It goes without saying that the past couple of months have been tough on the economy. The energy sector has been especially affected, as oil demand dipped along with global travel. Add to that an oil price war between Russia and Saudi Arabia, which also affected domestic oil prices.
But there is a bright spot in the energy market amid all of the gloom and doom, says Matt Smith, director of commodity research at Clipper Data. He says the market for wind- and solar-generated energy did get “swept up” in the coronavirus chaos, which means some projects have been delayed. But the sector is still growing.
“We have had some glimpses of good news in terms of headlines in the last week,” Smith says.
One example is a new wind farm coming online in West Texas. Sage Draw, which has 120 turbines across Garza and Lynn counties, is part of a so-called Power Purchase Agreement, or PPA, with energy giant Exxon Mobil.
“What they’ve done, essentially, is, over the next 12 years, they’re buying 500 megawatt-hours of capacity for wind and solar power – somewhat ironically – to use to produce oil in the Permian Basin,” Smith says. “They’re aiming to essentially meet 70% of their demands with renewables.”
It’s not just Exxon Mobil; tech corporations, furniture manufactures, restaurant chains and other businesses are looking to use wind- and solar-generated energy.
“We’ve got Google, McDonalds, Wells Fargo, among some of these companies that are committing to buying power from Texas solar plants,” Smith says. “IKEA actually has just purchased 49% stakes in two solar projects – one is in Utah and one is in Texas.”
Written by Alexandra Hart.