In 2016 Keith Kaan started volunteering to install solar panels on Habitat for Humanity houses in his central Texas town of Mason as a donation. Keith’s friends saw what he had done and wanted the same for their own homes.
One thing led to another, and nine years later Greater Texas Solar, a company Kaan founded since founded, has powered 800 residences and businesses with solar energy and employs 10 full time workers.
“Solar is a great product, and it’s a great industry, and it’s great for young people to get into because it’s ever changing,” said Kim Kring, one of Kaan’s two co-owners.
Greater Texas is part of an exploding renewable energy sector in the Lone Star state. It might seem surprising that Republican-dominated Texas has now surpassed California as the leader in renewable energy, but it’s done so because its energy needs and anti-governmental philosophy has allowed companies to expand quickly. A boost from President Joe Biden’s Inflation Reduction Act has helped too.
Texas “is probably the most deregulated electricity market that exists in the world,” according to Joshua Rhodes, a research scientist at UT Austin.
But new state and federal policies are threatening Texas’s renewable energy–and its economy–by over-regulating the sector, halting investment and raising energy prices.
Renewable energy has thrived in Texas because companies there don’t have to deal with the red tape that slows projects elsewhere. In Texas, unlike other states, risk falls entirely to the energy supplier. That means a company can connect to ERCOT, the state’s energy grid, without time-consuming interconnection studies and permitting and zoning barriers that cause some 1,000 renewable energy projects to be taken offline every year and prevent others from ever connecting in the first place.
This streamlined, anti-regulatory system, combined with abundant sun and wind and large swaths of privately owned land, has helped Texas become the country’s leading renewable energy producer. It takes half the time to build a renewable energy project in Texas than it does elsewhere, according to Luke Metzger, executive director of Environment Texas, an environmental advocacy organization.
This isn’t just good for the environment – it’s also fueling Texas’s economy. Solar and wind now supply 30% of the state’s energy supply. But on a hot summer day that number can spike as high as 50% without any government mandates.
“It’s all the market,” said Rhodes, the research scientist.
Due to a combination of policy and innovation, the cost of renewables has dropped by as much as 90%, and they’re now more cost effective than fossil fuels, according to Robbie Orvis, a senior director at Energy Innovation, a clean energy think tank.
Renewable energy is paying off in Texas. Texans saved $31.5 billion on energy between 2010 and 2022 due to low-cost renewables, according to the state comptroller. And consumers stand to save another $115 billion in energy over the next 15 years because of them.
Renewable energy also drives down costs in another way: according to the Center for American Progress, a nonpartisan policy institute, burning fossil fuels costs Americans $820 billion dollars in healthcare each year.
And demand is only rising. Over the next five years ERCOT estimates that Texas’s energy needs are going to double due to population growth and planned data centers and crypto-mining facilities. It’s impossible to buy a new gas turbine before 2030 at the earliest, so without renewables Texas will struggle to keep its energy flowing – and at a much higher cost.
The IRA supercharged Texas’s already thriving renewable energy sector. Since its passage roughly $17 billion in clean energy investments have been announced in the state, along with nearly $10 billion from federal grants and loans, according to Energy Innovation.
Kring, of Greater Texas Solar, says the announcement of the IRA itself generated more calls to her company about commercial solar installations. She attributes the increase to the IRA creating a positive perception of renewable energy, which helped drive business. In fact, as much as 80% of IRA funding went to Republican-led congressional districts in the US, even though no Republican lawmakers voted for it.
But now some of those same lawmakers want to roll back the IRA. Repealing the act would halt the growth of renewables and raise energy costs for Texans by $90 a year in 2030 and $370 a year in 2035, according to E2, a nonpartisan renewable energy association.
And that’s not good for business. “If energy becomes more expensive, then we have less economic development, and that’s just bad overall,” said Rhodes, the research scientist. Abolishing the IRA would also cost Texas an estimated 87,900 jobs in 2030 and 115,000 jobs in 2035.
Those job losses would hit rural communities the hardest. Wind and solar sometimes provide the only economic opportunity in those areas. Working renewable energy jobs can result in an 8-19% income increase, and the vast majority of those don’t require four-year degrees, meaning they’re accessible to working class Americans. Just ask Kim Kring. The workers at her company come from disadvantaged backgrounds and make higher than average wages for the area, according to her.
But uncertainty is already taking a toll: in the first quarter of 2025 alone more renewable energy projects were canceled than the previous two years combined. Just as passage of the IRA created buzz for Kring’s business, talk of repeal has dampened it. She says she’s seen a roughly 30% decrease in calls for new projects in the past few months.
At the same time the Trump administration’s tariffs are raising costs. Kring said prices for imported materials her company uses, such as steel and lumber, already went up. And now levies of 3,251% were announced on imported solar panels. That’s a recipe for fewer new renewable energy projects, fewer jobs and less energy at higher prices.
Meanwhile two bills now working their way through the Texas legislature aim to restrict renewables. One would force half the state’s energy to come from natural gas, while the other would regulate new utility-scale renewable projects out of existence. “Renewables can be seen as a drought-proof crop,” said Rhodes, the research scientist, so that law would also put landowners’ income stream at risk.
The two laws together would slow business expansion, make ERCOT less reliable and grind renewable energy development to a halt. It’s far from certain these laws will pass – one energy expert gave it a 50% chance of happening. But it’s still possible less potent versions of those bills will take their place. The laws also demonstrate active, ongoing resistance to renewable energy in Texas despite its proven benefits.
“If you’re trying to stomp on renewables,” said Metzger, of Environment Texas, “where’s the energy going to come from? So it just doesn’t make sense.”
