economy

Texas Comptroller Energy Tour: Wind Energy Overview

Wind Energy Snapshot | Print Snapshot (PDF)

Introduction

Texas has long been a leader in the energy industry; its abundance of fossil fuels and renewable sources generate electricity for the state and make substantial contributions to the Texas economy. Texas’ energy use is tied to its large population, hot climate and extensive industrial sector, and the state depends on reliable and affordable energy. One important source of energy for the state is wind power.

Background

Wind power has been harvested for centuries for propelling ships, milling grain, pumping water and other purposes, but the widespread use of utility-scale wind turbines to convert wind energy to electricity began only 30-40 years ago and is growing rapidly. (“Utility scale” refers to turbines with at least 1 megawatt (MW) of electric generation capacity.) According to the U.S. Energy Information Administration (EIA), the share of U.S. electricity generation from wind energy has grown from less than 1 percent in 1990 to 10.2 percent in 2022.¹

A wind turbine generates energy using the aerodynamic force from the rotor blades. As wind flows across the blades, it causes the rotor to spin. The rotor connects to a generator, creating electricity. This electricity is then delivered to the end-user through transmission and distribution lines throughout the state. (Exhibit 1).

Most large wind turbines have a horizontal axis with three blades attached to a tall tower, typically 300 to 415 feet tall.² In 2022, newly installed turbines had an average capacity of 3 MW.³ Turbines are grouped together to create wind farms, which may consist of several hundred individual wind turbines distributed across a vast area.

China leads the world in wind energy production: In 2021, it had an installed capacity of almost 329 gigawatts (GW) — about 2.5 times the installed capacity of second-ranked U.S., which had 132.7 GW. Germany, India and Spain were the next biggest wind energy producers, with installed capacities of 64 GW, 40 GW and 27.5 GW, respectively.⁴

Source: U.S. Energy Information Administration

As of May 2023, the U.S. Geological Survey’s Wind Turbine Database recorded more than 72,731 turbines in the U.S. with a total rated capacity of 142.2 GW.⁵ Wind is the fourth-largest source of electricity generation in the country, with enough power to serve the equivalent of 46 million homes.⁶

Wind Energy in Texas

For the past 17 years, Texas has led the U.S. in wind energy production. In 2022, Texas had 40,556 MW of installed capacity — more than a quarter of all wind-sourced electricity in the U.S.⁷ Wind power generation surpassed the state’s nuclear generation for the first time in 2014 and exceeded coal-fired generation for the first time in 2020.⁸ In 2011, Texas became the first state to reach 10,000 MW of wind generating capacity and remained the only state with that capacity until 2020.⁹ Today, there are 239 operating wind projects in Texas, according to CleanpowerIQ, an online data platform the American Clean Power Association, most of which have generating capacities larger than 10 MW. Texas also has more than 15,300 wind turbines, the most of any state.¹⁰

Many areas in Texas have the appropriate wind conditions and space necessary for the development of wind power generation. In 2005, the Texas Legislature directed the Public Utility Commission to establish Competitive Renewable Energy Zones (CREZ) to facilitate the construction of transmission lines from areas where wind energy was generated to other, population dense areas of the state. The project, completed in 2013, built a network that included approximately 3,500 miles of high-voltage transmission lines capable of carrying 18,500 MW of wind power to population centers in Central, North and East Texas.¹¹ Today, CREZ lines serve as an example of how private investments in infrastructure can spur further energy development for the benefit of consumers, who are estimated to have saved $31.5 billion on wholesale power prices between 2010 and 2022 due to the inclusion of low-cost renewable energy.¹²

Los Vientos Wind Farm and the Roscoe Wind Complex are two of the largest wind farms in the U.S. Ten wind farms in Texas currently have the capacity to generate 500 MW or more (Exhibit 2).

Name	County	Installed Capacity (MW)
Los Vientos Wind Farm I-V	Starr and Willacy	912
Roscoe Wind Complex	Fisher, Mitchell, Nolan and Scurry	782
Javelina Wind Energy Center	Webb and Duval	749
Horse Hollow Wind Energy Center	Taylor and Nolan	736
Capricorn Ridge Wind Farm	Coke and Sterling	663
Penascal	Kenedy	605
Sweetwater Wind Farm	Nolan	585
Buffalo Gap Wind Farm	Nolan and Taylor	523
Spinning Spur	Oldham and Potter	516
South Plains	Floyd	500

Sources: U.S. Energy Information Administration

The Roscoe Wind Complex, comprised of four wind farms, is collectively one of the largest wind farms in the U.S. and is spread across 100,000 acres and four counties. Roscoe, the second largest wind farm in Texas, has 627 wind turbines and is capable of providing wind-generated energy to 234,000 homes.¹³ The Roscoe Wind Complex has remitted more than $92 million in local taxes since 2008.¹⁴

In addition to existing wind farms in Texas, the U.S. Department of the Interior announced plans for offshore wind farms off the Texas coast within the next few years. These planned wind farms, to be auctioned and leased to private power generation companies, are anticipated to be more than 300,000 acres in size and are expected to generate wind energy for more than 1.3 million homes.¹⁵

The Electric Reliability Council of Texas (ERCOT) manages the flow of electricity to more than 26 million Texas customers — about 90 percent of the state’s electric load. According to ERCOT, wind power represents 28.6 percent of its 2023 generating capacity, second only to natural gas (41.8 percent). ERCOT’s record wind generation was 27,044 MW on May 29, 2022.¹⁶

Wind generation in Texas has steadily increased during the past decade. In 2021, wind generation was about 99 million megawatt hours (MWh, meaning one megawatt generated per every one hour), up from roughly 32 million MWh in 2012.¹⁷

Annual Texas Wind Generation (MW Hours in Millions)

Year	Generation (MWh in millions)
2012	38.44
2013	38.31
2014	39.29
2015	39.35
2016	42.08
2017	38.58
2018	41.19
2019	41.30
2020	41.44
2021	40.21

Source: U.S. Energy Information Administration

Current Issues

Transmission and Storage

Ideal wind sites often are in lower density population areas and require significant amounts of land. Transmission lines are needed to bring electricity from wind farms to populated areas where electricity is needed to meet surging demand from consumers and industry. Transmission buildout also supports reliability by providing more avenues for electric generation to reach consumers, including and especially during extreme weather conditions. Upgrading the state’s transmission network to connect areas with abundant wind resources to population centers could significantly reduce the costs of expanding land-based wind energy.¹⁸

Additionally, wind power, while affordable, is a variable source of electric power generation, meaning that it only generates electricity when the wind is blowing. Improvements in forecasting and technology, however, allow ERCOT to know how much wind power will be available in advance. Utility-scale battery storage allows excess energy produced to be stored and shifted to periods when there is high demand to support increased reliability. However, battery storage technology currently is cost prohibitive for many wind farms. Although few wind power facilities in Texas store excess power in batteries, this practice may become more common as advances in technology decrease costs.

Curtailments

To ensure power system reliability, grid operators continually balance electricity supply with demand and work to ensure the safe transfer of power along transmission and distribution lines. ERCOT, therefore, must curtail, or reduce, wind generation when more wind power is available than what can be safely transmitted on available transmission lines due to inadequate transmission capacity or when wind power’s contribution to the grid outpaces demand.

According to a recent analysis by the EIA, ERCOT curtailed 5 percent of its available wind generation in 2022 due to limited transmission line capacity. The EIA, which predicts the Texas power market will double by 2035, foresees more curtailments unless the state’s transmission system is upgraded. Without significant upgrades, wind curtailments could increase to 13 percent of available wind generation, impacting ERCOT’s ability to reliably meet demand.¹⁹

Environmental Concerns

Wind farms’ impact on the environment differs from the impact of natural gas and coal-fired power plants, whereas wind farms do not produce carbon emissions and have less negative environmental impact than other sources of energy. There are concerns from the public, however, about the noise produced by turbine blades and the potential visual and physical pollution of wind farms on the landscape.²⁰

Texas Wind Industry Economic Impact

According to the 2023 U.S. Energy and Employment Report, in 2022 there were 26,135 Texas jobs in wind-related electric power generation, accounting for 20.8 percent of the 125,580 U.S. jobs. Nearly two-thirds of U.S. wind-related electric power generation jobs are in the construction and professional services industry sectors.²¹

According to Chmura, a labor and economic market research consulting and software firm, wind electric power generation jobs contributed $1.7 billion in gross domestic product to the Texas economy in 2021. In addition, wind energy projects expand the tax base for communities, which is particularly important in rural areas that often incur reductions in tax collections from agricultural exemptions. During the lifetime of a 100 MW wind energy project, a county can expect to receive $16.8 million to $20.3 million in tax revenue.²²

Since the 1990s, federal and state governments have established financial incentives and requirements to use renewable energy sources in response to environmental concerns. The U.S. production tax credit (PTC) is a temporary tax incentive that provides a per-kilowatt (kWh) credit for electricity generated from renewable sources, such as wind energy. The PTC, enacted in 1992, was recently extended in 2020 and allowed eligible wind projects to begin construction with this incentive by December 2021.²³

The Texas Economic Development Act (Chapter 313) offered new businesses a value limitation on the appraised value of their property in exchange for creating a specific number of jobs and building or installing new property worth a certain amount. As a result, 241 wind energy-related projects plan to invest more than $50 billion during the life of their agreements and have committed to creating 1,044 jobs.²⁴ While the Chapter 313 program is no longer in effect, the projects generated during its tenure continue to operate.

Outlook

Wind power continues to grow in Texas as advances in wind energy technology have decreased the cost of investment. Government requirements and financial incentives for renewable energy in the U.S. and in other countries have contributed to growth in wind power. Such growth, however, produces challenges for industry employers to fill jobs: A 2019 report by the U.S. Department of Energy’s National Renewable Energy Laboratory found that 68 percent of industry representatives have had difficulty hiring.²⁵

To combat employment gaps in the wind industry, there are various wind-related educational programs in Texas aimed at providing individuals with the opportunity to gain skills needed to work in the wind industry. One example is Texas Tech University’s National Wind Institute, which provides multidisciplinary training focused on energy systems, atmospheric measurement and simulation, and wind engineering to prepare students to “answer today’s complex challenges.”²⁶