Environmental and Energy Law Blog

Monday, August 7, 2017

Solar Power Rising in West Texas

How do solar farms contribute to energy production?

Although Texas has long been the heart of the oil-patch, alternative forms of energy production  have been making inroads in the state, particularly in West Texas. While the rise of wind turbines has made the region a worldwide leader in wind energy, solar power has also become an important part of the mix.

The Oil Bust

Some observers attribute the rise of solar power, in part, to the collapse of oil prices in 2014. The downturn caused hundreds of workers at oil and gas companies in the Permian basin to lose their jobs. Moreover, the rural county lost about 20 percent of its $2.5 billion tax value, or about $500 million. Nonetheless, many of Pecos County’s  unemployed residents were quickly able to transition from the oil fields to take on jobs installing solar power panels in five solar farms that are now operating in West Texas.

Utility Scale Projects

These large projects are considered to be “utility scale” with the capacity to generate as much as 1 megawatt, enough energy to supply about 200 houses a day. The projects, along with two more that are slated to begin within the next few years, have the potential to add hundreds of millions of dollars to Pecos’ tax base.  

Although oil and gas production continue to drive the county’s economy, Pecos has become a hub for utility scale solar power. Moreover, solar farms have been a boon to this predominantly rural economy, a pattern that taking hold in similar regions elsewhere in America. Such economies have been devastated by the decline of the agricultural, manufacturing and coal industries while contending with the boom-and-bust cycles of oil and gas.

Currently, one of the incentives for going solar is that utility-scale projects are eligible for state tax abatements, up to 80 percent for 10 years. Moreover, Pecos is home to numerous transmission lines that  connect to the electric grids that serves population centers throughout Texas.

With more transmission lines expected to added in the coming years, Pecos County will likely see additional solar installations. In fact, solar power could potentially exceed the county’s 700 megawatts of wind energy. Ultimately, solar power could serve to stabilize the region’s economy as oil prices continue to remain below $50/barrel.

The Takeaway

In the end, Pecos is a model of how rural counties can benefit from renewable energy. At the same time, the development of solar farms presents a number of issues, not the least of which is land use. As West Texas continues to be a leader for energy production, these and other questions will continue to require the advice and counsel of experienced environmental and energy attorneys.

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