Houston has long been known as the Energy Capital of the World and as a headquarters for every traditional energy industry sector, such as oil and gas. A new report says the city and region are also primed to lead the way for the transition to green, renewable energy.
On Oct. 6, the Greater Houston Partnership released the Houston Energy Transition Initiative (HETI), explaining why the city is well positioned as well as the necessary steps it must take to become the energy transition capital of the world.
The report outlines Houston’s advantages
While Houston has decades of leadership in traditional energy markets, the city has seen a 400% increase in new energy venture capital, welcoming more than 60 new climate-tech and low-carbon startups in the last few years. The city has the fastest-growing ecosystem for innovation related to green energy production. HETI outlines several advantages Houston has for this growing industry:
- Established expertise in the energy sector
- A diverse talent pool
- Access to low-cost power
- Pipelines, refineries and other energy infrastructure
- Universities and other academic institutions focused on new energy systems
- Reduced regulations and easier access to permitting
- Established financiers in the energy industry and a robust private equity base
The report states that these qualities and many others can springboard Houston’s energy transition leadership in several areas, including carbon capture, clean hydrogen, renewable fuels and upgrading storage and transmission methods.
There is more work to be done
While Houston is uniquely situated to lead the transition, HETI outlines three steps that financial leaders can take to support these efforts:
- Work with state and local lawmakers for policies that provide incentives for clean energy.
- Explore a new mechanism to finance projects, such as a “low-carbon” bank.
- Promote Houston’s economic opportunities to investors outside Texas.
Perhaps the greatest attribute noted in the report is that both established energy companies and startups see Houston as the best place where low-carbon products can be integrated into the existing energy infrastructure.