June 14, 2016 | By RGR Marketing Blog

So Why Isn't the Texas Solar Market Taking Off?

Texas is a very large state both in terms of population and area. Add to that the fact that the Lone Star State has a tremendous amount of open space, currently unused for much except for ranching, the fact that it currently has the lowest purchase and installation costs per kilowatt of any state, and the fact that it gets more sunshine than practically anywhere else in the country and you have a great recipe for solar power generation.

In fact, by some estimates Texas may have as much as twenty percent of the overall potential capacity for solar power generation in the United States, right behind California. So why then does Texas rank tenth in overall solar adoption and generation?

 

Texas is behind some obvious competitors besides California, in terms of available space and plenty of sunshine like Arizona, Nevada, and Colorado. But, it also ranks well behind New York, New Jersey, and even Massachusetts in terms of both megawatt capacity and homes with installed solar power system. This despite having well developed wind-power generation throughout the state and a position as a leader in energy production and energy ingenuity.

The answer lies in the combination of the state’s booming conventional energy production, and the state’s lack of beneficial solar power policy.

Conventional Energy

Part of the reason that solar has had difficulty getting off the ground in Texas, is the simple fact that Texas produces an abundance of cheap fossil fuels. The state is number one in overall energy production thanks to its oil fields, refineries, and natural gas wells. Natural gas is in direct competition with solar for electricity generation in the state and is currently less expensive.

Policy Problems

Despite the problem that the competition from natural gas and other conventional power sources represent in Texas, the major thing holding back the realization of the state’s potential for solar generation is a lack of policy supporting solar.

In nearly every state that is ahead of Texas in terms of solar power adoption, there are policies that provide rebates and tax incentives to offset the start up costs of going solar, as well as net metering programs to further incentivize solar power over conventional power.

Net metering programs guarantee that solar consumers that are still hooked up to the grid are compensated for the surplus power their systems push to the grid during peak generation, off setting the cost of the power they pull from the grid at night and during bad weather. Texas has no such program.

Cashing in on Potential

Eventually the potential for inexpensive, sustainable power generation in Texas will be too great to keep consumers and energy companies from getting into the solar power generating game.

Unfortunately, the tipping point may come in the form of great energy market volatility, unless the state government will foster sustainable power development through incentivizing solar.

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