Writer: Andrea Teran
2 min read January 2024 — Traditionally considered the heart of the global oil and gas industry, Houston is now pioneering a transformative shift towards renewable energy and sustainability, driven by diversified investments and a commitment to embracing all aspects of the energy industry.
“In Houston, energy and alternative energy are booming. Private equity investments are flowing into hydrogen, carbon capture, and solar energy,” Janette Marx, CEO of Airswift, told Invest:. “We have Greentown Labs, an incubator for alternative energies, and it’s fantastic. Houston isn’t just about one aspect of energy; it encompasses all aspects, making it the energy capital of the world.”
According to the International Energy Agency (IEA), global investments in clean technologies like wind, solar power, electric vehicles, and batteries are projected to surpass $1.7 trillion this year, overshadowing the just over $1 trillion earmarked for fossil fuels. This marks an unprecedented shift in investment priorities, with clean energy receiving the highest annual funding ever.
Houston’s commitment to a greener future is evidenced by a significant influx of private market investments. The Greater Houston Partnership (GHP) reports that in 2022, the city’s energy transition sector secured $6.1 billion, reflecting a substantial 61.9% increase from the previous year. This growth trajectory, particularly prominent since 2020, underscores the region’s burgeoning interest in sustainable energy solutions.
For example, Calpine Corporation’s project in Baytown is pioneering carbon capture and storage (CCS) technology. Leveraging Shell’s CANSOLV solvent, it aims to capture and store approximately two million metric tons of CO2 annually. This initiative is a significant step towards reducing emissions from power generation and underscores Houston’s commitment to combating climate change.
At Rice University, a $12.5 million investment by Woodside Energy in partnership with the higher ed institution is dedicated to commercializing decarbonization technologies. The accelerator focuses on developing and fast-tracking innovative technologies, such as better batteries, transistors, and other critical materials for energy technologies, contributing significantly to the clean energy sector’s growth.
Major industry player Chevron and its green solutions arm Chevron New Energies has also continued to make strides in the clean energy space, revealing in October 2023 the purchase of a 78% stake in the Advanced Clean Energy Storage (ACES) project in Utah from Houston-based private equity firm Haddington Ventures.
With 550 energy transition companies and incentives from the Inflation Reduction Act, Houston’s existing infrastructure and expertise are pivotal to its transformation into a renewable energy leader. According to Elijah Williams, executive director of the Energy Corridor, the success of the energy sector is an important factor to the overall success of the region.
“Our medical center is the largest in the world and taking on new efforts in life sciences, NASA is working to go back to the moon and the Houston space port is growing, and let’s not forget the Port of Houston,” Williams told Invest:. “The Energy Corridor is a huge part of Houston’s success with a $24.3 billion total economic output and over 119,000 total jobs.”
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