Energy is one of the oldest and most diverse industries in Texas. Since the discovery of the Spindletop oilfield in 1901, Texas has embodied the production of Energy. In 2004, Gov. Rick Perry identified Energy as one of six industry clusters in his long-term, strategic job creation plan. Each cluster was selected because of its powerful potential for future economic growth.
The Energy cluster is made up of three subclusters: Oil and Gas Exploration and Production; Electric/Coal/Nuclear Power Generation; and Renewable and Sustainable Energy Generation. Texas’ geography and natural resources, excellent transportation systems, and skilled labor force and leadership in environmental research give the state a Lone Star advantage in Energy.
Oil and Gas Exploration and Production
Oil and gas exploration and production is one of Texas’ most established industries. In both crude oil and natural gas, Texas leads the United States in production and reserves. Texas also leads the nation in enhanced oil recovery potential.
Texas crude oil reserves represent almost one-fourth of the U.S. total, and Texas natural gas reserves account for over three-tenths of the U.S. total. While new oil and gas reservoirs are being discovered on an ongoing basis, the largest increment of oil yet to be produced is likely to come from existing reservoirs.
Electric/Coal/Nuclear Power Generation
Texas leads the nation in electric power production and is a major nuclear power generation state. The state is top ranked nationally for coal production and is the largest producer of lignite coal, which constitutes nearly all of the near-surface coal resources in Texas, and is most commonly used in electric generation plants.
Texas is the only state with its own power grid, and boasts one of the most robust, well-functioning electric markets in the world.
Natural gas-fired power plants account for about 50 percent of the electricity produced in Texas and coal-fired plants account for most of the rest. Texas produces a substantial amount of coal from its 11 surface mines, including five of the nation's largest.
Texas has approximately 4,800 megawatts (MW) of installed nuclear power capacity generated at two plants; The Comanche Peak project and the South Texas Project. Nuclear energy supplies less than 10 percent of the electricity generated in Texas.
Renewable and Sustainable Energy Generation
Texas is better known for its oil wells than its wind turbines; nonetheless, the state currently leads the nation in renewable energy potential and in wind energy production.
Texas has been the nation's top wind producer for the past five years, according to the American Wind Energy Association (AWEA). The AWEA estimated that Texas had an installed wind generating capacity of 9,410 MW in 2009. The state added 2,292 MW of new wind power capacity last year, more than twice as much as any other state. A number of the nation's largest wind farms are located in the Lone Star State. If Texas were a nation, it would rank No. 6 for installed wind power capacity, behind Germany, the rest of the U.S., Spain, China, and India.
Although renewable energy sources contribute minimally to Texas' power grid, the state's 2005 Renewable Portfolio Standard (RPS) mandates the construction of certain amounts of renewable energy and has prompted the renewable energy industry to rapidly accelerate its production. Recent state legislation has laid the groundwork for large transmission lines, which will further accelerate the use of wind power in the state, and additional wind power facilities are currently under construction.
Other renewable energy technologies that Texas is pursuing include solar, geothermal, wave or tidal energy, biomass and methane gas, and hydropower.
Industry Links
The Energy Report 2008
Texas Wind Energy Overview
Texas Wind Energy Directory
Solar Energy Overview
Texas Renewable Energy Resource Assessment (external link)
