How to buy or sell renewable power in Texas

Buying a renewable electricity plan

Several Texas retail providers sell plans backed by renewable sources — wind, solar, or a mix. It typically costs a bit more than a plan backed by conventional generation, though that gap has narrowed as renewable capacity has grown. When you sign up for a renewable plan, you're not literally wiring specific electrons from a specific wind farm into your house — the actual electricity reaching your home is always the same shared grid mix everyone else draws from. What you're really doing is directing your provider to purchase and place that percentage of renewable power onto the grid on your behalf, which increases the real, statewide demand for renewable generation. Every plan in our results shows its actual renewable percentage pulled from the provider's own disclosure, so you can weigh it directly against price instead of guessing from marketing language.

Installing your own solar or wind (distributed generation)

If you install solar panels, a small wind turbine, or another power-generating system at your home, that's called Distributed Renewable Generation (DRG). Most homeowners size a DRG system to offset their own usage, but there will likely be times you generate more than you're using in the moment — and that excess can potentially be sold back.

Selling your excess power: it depends on where you live

If you're in a deregulated area (the part of Texas this tool is built around), you can sell excess DRG power — but only to the retail provider you already buy your electricity from, and that provider is not required to purchase it. Some providers that do buy back excess power require you to also be on one of their specific retail plans; others let you choose your buy and sell arrangements independently. Either way, before you install anything, you'll need to sign an interconnection agreement with your local Transmission and Distribution Utility (TDU) — the same delivery company already listed on your bill.

If you're in a municipal or cooperative service area (Austin Energy, CPS Energy, or one of Texas's many electric co-ops), there's no retail competition to shop, so you'd contact that utility directly about buying back excess DRG power and get an interconnection agreement from them describing their terms.

If you're served by a regulated utility with no retail competition at all and aren't in a municipal or co-op area, state rules require that utility to purchase your excess DRG power at a rate equal to its "avoided cost" — essentially what it would have otherwise paid to generate or buy that same amount of power conventionally.

Incentives worth knowing about

• The federal government offers tax incentives for energy efficiency improvements and renewable energy installations — check current federal rules before you buy, since incentive programs and amounts change.
• Some Texas utilities run their own energy-efficiency programs offering low-cost loans, rebates, or technical advice on renewable installations — worth asking your utility directly.
• Texas offers certain business tax incentives for solar and wind: franchise tax deductions or exemptions for businesses that use, manufacture, or install qualifying systems.
• A property tax exemption is available for the added value a solar, wind, biomass, or anaerobic digestion system contributes to a property.

Quick checklist before you install anything

• Are you in a deregulated area, a municipal/co-op area, or a regulated area with no competition? That determines who you're even negotiating with.
• Does your own retail provider buy back excess DRG power, and does it require you to be on a specific plan to do so?
• Do you have a signed interconnection agreement with your TDU (or your municipal/co-op utility) before installation — not after?
• Have you checked current federal, state, and utility-level incentives, since these change over time and aren't automatically applied?

Source: Public Utility Commission of Texas, Selling Renewable Power. Learn more directly from the PUCT at puc.texas.gov.