power accounted for 475,000 U.S. jobs, nearly three times more than coal, according to the U.S. Department of Energy.
The cost of wind and solar power has been falling steadily, making it easier for consumers and corporations to demand it.
Last month, Facebook opened a Fort Worth data center powered entirely by wind. In Arlington, the giant GM assembly plant is planning to get all its electricity from renewable sources by next year. In April, 7-Eleven signed an eight-year deal with TXU Energy to use only wind power in 425 stores in Texas.
Young customers care about sustainability and environmental impacts, said 7-Eleven's Ben Tison. "They’re paying attention to what companies are doing.”
And that isn't going to change. In December, ERCOT made a long-term assessment of the electric market. In every economic scenario, it projected solar generation would grow and older coal and natural gas plants would be retired.
Within 15 years, solar installations will increase over 20-fold, the report said. That makes the opposition to Paris even more confounding.
“It’s sort of crazy,” UT’s Webber said. “As a state, we’re on the right track. I don't know why we are arguing against out our own economic interests.”
