In Texas, demand for power peaks in the summer, which also happens to be when solar power is at its most productive. With the state slated to add up to 15 gigawatts of solar in the next few years, it spells big trouble for companies peddling fossil fuels – a $1.4 billion problem. Hear that tapping sound? It’s another nail being hammered in the coffin for fossil fuels.
The state’s solar boom could wipe out $2.76 per megawatt hour (wholesale) during the summer from fossil fuels, according to Bloomberg. Since gas and coal power generators rely on high summer prices to counteract the winter dip in demand, solar’s proliferation is a double-whammy threat to the industry.
Texas isn’t the only state to face this “problem.” California’s fossil fuel prices regularly dip into the negative during summer hours. The good news for fossil fuels is that this shift won’t happen right away. Texas will likely only have 1.8 gigawatts of solar power within the next two years.