Abstract

While Texas political leaders openly dismiss and mock the risks of climate change and suspiciously eye policymakers in other states or countries who seek to reduce emissions, Texas industry, consumers, and cities are decarbonizing and doing so faster than those same countries. A recent study exploted multiple pathways for getting emissions down even farther.

Article

Everything is bigger in Texas. I’m probably not the first Texan to tell you that. But the sheer size of Texas-greater in area than France, with a larger population than Australia-means that when thinking about its economy, the best comparisons are with nation-states rather than U.S. states.

By itself, Texas would comfortably be a G7 country, with a gross domestic product ahead of Italy and Canada and gaining on France. It would be the seventh largest cotton producer, for instance, and the eleventh largest manufacturing country by output. In terms of energy, Texas alone would be the third largest natural gas producer, and the fourth largest oil producer, behind only Russia, Saudi Arabia, and the remainder of the United States.

But all that activity has a cost in terms of carbon emissions. The U.S. Environmental Protection Agency pegs the state’s greenhouse gas emissions—from all sectors of economic activity and including a credit for changes in land use—at equivalent of 787 million tons of carbon dioxide, which on its own would be sixth in the world and larger than Germany, South Korea, or Canada. State regulators have been eager to turn a blind eye to environmental impacts such as methane flaring, venting, and fugitive emissions from oil and gas production. The association between Texas and profligate carbon emissions is so tight that the state is losing business from companies and organizations that have prioritized climate action.

While Texas political leaders openly dismiss and mock the risks of climate change and suspiciously eye policymakers in other states or countries who seek to reduce emissions, Texas industry, consumers, and cities are decarbonizing and doing so faster than those same countries that they mock.

Texas produces more than a quarter of U.S. wind-generated electricity; as an independent country, it would be the fourth largest wind power producer in the world in 2022. Solar has been a late bloomer—in 2018 only around 4 TWh of solar electricity was generated in Texas—but it has been growing fast. Last year, utility and small-scale solar in Texas generated more than 25 TWh, and the Energy Reliability Council of Texas, the state’s grid operator, reported during the heat wave that pounded the state this past summer that solar power accounted for as much as 20 percent of the state’s power needs during parts of the day.

In addition to all that, Texas is a world pioneer of carbon sequestration, a global leader for producing clean fuels such as hydrogen, and the home of some of the most innovative companies looking to tap geothermal energy.

We are headed in the right direction on climate technology deployment because we have abundant resources of clean energy, plenty of space to deploy them, a philosophical tradition of making money from our land, a desire by consumers to save money (which aligns nicely with the cost-competitiveness of renewables), and a readiness and ease of developing big projects.

Last year, I worked with colleagues at the University of Texas, including lead author Isabella Gee, as well as experts at other universities and in the private sector to produce a menu of options for moving the state’s economy to net-zero emissions by 2050. It forms the heart of our study, Don’t Mess with Texas: Getting the Lone Star State to Net-Zero by 2050. Astonishingly, we discovered that 70 percent of the effort toward net-zero—including the phase out of coal-fired power plants—is part of the business-as-usual that companies are planning to do anyway as part of their normal operations.

There are multiple pathways to achieving that final 30 percent, and all the ones we examined produce higher statewide economic benefits and overall better outcomes than the business-as-usual trajectory. But we also found differences in outcomes. Pathways that prioritize electrification will lead to the most efficient overall economies; those that prioritize hydrogen and carbon capture have the best labor match-up with the existing fossil fuel industry.

Texas can get all the way to net-zero, even if its oil-soaked history, tradition, and politics argue against it. In fact, Texas is uniquely positioned to lead the world in the transition to a carbon-neutral energy economy. Outlining the path to that outcome can provide lessons for the other countries that actually want to decarbonize.

ELECTRIC GLIDE

There are many ways to fully decarbonize the Texas economy across all sectors by 2050. To understand the range of possibilities, my colleagues and I modeled changes to end-use sectors, demand management, electrification, and technology development and adoption to evaluate the systemic energy requirements for reaching net-zero emissions across multiple scenarios. In addition to the business-as-usual scenario that we used as a baseline, we used a detailed power sector model to identify the least-cost options for supplying electricity under these conditions.

The net-zero pathways we examined focused on electrification, hydrogen, and carbon management. But all of these have the market-driven, business-as-usual scenario as the starting point—and it’s a good one. Existing market forces are dictating that all the state’s coal power-generating stations will close by 2035. Compared with relatively clean, cheap and abundant natural gas, wind, and solar power, coal-fired power plants lose their competitiveness. A decarbonizing power sector thus becomes a critical piece of decarbonizing the rest of the economy as Texas electrifies industry, transportation, building heat, and agriculture. A key co-benefit of decarbonization is the accompanying reduction in criteria pollutant emissions (of gases that cause acid rain, particulate matter, and so forth). Reduced air pollution in a low-carbon future leads to greater public health, and thus economic, benefits across the state, which our analysis captures. And according to current projections, carbon emissions from transportation also should fall as electric vehicles reach about 50 percent of new light-duty vehicle sales and 5 percent of heavy-duty vehicles by 2050.

The business-as-usual scenario is rosier than most casual observers would imagine. We are cutting emissions by two-thirds by giving businesses and consumers what they already want and expect. Removing the final 30 percent of emissions will require some effort, but the end result is positive across almost every dimension we looked at.

Two of the pathways we examined involved electrification—reducing or even essentially removing carbon fuels from the equation altogether. In these scenarios, the new vehicle fleet is entirely electric by 2050, as are buildings as homes and businesses swap out gas furnaces and stoves for electric units.

Other fuel-using sectors, such as aviation and industry, are electrified as much as possible or switch from carbon fuels to hydrogen.

Electrification with clean power is the key enabler for reducing emissions from sectors such as transportation, industry, agriculture, and residential/commercial buildings. Electrification also helps promote efficiency, as electric devices are often more efficient than thermal versions. For example, the drivetrain of an electric car is about 90 percent efficient, whereas a combustion engine is usually 15 percent-to-25 percent efficient. Even if the electric car is plugged into an old coal plant with 30 percent efficiency, it’s still more efficient to drive the electric car than the old thermal one. Electric heat pumps are also more efficient than natural gas furnaces.

While moving processes from fuel-based to electric-powered will require adding to grid and generating capacity, these efficiency improvements mean that we don’t have to make Btu-for-Btu substitutions. An electrified Texas will require less energy overall to operate than today’s Texas.

Those two electrification pathways differ in their zeal for reaching zero net emissions in the electric industry. One path goes straight for zero emissions by 2035 and beyond, which means retiring not only the state’s coal fleet but also its natural gas turbines as well. Essentially, in addition to multiplying its wind and solar power generating capacity plus storage, Texas will need to build out geothermal and nuclear (both conventional and small modular reactors (SMRs)) infrastructure equal to today’s coal fleet.

The other electrification pathway is less rigorous, allowing a small number of natural gas turbines to stay online. This capacity enables the grid to operate with about a quarter less storage capacity and no SMRs. That would bring down the cost of reaching net zero but requires adding carbon capture and storage infrastructure. While the cost of carbon capture could erase some or all the savings of forgoing SMRs, it does mesh well with the state’s existing expertise. More on that in a bit.

HARDER TO DECARBONIZE

Another pathway our team examined was replacing some carbon-based fuels with hydrogen produced from electrolysis or natural gas with CO2 capture. Hydrogen can also be produced via other pathways, such as pyrolysis, thermolysis, and extraction from geologic sources, but those were not modeled for this study.

When we modeled this path, we found that the electric grid still decarbonizes by more than 90 percent—mostly due to the superior economics of non-carbon sources of electricity. But one of the advantages of this path is the ability to produce hydrogen through low-cost wind power, and then apply that hydrogen to tasks that are less suitable to electrification. Industry will still need clean molecules for the parts of the economy that are hard, expensive, or impractical to electrify, including aviation, marine transportation, high temperature industrial heat, heat for old buildings in cold climates, and chemical manufacturing. For these applications, hydrogen or hydrogen carriers (such as ammonia) can get us to lower life cycle greenhouse gas emissions more quickly and robustly than waiting for electric solutions.

To be sure, the hydrogen pathway is water-intensive if the hydrogen is made from electrolysis of water. A decarbonization path that depends on electrolysis shifts environmental impacts from the atmosphere to our water systems. And the electrification paths, which rely on building a lot of wind and solar and direct air capture systems for scrubbing CO2 out of the atmosphere, are land intensive. Even amid the positive outcomes of the hydrogen path— and by leveraging its existing hydrogen infrastructure and industrial capacity, Texas can become a leader in hydrogen production, which can provide substantial economic bene-fits—there will be some negative impact. This is one of the key lessons of this work and other energy systems analysis: There is no fuel or technology option that is devoid of impacts, so the goal for designing a suite of solutions need is to minimize impact rather than chasing the fantasy of eliminating it.

The fourth path we looked at involved a focus on carbon management: The extensive use of carbon capture technology to allow a continued reliance on a substantial level of carbon fuel while still achieving net zero emissions. Carbon management involves carbon capture either at the point of emissions (where CO2 emissions are usually 5 percent-to-15 percent of the flue gas composition for power plant smokestacks, but much higher at ammonia factories, ethanol biorefineries, and gas processing sites) or via direct air capture systems, a newer technology that scrubs out CO2 under ambient conditions with 0.04 percent concentration in the atmosphere. Those systems will enable the Texas economy to operate with netzero emissions while allowing for some industries to continue to use carbon-based fuels or carbon-emitting processes, such as in the manufacture of concrete.

Industrial operations in the state already capture carbon dioxide and pipe it to injection wells, where it is used to enhance oil production; direct air capture facilities could be sited close to geologic storage.

Most of the processes involved with carbon management have key points of contact with the oil and gas sector, whose industrial might ought to be able ought to be able to deploy it at scale with the proper incentives. What’s more, Texas has large chemical and refining industries that might be difficult and expensive to fully decarbonize through retrofits, process reconfiguration, or advanced techniques. Partially decarbonizing these industries and using direct air capture to remove the remaining emissions would be more cost effective. And obviously, direct air capture would be a technology that Texas industries could export to the rest of the world.

These four pathways offer a menu of choices, rather than a single blueprint, for decarbonization. It is likely that we will see a combination of options implemented.

CHALLENGES

The work our team conducted was very encouraging. In spite of the talk from politicians, the models we worked with show that taking action to eliminate carbon emissions can spur economic growth and create jobs. Going net-zero also provides opportunities to improve energy-system resilience and mitigate the impacts of extreme weather events because of the diversification of the fuel mix and implementation of more flexible energy tools. There are also non-trivial equity benefits for fenceline communities (that see air pollution and truck traffic decline) and rural areas (that see jobs and investment increase from the deployment of renewables, carbon capture, and remote hydrogen production).

And some of the steps are downright easy. Above, I mentioned that market forces already are pushing the electric generating section toward at least partial decarbonization. But another step that should be noncontroversial is investing in efficiency to lower the magnitude of the task of reaching net-zero emissions. Efficiency is quick and cheap to implement compared with completely transforming the economy or expanding our energy infrastructure. And every unit of energy we do not consume should help us avoid emissions while saving consumers money on their utility bills. Together with “clean-up-your-act” policies (such as eliminating flaring, venting, or fugitive emissions from oil and gas operations) and electric transportation, efficiency is an effective, low-hanging fruit with low barriers to entry.

But the paths to net-zero emissions rely to greater or lesser extents on carbon management systems, such as direct air capture and sequestration, coming online and scaling up fast. With those technologies in place, there still might be emissions from the hardest-to-abate industrial processes, but they will be removed and managed.

Aggressive deployment of carbon removal devices sounds expensive and thermodynamically challenged. Which it is. And it will require building out a fleet of wind turbines or solar farms (and hopefully geothermal and nuclear, too) to provide the clean power to operate those facilities. But it also opens up the prospect for taking the economy carbon-negative by making biofuels whose CO2 is sequestered after use. In this case, the goal isn’t just to reach net-zero, but to go net-negative so that 200 years’ worth of CO2 emissions can slowly but surely be removed from the atmosphere until we eventually restore it to pre-industrial CO2 concentrations.

It is a very big challenge, but that’s to be expected. Everything is bigger in Texas. In the spirit of leaving things better than we found them, this concerted effort to reduce and then remove CO2 emissions will be the ultimate expression of love for future generations.

If Texas is willing to go big with these steps—and despite the political rhetoric, we are underway—then every country and locality in the world can take them, too.