The U.S. Energy Information Administration (EIA) forecasts that utility-scale solar generation in Texas' ERCOT grid will exceed coal-fired electricity generation on an annual basis for the first time in 2026 as new solar projects come online and electricity demand continues to grow.
What is changing in Texas' power grid?
According to the EIA's latest Short-Term Energy Outlook, utility-scale solar power generation in the Electric Reliability Council of Texas (ERCOT) region is expected to reach 78 billion kilowatt-hours (BkWh) in 2026, surpassing the 60 BkWh forecast for coal generation.
The milestone would mark the first time annual solar generation exceeds coal generation within the ERCOT grid, which serves most of Texas.
While natural gas remains the state's dominant source of electricity, solar energy has become an increasingly significant contributor to Texas' energy mix.
Why is solar generation increasing?
The EIA attributes the growth largely to continued utility-scale solar development across Texas as power providers work to meet rising electricity demand.
Between 2021 and 2025:
- Solar's share of ERCOT electricity generation increased from 4% to 12%.
- Coal's share declined from 19% to 13%.
- Natural gas remained the largest source of generation, averaging 44%.
The EIA expects Texas to account for approximately 40% of all new utility-scale solar capacity additions nationwide in 2026.
One of the largest projects expected to come online in 2026 is the Tehuacana Creek 1 Solar and Battery Energy Storage System, with an expected capacity of 837 megawatts.
What's driving electricity demand?
The EIA says electricity demand in Texas continues to increase due to expanding data centers, cryptocurrency mining operations, industrial growth, and ongoing oil and gas production and processing activities.
Looking ahead, the agency predicts solar generation will risde to 99 BkWh in 2027.
The Bottom Line
Federal energy forecasters expect solar power to continue expanding rapidly in Texas, with utility-scale solar generation projected to surpass coal generation annually beginning in 2026 as new projects come online and electricity demand continues to climb.
