Houston ranks among fastest growing tech hubs amid the pandemic, report finds

growth in HOU

According to a report, Houston has grown its tech workforce more than other major metros over the past year. Joe Daniel Price/Getty Images

When Americans think of tech hubs, Silicon Valley or even Austin may initially come to mind. However, Houston appears to be making a play for tech-hub status.

Citing data from career platform LinkedIn, the Axios news website reports that Houston has seen a healthy influx of tech workers since the start of the pandemic. In fact, Houston ranks second among 14 major U.S. labor markets for the number of relocating software and IT workers between March 2020 and February 2021 compared with the same period a year earlier.

Miami grabs the No. 1 spot for the gain in software and IT workers (up 15.4 percent) between the two periods, with Houston in second place (10.4 percent) and Dallas-Fort Worth in third place (8.6 percent), according to the LinkedIn data.

"Young engineers and recent college graduates see Miami, Houston, and Philadelphia — not San Francisco, New York, or Seattle — as the hot new places to jumpstart a technology or creative economy career," Axios notes.

At the bottom of the barrel sits the San Francisco Bay Area, which suffered a loss of 34.8 percent when comparing the arrival and departure of software and IT workers. Interestingly, Austin experienced a loss of 8 percent in this category.

The shift from traditional tech hub to emerging tech hub is likely to continue as employers and employees alike further embrace remote work. A survey commissioned in April by the nonprofit One America Works found 47% of tech workers had moved during the pandemic. In addition, 3 in 10 tech workers anticipate living somewhere different than they did during the pandemic.

The CompTIA tech trade group says the Houston metro area is home to 243,908 tech workers. The Houston area's tech workforce grew 12.3 percent from 2010 to 2019, according to the group.

"Houston has been a center for world-changing innovations in energy, life sciences and aerospace for over a century. With science and engineering breakthroughs ingrained in the fabric of Houston's economy, the region has become a thriving hub of digital technology talent and companies thanks to our access to customers and expertise," says a report released in March by the Greater Houston Partnership.

One employer taking advantage of that talent is Bill.com. In 2019, the digital payments company opened a Houston outpost — the company's first office outside Silicon Valley.

"Though the city's technology industry is still developing, it offers a breath of fresh air compared to overcrowded late-stage tech markets like Austin and Denver. Ultimately, the breadth and depth of Houston's talent pool and the neighboring educational pipelines made it an ideal location for a second home," Vinay Pai, senior vice president of engineering at Palo Alto, California-based Bill.com and a Rice University graduate, wrote in April 2020 on LinkedIn.
Houston is a good place for creators of digital content, such as podcasters, bloggers, writers, and strategists. Photo by Laurence Dutton/Getty Images

Houston named national hot spot for this tech career, says report

DIGITAL DOMINANCE

The Greater Houston area ranks as one of the hot spots in the country for an in-demand area of tech expertise.

A new report from career website LinkedIn looks at an array of career categories exhibiting the highest year-over-year growth rates in hiring (based on the period from last April to October).

The report pinpoints Houston as one of the hottest U.S. markets for creators of digital content, such as podcasters, bloggers, writers, and strategists. For those looking to transition, the majority of these digital content creators have a bachelor of arts degree, while some 25 percent have a masters, the report notes. Top skills for these positions include editing, writing, public speaking.

Meanwhile, DFW is listed as a "top region" for UX specialists, including UX consultants, designers, and researchers along with the San Francisco Bay area and Greater Chicago area. (What, exactly, is UX? While the field and job can have many facets, one industry site puts it this succinctly: "UX design is the process of designing (digital or physical) products that are useful, easy to use, and delightful to interact with.")

The Austin area ranks as one of the hottest spots in the U.S. for artificial intelligence (AI). The report says jobs like artificial intelligence specialist, machine learning researcher, and machine learning engineer are in particularly high demand in the Austin area, as well as Denver and San Francisco Bay.

In 2019, the tech sector in Texas wielded an economic impact of $141.7 billion and employed more than 1 million people (including AI engineers, UX designers, and digital content creators), according to CompTIA, a trade association for the IT industry.

"Technology powered job growth and economic gains in the past decade in Texas and across the country while delivering countless benefits in how we work, communicate, create, and share," Todd Thibodeaux, president and CEO of CompTIA, said in a 2020 release.

U.S. News & World Report ranks the University of Texas at Austin among the country's top five schools for undergraduate students studying AI, an arm of computer science that simulates human intelligence.

Globally, AI is a fast-growing specialty among employers. A 2020 report from the World Economic Forum identified AI and machine learning positions as the No. 1 emerging category of jobs. Ninety-three percent of U.S. companies surveyed by the organization indicated they had adopted AI technology.

In 2019, job website Indeed reported that average salaries for the highest-paid AI jobs in the U.S. ranged from $109,314 to $142,859.

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This article originally ran on CultureMap.

Houston's tech workforce makes double the average salary — but when it comes to job growth, the city needs improvement, according to a new report. Photo via Pexels

Report: Here's how Houston ranks when it comes to tech salaries and job growth

by the numbers

It truly pays to work in the tech sector in the Houston metro area.

A report published January 11 by Austin-based tech company Spanning Cloud Apps LLC shows workers in the Houston area can more than double their pay when they hold down a tech job. In fact, Houston ranks fifth among the country's largest metro areas for the pay advantage in tech occupations versus all occupations.

According to the report, the median annual pay for a Houston-area tech job stood at $91,190 in 2019. By comparison, the median annual pay for all occupations sat at $40,570. That puts the area's median tech pay 124.8 percent higher than the median pay for all occupations, giving Houston a fifth-place ranking in that category.

At 124.8 percent, Houston is sandwiched between fourth-place Dallas-Fort Worth (127 percent) and sixth-place San Antonio (124.7 percent) in terms of the pay premium offered by tech jobs. At No. 27 is Austin, with a 106.1 percent pay premium for tech jobs.

As for median tech pay, DFW ($91,760) claims the No. 12 spot among large metro areas. Meanwhile, Houston is in 15th place ($91,190), Austin is in 24th place ($85,640), and San Antonio is in 30th place ($81,870).

The report identifies 84,040 tech workers in the Houston area. In that regard, Houston ranks 13th among large metro areas, with DFW at No. 5 (158,490), Austin at No. 18 (66,800), and San Antonio at No. 35 (28,200).

While Houston earns a high ranking in the Spanning report for the pay gap between tech jobs and all jobs, it's toward the bottom of the pile when it comes to the share of tech jobs, the report indicates. Among large metro areas, Houston ranks 41st for the share of computer and math occupations in the workforce, 2.8 percent.

San Jose, California, takes the No. 1 spot in that category, with 12.7 percent of employees working in computer and math occupations. Austin ranks sixth (6.2 percent), DFW holds down the No. 13 spot (4.3 percent), and San Antonio comes in at No. 42 (2.7 percent).

Spanning based its report on data collected by the U.S. Bureau of Labor Statistics.

In February 2020, the Greater Houston Partnership indicated the region was home to about 150,000 tech workers, far above the number tallied in the Spanning report. The partnership says the region boasts the 12th largest tech sector in the U.S., generating an annual economic impact of $28.1 billion. Among the country's 20 largest metro areas, Houston ranks first for the share of tech workers at non-tech employers.

From August to September, Houston saw an 11 percent rise in postings for tech jobs, according to a third-quarter report from tech career hub Dice. That was one of the highest growth rates among the country's largest metro areas.

"As the home of NASA's human space program and headquarters to the global energy industry, Houston has long been known for its engineering prowess," the Greater Houston Partnership says. "Although most of Houston's technology talent is embedded in some of the area's largest industries such as energy and health care, subsectors such as software development, programming, and database management are also growing."

In the tech sector, Houston is bound to benefit from Hewlett Packard Enterprise Co. (HPE) shifting its headquarters from Silicon Valley to its campus under construction in Spring. The company praises Houston as "an attractive market for us to recruit and retain talent, and a great place to do business."

HPE already employs about 2,600 people in the Houston area. The move of its headquarters to Spring could mean the addition of hundreds of local jobs in the coming years.

"HPE's headquarters relocation is a signature moment for Houston, accelerating the momentum that has been building for the last few years as we position Houston as a leading digital tech hub," Bob Harvey, president and CEO of the Greater Houston Partnership, said in December.
From new tech jobs in Houston to an entrepreneurship minor at Rice University, here are some short stories in Houston innovation. Shobeir Ansari/Getty Images

Rice creates entrepreneurship minor, Houston tech jobs grow, and more innovation news

Short stories

While much of the city's news — along with the rest of the country — has been focused on COVID-19, headlines are starting to resemble some sense of normalcy again.

For this roundup of short stories within Houston innovation, there's a mix of news items pertaining to the coronavirus, as well as news items outside of the pandemic — from a new minor program at Rice University to Baylor College of Medicine testing for a COVID treatment.

Rice University introduces entrepreneurship minor

Rice University plans to offer undergraduate students an opportunity to minor in entrepreneurship. Courtesy of Rice University

Three of Rice University's programs — the Liu Idea Lab for Innovation and Entrepreneurship, Jones Graduate School of Business, and Brown School of Engineering — are teaming up to provide undergraduate students an opportunity to minor in entrepreneurship.

"Entrepreneurship and the creation of new businesses and industries are critical to Houston and Texas' future prosperity and quality of life," says Yael Hochberg, Rice finance professor who leads Lilie, in a release. "Rice students continuously seek to lead change and build organizations that can have real impact on our world. In today's new and uncertain world, the skills and frameworks taught in the new minor are particularly important."

According to a news release, the minor's curriculum will provide students with professional skills within entrepreneurship, such as problem solving, understanding customers and staff, communication, and more. The program will be housed in Lilie, which features a coworking space, graduate and undergraduate entrepreneurship courses, the annual H. Albert Napier Rice Launch Challenge, and other courses.

Houston named No. 12 for tech jobs

Houston's tech jobs are growing — just not at an impressive rate, according to a new report. Christina Morillo/Pexels

CompTIA has released its Cyberstates 2020 report that identifies Houston as No. 12 in the country for tech jobs. However, the Bayou City was ranked No. 38 for job percent growth. Austin and Dallas appear in the top 10 of each of the Cybercities rankings.

According to the report, Houston has a net total of 235,802 tech jobs, an increase of 826 jobs between 2018 and 2019. This figure means a growth of 25,904 jobs between 2019 and 2010. The full report is available online.

While Houston misses the top 10 metros, Texas ranks No. 2 for net tech employment and net tech employment growth. The Lone Star State came in at No. 4 for projected percent change in the next decade. The state was also recognized as No. 2 for number of tech businesses.

Baylor College of Medicine tests existing drug for COVID-19 cure

A Houston institution is looking into an existing vaccine for coronavirus treatment. Andriy Onufriyenko/Getty Images

Baylor College of Medicine researchers — along with colleagues at four other institutions — are testing to see if the bacille Calmette-Guerin vaccine, known as BCG, can work against COVID-19.

"Epidemiological studies show that if you're BCG vaccinated, you have a decreased rate of other infections," says Dr. Andrew DiNardo, assistant professor of medicine – infectious diseases at Baylor, in a news release.

The vaccine has been found to help protect against yellow fever and influenza, and, according to DiNardo, the vaccine could show 30 to 50 percent improvement in immune response in patients with the coronavirus. The team is currently looking for subjects to participate in a clinical trial to test the vaccine.

While research is preliminary, the theory is that BCG changes the way the body responds to a pathogen, according to the release.

"Think of DNA like a ball of yarn," DiNardo explains in the release. "Some pieces of the ball of yarn are open and able to be expressed. Other pieces are wrapped up tight and hidden away, and those genes are repressed. It's a normal way for cells to turn certain genes on and off. BCG opens up certain parts of this ball of yarn and allows the immune system to act quicker."

Plug and Play announces physical space in Houston

Plug and Play Tech Center's local team will work out of the Ion. Courtesy of Rice University

Since entering the Houston market last year, Silicon Valley's Plug and Play Tech Center has hosted numerous events, named its first cohort, and hired Payal Patel to lead the local operations. However, the local operations still, until recently, lacked a plan for a physical space in town.

"Plug and Play intends to set up its permanent office in Houston in Rice's Ion development," says Patel in a statement. "We have engaged in preliminary discussions with Rice Management Company to secure office space for the building's expected Q1 2021 opening."

Until then, says Patel, who is director of corporate partnerships for Plug and Play in Houston, the Plug and Play team will have its base at Station Houston, which recently merged with Austin-based Capital Factory. At present, the local team is hiring to build up its team and has five open jobs on HTX Talent, a job portal for Houston tech.

UH professor named a Guggenheim fellow

A University of Houston professor has been honored with a prestigious award. Photo courtesy of University of Houston

A University of Houston mechanical engineer has been selected for a Guggenheim Fellowship. Pradeep Sharma is the only recipient in the engineering category.

The M.D. Anderson Chair Professor of mechanical engineering and chairman of the department, Sharma uses mathematics and technology to breakdown physical phenomena across a number of disciplines.

The Guggeinheim Foundation has funded more than $375 million in fellowships to over 18,000 individuals since its inception in 1925. This year, the organization selected 173 individuals.

"It's exceptionally encouraging to be able to share such positive news at this terribly challenging time," Sharma says in a news release from UH. "The artists, writers, scholars and scientific researchers supported by the fellowship will help us understand and learn from what we are enduring individually and collectively."

Houston health system to participate in coronavirus plasma study

HCA Houston Healthcare is participating in a plasma treatment program. Getty Images

HCA Healthcare Gulf Coast Division has announced that it will be participating in a national study to see if plasma from recovered COVID-19 patients can help current COVID patients in severe conditions.

"We are proud to take part in this important study. We are asking for the help of our community to spread awareness about plasma donation for patients facing COVID-19 not only in Houston, South Texas and Corpus Christi, but also around the world," says Mujtaba Ali-Khan, chief medical officer at HCA Healthcare Gulf Coast Division, in a news release.

Per the study, the following HCA Healthcare Gulf Coast Division Hospitals will be participating:

  • HCA Houston Healthcare Clear Lake
  • HCA Houston Healthcare Conroe
  • HCA Houston Healthcare Kingwood
  • HCA Houston Healthcare Southeast
  • HCA Houston Healthcare West
  • HCA Houston Healthcare Tomball
  • HCA Houston Healthcare North Cypress
  • HCA Houston Healthcare Northwest
  • HCA Houston Healthcare Mainland
  • HCA Houston Healthcare Medical Center
  • Corpus Christi Medical Center
  • Rio Grande Regional Hospital
  • Valley Regional Medical Center

"This trial is just the first step, but hopefully it will help us determine if plasma transfusions can be a treatment for critically ill patients with COVID-19," says Carlos Araujo-Preza, MD, critical care medical director at HCA Houston Healthcare Tomball, in the release.

Dr. Araujo-Preza safely discharged his first plasma patient last week. The patient is recovering from home following their treatment.

The hospital system is looking for eligible volunteers to donate plasma via the American Red Cross to help treat current patients.

Early stage energy venture firm calls for startups

Industrial software

BBL Ventures is looking for energy companies to pitch. Getty Images

Houston-based BBL Ventures, which looks to connect tech startups to industrial and energy corporations, is seeking energy tech startups to pitch.

"Digital transformation, automation, emerging technologies and sustainability have never been more important to these industries than in this challenging macro environment," says Patrick Lewis, founding managing partner of BBL Ventures, in an email. "We are launching a 6-week challenge campaign to find BEST in class solutions to BIG pain points in the energy and industrial sectors."

In the email, Lewis lists over a dozen challenges or pain points from the organization's corporate partners. The goal would be to find startups with to solutions to any of these identified pain points. Winners of the pitch competition are eligible for POCs, pilots, and funding.

For more information and to submit a pitch, visit BBL's website. BBL is also introducing the program with a virtual kick-off panel on May 21 at 2 pm. Registration is available online.

It's crucial for Houston to prepare the next generation's workforce to succeed and fill jobs with capable talent. Educational First Steps/Facebook

Preparing Houston's tech workforce starts in school, says expert

Guest column

Recent studies have shown that nearly half of students enter college with an undecided major and as many as 70 percent of students change their major at least once during their four-year program, and it is predicted that by 2030, there will be a deficit of 7.9 million tech workers alone.

In order to better prepare the future workforce, schools are encouraging career exploration through hands-on experience. The Village School has created educational partnerships throughout Houston to offer students options to find their interests and better prepare them for postsecondary success.

Educational partnerships

Students are prone to changing their majors because often they will go into a field with an impractical idea of what a specific career actually entails. With partnerships between education and industry, Houston is able to better equip students to enter college with a realistic view of what to expect in their major.

While career-focused partnerships are beneficial for students, they also play a huge role in recruiting valuable skilled talent for years to come. A good impression, good mentors and great experience goes a long way when students start job searching.

Tuning into Houston's workforce

High school is the time for students to explore different career options. When students are placed in an internship program as early as the high school level, they are able to see exactly what the day to day looks like while building a foundation of professional development as they start to think about their future. It's important for students to have a realistic vision of what a career looks like.

There are numerous businesses in Houston that are working with high school students to help them gain experience.

For example, a few of the businesses that have partnerships with The Village School include Houston Methodist Hospital, Pimcore, M.D. Anderson Cancer Center, and Cisco. Students are able to gain experience in a variety of ways including:

  • Working alongside surgical technicians and experience open-heart surgery and quarantined situations
  • Learning from cancer researchers who study nicotine addiction in children and the effects on brain development
  • Leveraging data analytics to develop software helping internal team members organize calendars at a leading SAP company

All students finished their internship with a better understanding of the workforce and the skills necessary to perform in a professional environment.

Finding opportunities for everyone

If students don't attend a high school that offers internships there are still opportunities to gain experience. Many businesses are open to job shadowing or having students volunteer a few hours a week to gain experience over the summer months. The opportunity for experience is out there and available and these opportunities will continue to grow and become more accessible for all students. Houston families and businesses must work together to ensure students know their options before entering college.

Educational partnerships benefit both students and the community. It's crucial for Houston to prepare the next generation's workforce to succeed and fill jobs with capable talent. Students are able to see that while they may not think they are interested in a specific field there are opportunities within the field that match their strengths and interests.

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TeKedra Pierre is the internship coordinator at The Village School.
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Houston energy startups claim big wins, space health fellows named, and more innovation news

Short stories

What's the latest in news for the Houston innovation ecosystem? So glad you asked. Here's some local startup and tech news you might have missed.

In this roundup of short stories within Houston innovation, an energy transition startup snagged $100,000 in a recent competition, four space health researchers were named to a Houston program, a Houston tech startup was tapped by Google for its recent cohort, and more.

Cemvita Factory wins $100,000 in clean energy competition

Cemvita Factory has secured wins in two recent startup competitions. Photo courtesy of Cemvita

A Houston company has been named the the $100,000 cash winner of an inaugural competition.

The GS Beyond Energy Innovation Challenge from Cleantech.org named Cemvita Factory as the big winner — out of six finalists. Another Houston company, Amperon Inc. , came in second place, followed by Skycool Systems in third place. The third Houston startup named to the finals, Veloce Energy, was named the crowd's favorite. The three Houston finalists were announced in June.

"Our top three startups face many challenges on the path to accelerating the energy transition, and we are honored to be a part of their journey. Startuplandia is a rough and tumble world, and it was a very close competition. Congrats to Moji Karimi and the Cemvita Factory team. Can't wait to see what you do next," says Neal Dikeman, chairman of Cleantech.org and a partner at one of the prize sponsors, Energy Transition Ventures, in a news release. "And a huge thanks to our accelerator and incubator partners. We look forward to working with everyone again in the future."

Cemvita Factory was also named the winner of The Ion's Houston Startup Showcase a few weeks ago.

Google taps Houston startup for latest cohort

Google has named DOSS to its Black Founders Accelerator. Photo via Pexels

A Houston startup has made it into the Google for Startups Accelerator: Black Founders cohort. DOSS, a digital, voice-activated real estate tool, was selected for the second cohort of the accelerator.

Bobby Bryant leads the company as founder and CEO. DOSS is joined by 10 other startups — including two other Texas companies, Dallas-based Zirtue and Fêtefully.

"Being a digital real estate search and transactional marketplace, this is a perfect opportunity for DOSS to have direct access to Google Engineers and Developers. This is a startup founder's dream to work with Google," Bryant writes in a LinkedIn post.

The program concludes with a showcase on Thursday, October 21 from 11:30 am to 1:00 pm.

Space health organization selects four fellows

These four fellows will continue their space health research with the support of TRISH. Photo via Pexels

Houston-based Translational Research Institute for Space Health, known as TRISH, at Baylor College of Medicine has named four scientists to receive postdoctoral fellowship awards to further their career in space health. Each fellow will work on a two-year project that "addresses challenges to astronaut health during deep space exploration missions," according to a news release. The fellows also become part of the TRISH Academy of Bioastronautics, a forum for postdoctoral researchers working on TRISH research projects.

"The space industry needs a strong pool of highly-trained scientists focused on human health to return us to the moon," says Zélia Worman, TRISH scientific program manager and lead for postdoctoral career development, in the release. "TRISH has selected four postdoctoral fellows who are ready for the challenge. We are proud to welcome these outstanding scientists to our Academy of Bioastronautics and work with them to launch their career in space health and reach for the Moon and Mars safely."

The postdoctoral fellows are:

  • Kaylin Didier of the University of Wisconsin, Madison — focused on ionizing radiation and immune responses: exploring sex differences
  • James Jahng of Stanford University, California — focused on countermeasure development against myocardial mitochondrial stress by space radiation exposure
  • Heather McGregor of the University of Florida, Gainesville — focused on investigating planta somatosensory noise as a countermeasure for balance and locomotion impairments in simulated lunar and Martian gravity
  • Mallika Sarma of Johns Hopkins University, Baltimore, Maryland — focused on stress response and neurovestibular compensation and the potential ameliorative effects of team support

Houston energy consortium names winners in startup competition

Energy tech founders pitched at the Society of Petroleum Engineers' summit. Photo via Getty Images

The Innovation and Entrepreneurship Summit from the Society of Petroleum Engineers-Gulf Coast Section concluded with a startup pitch event earlier this month. Three startups were recognized at the Shark Tank-style competition.

  • The judges selected Houston-based SaaS startup InerG as the winner.
  • The People's Choice winner was New Jersey-based Anax Power.
  • North Carolina-based Revolution Turbine was the runner-up, according to the judges, as well as received honorable mention from the People's Choice portion of the competition.
The judges of the event — or the "sharks" — included Plug and Play Director Payal Patel, Montrose Lane Managing Partner Ryan Gurney, CSL Ventures Vice President Abhinav Jain, and SCF Ventures Managing Director Hossam Eldadawy.

Capital Factory is calling for all female founders

Attention female founders — Capital Factory has a competition you need to know about. Photo via Getty Images

Austin-based Capital Factory's Texas Fund, in partnership with Beam Angel Network, Seven Seven Six Fund, and Golden Seeds (Houston), has announced a $100,000 Investment Challenge for its 4th Annual Women In Tech Summit on October 4. Capital Factory is looking for five technology startup finalists to pitch to a panel of advisors and judges made up of successful investors, entrepreneurs, and industry leaders. The prize on the line? A $100,000 investment and membership into Capital Factory.

Any software, hardware, or CPG startup in Texas with a female founder or co-founder can apply to participate. The finalists will all be fast tracked into the Capital Factory portfolio, access to the Capital Factory Mentor network and coworking space, and up to $250,000 in potential total hosting credits from AWS, Google Cloud, Microsoft Azure and other major hosting providers. Capital Factory will receive: 1 percent common stock grant as advisor equity (separate from the investment) and the right to invest up to $250,000 in the next round of funding.

One winner will receive a $100,000 cash investment on a SAFE or Convertible Note using Capital Factory's term sheet and your most recent funding valuation, or a qualified term sheet provided by the company. The deadline is September 12. Submit your application

Deloitte IDs 3 tech trends that deserve a closer look in 2021

2021 Outlook

While cloud computing and artificial intelligence continue to dominate the technology industry, edge computing is also making headlines.

Deloitte's vice chairman and US technology sector leader, Paul Silverglate, shares his perspectives on the advantages of processing data locally and how partnerships will play a key role in accelerating growth in the technology industry in 2021.

Right now, technology organizations should consider three key strategic opportunities, both to recover from the COVID-19 crisis and boldly position themselves to thrive in the future:

  1. Redoubling digital transformation efforts, with an emphasis on improving cloud infrastructure, data and analytics capabilities, cybersecurity, and business model transformation
  2. Reorienting and reskilling the workforce to optimize remote work capabilities and take full advantage of advanced technologies such as artificial intelligence (AI)
  3. Reexamining where and how manufacturing happens, with a focus on improving transparency, flexibility, and resiliency

Continue reading the full report on Deloitte's website to learn more about the tech industry trends, key actions to take, and critical questions to ask.

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This publication contains general information only and Deloitte is not, by means of this publication, rendering accounting, business, financial, investment, legal, tax, or other professional advice or services. This publication is not a substitute for such professional advice or services, nor should it be used as a basis for any decision or action that may affect your business. Before making any decision or taking any action that may affect your business, you should consult a qualified professional advisor. Deloitte shall not be responsible for any loss sustained by any person who relies on this publication.

About Deloitte
Deloitte refers to one or more of Deloitte Touche Tohmatsu Limited, a UK private company limited by guarantee ("DTTL"), its network of member firms, and their related entities. DTTL and each of its member firms are legally separate and independent entities. DTTL (also referred to as "Deloitte Global") does not provide services to clients. In the United States, Deloitte refers to one or more of the US member firms of DTTL, their related entities that operate using the "Deloitte" name in the United States and their respective affiliates. Certain services may not be available to attest clients under the rules and regulations of public accounting. Please see www.deloitte.com/about to learn more about our global network of member firms. Copyright ©2020 Deloitte Development LLC. All rights reserved.

Expert: Solar energy is a necessary solution to summer power grid insecurity in Texas

guest column

You know the old adage: "If you don't like the weather here, wait five minutes." Texas weather is not just unpredictable; it can be downright bipolar. I don't need to remind you of the knockout punch Old Man Winter delivered last February, even to parts of the state where hard freezes are few and a "snow event" usually amounts to a dusting. It will be a long time before Texans forget spending a week without power in single-digit temperatures — huddled together in their homes under mountains of blankets — with no heat, no way to bathe or cook, and no escape.

The massive power outages of Valentine's Day week spurred public outrage and a full-throated demand that state leaders take decisive steps to make Texas' electric grid sustainable. The legislature was only a month into its 140-day regular session at the time, but still failed to do anything substantial to fix the grid before adjourning May 31.

Now — well ahead of the hottest days of summer — Texans are wondering why the Electric Reliability Council of Texas (ERCOT) is already asking them to set their thermostats at 78 degrees, turn off lights, avoid using their ovens or doing laundry in the evenings, and otherwise conserve energy. It was ERCOT's second such call since April. Some local energy companies have recommended setting thermostats even higher, and local rolling blackouts have continued in Dallas, Houston, and elsewhere in the state throughout the months of June and July. That may be fine for some people during Texas' scorching summer heat, but for others, it is untenable. For the elderly or infirmed, it could be deadly.

Experts have warned the grid is unreliable, the system is strained, and homeowners and businesses hover at near-constant risk for blackouts, unless the state does more to weatherize the grid, bring more generators back online, and provide more emergency backup power. Meanwhile, when temperatures hit triple digits and stay there for days, the blackout risks will skyrocket.

But there is one obvious solution to grid instability that will enable Texans to keep their homes and businesses comfortably cool during the hot summer months ahead, without setting their thermostats higher or timing their activities to government guidelines. Widespread distributed generation of solar energy, instead of the current emphasis on remotely located utility-scale solar, would provide a highly effective, long-term solution to decreasing strain on the ERCOT power grid.

That means dramatically increasing the number of solar installations on residential and commercial properties statewide. Consider the distance and infrastructure required to bring power from a West Texas solar farm to the state's big cities. That's not only a costly undertaking, it exposes the system to many vulnerabilities along the way. It makes more sense to install solar panels on-site, behind the meter, and pair them with storage for backup power.

The logic is simple: Increasing the number of homes and businesses with on-site solar power would decrease the burden on the grid and help insulate it against failure. Further, by installing home batteries such as the Tesla Powerwall for backup power, residents can control their own power supply and ensure its reliability, even during extreme weather events—summer or winter.

These technologies are cost-efficient and readily available today. A few months ago, Congress extended the 26 percent federal solar investment tax credit (ITC) — which also applies to batteries paired with solar — through 2021 (dropping to 22 percent in 2022), making the move to solar and backup power even more sensible.

State leaders have tried to lay the blame for last winter's power outages on renewable energy. But failures of natural gas power plants, not renewable generators, caused the grid failures that led to those deadly blackouts.

On July 6, months after declaring "everything that needed to be done was done to fix the power grid in Texas," Governor Abbott ordered the PUC to take steps to overhaul the state's electric system. But the solutions he's offering—like constructing new coal, gas, and nuclear power plants and building their transmission lines faster—are giveaways to the fossil fuel industry and will take a long time to complete. Texas needs reliable power NOW.

Meanwhile, state officials are increasingly emphasizing conserving power during extreme temperatures, which suggests they don't even believe their assurances that no more blackouts lie ahead. On-site solar power is the obvious solution, both today and for the long-term health of our rapidly growing state and rapidly warming planet.

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Bret Biggart is CEO of Austin-based Freedom Solar, the leading turnkey solar energy installer in Texas, providing high-quality, cost-effective, reliable solar solutions for the residential and commercial markets.

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