The U.S. Energy Information Administration (EIA) forecasts that electricity generated from utility-scale solar power in the Electric Reliability Council of Texas (ERCOT) grid is projected to exceed that from coal for the first time on an annual basis in 2026. This significant shift marks a pivotal moment in the state's energy landscape, driven by substantial solar capacity additions and evolving demand patterns.
According to the EIA's latest Short-Term Energy Outlook (STEO), solar generation in ERCOT is expected to reach 78 billion kilowatthours (BkWh) in 2026. In contrast, coal generation is forecast to be 60 BkWh during the same year. This projected increase in solar output is underpinned by a consistent rise in solar capacity, which is instrumental in meeting the rapid growth of electricity demand within Texas. While natural gas is anticipated to remain the primary source of electricity generation in ERCOT, maintaining an average share of 44% between 2021 and 2025, the contributions from solar and coal are undergoing a notable transformation. Solar's share of the generation mix has climbed from 4% to 12% over this period, while coal's share has seen a decline from 19% to 13%.
Texas is positioned to be a major hub for solar energy development in the United States. The EIA anticipates that approximately 40% of the nation's total solar capacity additions in 2026, amounting to 14 BkWh, will be deployed in Texas. This surge in development is exemplified by projects like the Tehuacana Creek 1 Solar and BESS, a combined solar and battery energy storage system expected to come online this year. With a capacity of 837 megawatts (MW), it is projected to be the largest solar photovoltaic project to commence operations in 2026. Concurrently, there are no new coal power plant constructions planned for ERCOT, according to the EIA's Preliminary Monthly Electric Generator Inventory, which is based on data from Form EIA-860M.
While the annual generation figures for 2026 indicate a crossover point, solar power has already demonstrated its ability to outperform coal on a monthly basis within ERCOT. In March 2025, solar generation reached 4.33 BkWh, surpassing coal's 4.16 BkWh. This trend continued through August of that year. The EIA estimates that solar generation will again exceed coal generation for the first time in March 2026 and is projected to maintain this lead until December, when coal generation is expected to temporarily surpass solar. Looking ahead to 2027, solar generation is forecast to exceed coal generation for all months except January and December.
For the full year 2027, the EIA projects annual solar generation in ERCOT to reach 99 BkWh, compared to 66 BkWh for coal generation. This upward trajectory for solar is further supported by an anticipated 11.8 BkWh of additional solar capacity expected to become operational in 2027, as indicated by the Preliminary Monthly Electric Generator Inventory. The sustained growth in electricity demand within ERCOT is a key factor driving these energy transitions. This rising demand is fueled by significant loads from burgeoning sectors such as cryptocurrency mining, extensive data center construction, increased industrial activities, and the expansion of refining, production, and processing operations related to the oil and gas industry.
This projected shift in ERCOT's generation mix highlights the accelerating integration of renewable energy sources into the U.S. power sector. The substantial investments in solar capacity, coupled with the retirement or declining operational share of coal-fired power plants, are reshaping the energy infrastructure. The increasing demand from new industrial and technological loads further necessitates a robust and adaptable power supply, which renewable energy sources, complemented by energy storage solutions, are increasingly positioned to provide.
