Texas Could Get a Fifth of Its Electricity from Solar Panels, but It Has a Long Way to Go

The sun shines brightly on Texas, and there's a lot of Texas for it to shine on. Little surprise, then, that Texas has the potential to generate more electricity from solar — more specifically, the solar panels people and businesses can install on their roofs — than any other state in the country besides California. According to a recent report from the National Renewable Energy Laboratory, Texas rooftops have the potential to supply 22 percent of the state's electricity every year.

This map summarizes things pretty well:
But right now? Right now solar power in Texas — all of it, both the small, rooftop panels discussed in the federal report and the huge, utility-scale solar farms in the middle of nowhere — is nowhere near its potential. While solar capacity in Texas has been rising steadily, with growth predicted to accelerate rapidly, it accounts for a paltry 534 of the state's almost 72,000 megawatts of generating capacity, or 0.7 percent.

Because of the gap between reality and potential, and because Texas has largely left it up to the free market to shrink the gap, the Center for Biological Diversity recently gave Texas an 'F' for solar policy in its "Throwing Shade" report on states with large untapped potential for rooftop solar.  The group advocates for aggressive installation of rooftop and similarly small-scale solar projects as an alternative both to conventional, fossil fuel-fueled electricity generation and big wind and sprawling wind and solar farms that are typically built at significant cost to wildlife and the natural environment.

Greer Ryan, the report's author, says that Texas actually does some aspects of solar policy quite well. For instance, unlike a majority of states, it explicitly allows third-party ownership of solar panels, which means businesses and homeowners can rent equipment rather than buy the equipment, which remains important to the growth of solar despite the plummeting cost of equipment and installation. Of the solar installed in the U.S. in 2014, 72 percent was third-party owned. Texas has also has strong solar-access laws, which, for example, prevent homeowners associations and developers from banning rooftop solar panels.

But, Ryan says, Texas falls short in several other key areas. The state has an unambitious renewable energy mandate that it has already met thanks largely to the explosive growth in wind power. "It's no longer creating this mandate for the state" to invest in renewable energy, Ryan says. Texas also lacks programs to help low-income residents move to solar power, which has been an important component of solar growth in places like California. Finally, and perhaps most important, Texas does not require utilities to offer "net metering," which is a jargony way of saying that the power company pays customers for the electricity their solar panels pump back into the grid.

Currently, four electricity providers in the state — the city of Brenham, the municipally owned electric utilities in Austin and San Antonio, and the private El Paso Electric — provide net metering, according to a national database run by North Carolina State University. The rest of the state's electricity consumers has no way to directly recoup an investment in solar.

Charlie Hemmeline, executive director of the Texas Solar Power Association, says the Center for Biological Diversity is "generally right to highlight our potential" but says the report's conclusions are based on the assumption that top-down mandates are the proper way to encourage the growth of solar power. 

"The thing about Texas is that we have a deregulated electricity market, which means that outcomes are driven more by customer choice than state policy. ...What's exciting to me is the innovation that's happening in the retail market," he said. He ticked off several solar-friendly programs that have been rolled out by utilities such as TXU Solar, which installs solar panels and lets customers use the excess electricity they generate as credits on future bills.