Texas Legislature subsidizes gas power plants, avoids worst attacks on renewable energy

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AUSTIN, Texas — Texas will subsidize the construction of new methane gas power plants, while raising costs for wind and solar energy, under legislation approved by the Legislature this week.  

SB 2627 and SJR 93 provide $7.2 billion in low-interest loans to support the development of up to 10,000 megawatts of new methane gas power plants. Another bill, HB 5, makes gas power plants eligible for tax breaks by providing abatements on school taxes. Under the bill, renewable energy projects and battery storage are no longer eligible for similar tax breaks. 

The Legislature rejected the worst attacks on clean energy, including a discriminatory permitting program for wind and solar, making renewables pay higher “ancillary services” costs, and even outright bans on renewable energy.  

However, under HB 1500, the ‘PUC Sunset’ bill, certain renewable projects will have to pay higher transmission fees and, starting in 2027, all renewable energy projects will be forced to secure very expensive backup capacity through “firming’ requirements. The PUC will also study the ancillary services cost allocation issue. 

In response, Environment Texas Executive Director Luke Metzger released the following statement:

“In a legislative session that saw an unprecedented effort to hogtie the growth of wind and solar energy, we are thankful that the Legislature ultimately rejected the measures most damaging to clean energy. Renewable energy is reducing pollution, saving consumers money, and playing a critical role in powering the grid.  

“The anti-renewable efforts were premised on a false claim. Lt. Gov Patrick claimed that “renewable energy failed to keep the lights on for millions of Texans” during Winter Storm Uri. Multiple studies and fact-checkers have found such claims are not true. While every energy source struggled under the extreme cold, failure to weatherize gas power plants and the gas supply chain were primarily responsible for the blackouts. Doubling down on gas is not going to make our grid more reliable, but it is going to make electricity more expensive and more polluting. 

“We need, and Texans want, more clean energy, not less. There is strong support for more wind and solar energy, more battery storage, more energy efficiency, and more interconnection with the national grid. Unfortunately, the Legislature ignored these solutions to strengthen our electric grid while protecting consumers and the environment.”