< Previous106 TEXAS ECONOMIC DEVELOPMENT GUIDE including a dramatic increase to 50% of European LNG demand beginning in January 2022 after reduction of pipelined natural gas from Russia. In other words, Texas LNG projects don’t just play a role in the U.S. economy. They join with other Gulf Coast LNG operations to serve the needs of the rest of the world too. Nearly all Texas projects continue to move forward, including the three- train Rio Grande LNG Phase 1 project in Brownsville from NextDecade Corp. The project’s $18.4 billion financing is the largest greenfield energy project financing in U.S. history and its construction represents thousands of jobs. The company announced its final investment decision (FID) in July 2023 along with signaling to Bechtel Energy it was time to start construction. It also announced on that day the closure of a joint venture agreement for Phase 1 which included approximately $5.9 billion of financial commitments from Global Infrastructure Partners, GIC, Mubadala Investment Company and TotalEnergies. Two more trains are planned, as well as a carbon capture and sequestration facility. “This project gives TotalEnergies access to competitive LNG thanks to its low production costs,” said Patrick Pouyanné, chairman and CEO of TotalEnergies. “LNG from this first phase will boost TotalEnergies U.S. LNG export capacity to over 15 MTPA [million metric tons per annum] by 2030, and thus our ability to contribute to European gas security, and to provide customers in Asia with an alternative form of energy that is half as emissive as coal.” NextDecade in March 2024 said it anticipates reaching a positive FID for Train 4 in the second half of 2024. Another project also unfolding in Brownsville is Texas LNG, a 4-MTPA facility owned and managed by Glenfarne Energy Transition and being delivered by a joint venture between Technip Energies USA and Samsung Engineering Co., Ltd. As the company continues to sign long-term purchase Linde and bp are developing a carbon capture and storage project to serve the needs of companies along the Texas Gulf Coast industrial corridor near Houston. Photo: Getty Images, courtesy of bpTEXAS ECONOMIC DEVELOPMENT GUIDE 107 agreements with export customers abroad, it continues to move toward an FID in 2024 with plans to ship out its first LNG cargo in 2028. Also in March, the Port Arthur LNG Phase 1 project held an official groundbreaking around one year after the positive FID by Sempra Infrastructure. Work is underway for the overall project’s next phase as well as its own carbon sequestration complex. At total build-out, the Sempra project aims to have a capacity of 26 million MTPA, nearly equivalent to the goal of 27 million MTPA at the NextDecade site. “We each have a part to play to ensure that the transition to a lower- carbon future is well-managed, that affordability and reliability are not sacrificed in the pursuit of sustainability,” said Justin Bird, CEO of Sempra Infrastructure and executive vice president at Sempra. “We can do that by ensuring companies are able to launch timely projects to meet today’s growing energy demand. Port Arthur LNG Phase 1 is uniquely positioned to meet the moment, as it underpins world-class, low-carbon opportunities proximal to the facility, enabling the region to serve as a flagship hub for the energy transition.” Sempra Infrastructure and Bechtel as of March 2024 had hired more than 1,000 construction and office staff since the FID. Bechtel also has more than 100 local vendors for the project, totaling more than $160 million in local contracts. Texas Leads the Nation The Solar Energy Industries Association and Wood Mackenzie in March 2024 announced the U.S. solar industry added a “record-shattering 32.4 gigawatts (GW)” of new electric generating capacity in 2023, a 37% increase from the previous record set in 2021 and a 51% increase from 2022. The top state for solar installations? Texas with 6.5 GW, “eclipsing California for the second time in the last three years,” said the SEIA. According to the U.S. Department of Energy, as of June 2023, Texas had the most renewable electricity generation in the nation at over 55 gigawatts (GW) of solar, wind and storage capacity, with 42 more GW scheduled to come online in the next three years (including nearly 1.3 GW in the Austin area). Moreoever, the DOE reports having tracked 11 GW of solar module manufacturing investment in Texas since 2020. The state’s portfolio of renewables and other energy projects continues to grow, including the 187-MW Peacock Solar project from bp and JV partner Lightsource bp located 10 miles north of Corpus Christi in San Patricio County. The portfolio also includes the Noria Hondo project on 2,000 acres of land owned by King Ranch in Kleberg County. That’s where the ranch and Talen Energy will pursue utility-scale development of a 145-MW solar facility and 75-MW battery storage facility. King Ranch is also the site of the planned South Texas Direct Air Capture (DAC) Hub. To be operated by Occidental company 1PointFive, the hub is expected to include the world’s first DAC plant designed to remove up to 1 million metric tons of CO2 per year. A carbon capture and storage (CCS) project first announced by bp and Linde in May 2022 continues to move forward along the Texas Gulf Coast industrial corridor in Greater Houston. “The overall development, expected to be operational as early as 2026, will also enable capture and storage of CO2 from other large industrial facilities in the region,” the companies said in 2022, “and could ultimately store up to 15 million metric tons per year across multiple onshore geologic storage sites — the equivalent of taking approximately 3 million cars off the road each year.” Energy Capital Leads in Energy Efficiency Too In March 2024 the U.S. Environmental Protection Agency EPA recognized 103 U.S. manufacturing plants that earned the agency’s ENERGY STAR certification in 2023, designated for plants in the top 25% of energy efficiency in their sector. a select club of more than 270 industrial plants that have earned ENERGY STAR stamp since 2006 across 21 manufacturing sectors ranging from cement and steel to glass and commercial bakeries. The top state for 2023 certifications? Texas with 11, including three from Flowers Baking Co. Texas is No. 2 in the nation in overall ENERGY STAR certifications since the program launched in 1999, with 929, far ahead of No. 3 Florida. And two Texas metro areas make the national top 10 for ENERGY STAR certifications: Austin with 175 projects is tied with Denver at No. 6, just ahead of Houston with 161. 108 TEXAS ECONOMIC DEVELOPMENT GUIDEW hen it comes to supporting economic development in Texas, CenterPoint Energy qualifies as the jack of all trades. A diversified, $40-billion energy company headquartered in Houston, CenterPoint serves more than 7 million customers in six states with electric and natural gas energy and employs around 9,000 people. In one form or another, this company has been doing business and providing power for more than 150 years. by RON STARNER TEXAS ECONOMIC DEVELOPMENT GUIDE 109 PROFILE: CENTERPOINT ENERGY CenterPoint Energy: A $40 Billion Jack Of All Trades110 TEXAS ECONOMIC DEVELOPMENT GUIDE With roughly 3,700 miles of transmission lines and almost 50,000 miles of distribution lines, CenterPoint delivers electricity to more than 2.4 million customers over 5,000 square miles in South Texas. Where the firm truly stands out, however, is in the highly competitive field of economic development. The company’s goal is to drive economic growth in its service territories. In Texas, that entails a huge swath of the state around Greater Houston, from the Gulf Coast to inland counties as far north as Washington, Grimes and Montgomery. Odell Winn II leads the CenterPoint economic development team, which also includes Billy Hill III and Cam Yearty. All three of them work year-round to help businesses find the sites and power they need to grow. Whether it’s connecting employers to valuable workforce training programs or introducing them to state and local leaders that can provide incentives, CenterPoint stands ready to assist firms through the myriad of challenges posed by site selection and expansion. Recently, CenterPoint teamed up with local leaders in Houston to officially open a 150,000-square- foot training center on the southwest side of town. The Hiram O. Clarke Training Center opened for business on Nov. 20, 2023. It has also teamed up with Ford Motor Company to promote the adoption of electric vehicles. In 2010, CenterPoint and Ford formed a partnership to encourage the use of EVs. Formerly known as Reliant Energy, CenterPoint Energy merged with Vectren Corporation in 2018 with CenterPoint emerging as the head company. David J. Lesar has served as president and CEO of the firm since 2020. MEMBERS OF THE ECONOMIC DEVELOPMENT TEAM AT CENTERPOINT ENERGY CAN BE REACHED AT ANY TIME AT ECODEVRFI@CENTERPOINTENERGY.COM. Photos: Getty Images112 TEXAS ECONOMIC DEVELOPMENT GUIDE G iven its sheer size, it should come as no surprise that Texas consistently ranks as the nation’s No. 2 producer of manufactured goods. For more than two decades, the Lone Star State has led the nation in manufacturing exports, its total having hit a staggering $444.6 billion in 2023. But what truly stands out about Texas is the breadth — and the increasing depth — of what it produces. Long a leader in sectors that include industrial machinery, chemicals, fabricated metals and food processing, Texas has vaulted into a leadership position among the industries that fuel today’s global economy, namely computers, computer chips, electric vehicles and EV batteries, solar panels, aircraft and rockets. Texas leads the industries that matter most. by GARY DAUGHTERS INTO the FUTURE ADVANCED MANUFACTURING Tesla’s Gigafactory Texas Photo courtesy of TeslaPerhaps nothing speaks to this as dramatically as how Elon Musk has embedded his leading-edge automotive and space enterprises within Texas’s business-friendly confines, citing such factors as lower taxes, affordable housing and ease of building. Having moved Tesla headquarters to Austin in 2021 from Palo Alto, California, Musk re- incorporated SpaceX from Delaware to Texas in February 2024. With a SpaceX launch facility, launch control center, tracking facility and production hub already established in and around Brownsville, the company recently launched construction of a $100 million office there to be completed in 2025. Musk, who has famously declared Austin to be “the biggest boomtown that America has seen in 50 years,” now employs more than 20,000 people at his Gigafactory Texas, which made inaugural deliveries of the Tesla Cybertruck in November. Giga Texas is the country’s second largest factory by size, and now produces some 5,000 Model Y electric vehicles per week. Tesla also chose Texas for a refining facility that’s to produce battery-grade lithium for the company’s expanding product line. Construction of the plant near Corpus Christi began in May of 2023 and is to create nearly 1,000 jobs, with employment at the completed facility expected to top 250. Tesla says the project represents an investment of more than $1 billion. Semiconductors: Building Upon a Legacy As the state where the integrated circuit was invented, Texas is aggressively and successfully courting the semiconductor TEXAS ECONOMIC DEVELOPMENT GUIDE 113114 TEXAS ECONOMIC DEVELOPMENT GUIDE industry, which increasingly underpins products from phones and laptops to cars and all manner of home appliances. Texas currently boasts more than 50 microchip facilities that employ close to 50,000 workers, the most of any state other than California. In June 2023, Governor Greg Abbott signed the Texas CHIPS Act to further cement the state’s leadership position. The legislation created a $698 million Texas Semiconductor Innovation Fund to support semiconductor research, design and manufacturing projects. It also appropriates more than $660 million for the creation of advanced research and development centers at the University of Texas at Austin and Texas A&M University. “Texas,” said Abbott at a signing ceremony, “is the birthplace of the chip that changed the world — and where the future of America’s semiconductor industry is already building.” Over the past four years, Texas has attracted more than 60 semiconductor- related projects and expansions. Of those, 22 landed in the Austin- Round Rock region. In nearby Taylor, Samsung is nearing completion of a $17 billion chip plant announced in late 2021 during the same blockbuster week in which Dallas-based Texas Instruments announced plans for a $30 billion wafer fab in the town of Sherman. The investments continue to roll in. With orders from the automotive industry surging, X-FAB Texas, an operating unit of Belgium’s X-FAB, announced plans in 2023 to pump $200 million into its silicon carbide wafer plant in Lubbock, in operation since 1999. X-FAB plans to bolster its 500-person workforce by 250 jobs over the next five years. Lubbock’s South Plains College recently opened a new technical training center, a potential pipeline for X-FAB, which relies on Texas Tech for much of its engineering talent. Toppan Photomasks, which supplies companies including Samsung and Texas Instruments with a key component for creating semiconductor chips, is investing $185 million and creating 50 high-paying at its legacy plant in Round Rock. The expansion was encouraged by a $1.25 million incentive award approved by the Round Rock City Council in May 2023. “Over the 35 years we have operated in Round Rock, the city, chamber and community have been vital partners to our growth,” said Toppan’s president John Nykaza. “That support allows Toppan Photomasks to add much needed capacity to meet the needs of consumers and enhance our capabilities to advance the growing U.S. semiconductor industry and bring manufacturing back to the U.S.” TOP MANUFACTURING INDUSTRIES IN TEXAS BY GDP INDUSTRYTEXAS GDP (IN MILLIONS) CHEMICAL$48,208 PETROLEUM & COAL PRODUCTS$32,810 COMPUTER & ELECTRONIC PRODUCTS$29,304 FOOD, BEVERAGE, TOBACCO$19,017 AEROSPACE AND TRANSPORTATION$18,702 MACHINERY$16,250 MOTOR VEHICLES AND PARTS$13,981 FABRICATED METAL PRODUCTS$13,595 Source: Businessintexas.comTEXAS ECONOMIC DEVELOPMENT GUIDE 115 Clean Energy Manufacturing Committed as it is to its long- standing claim as the nation’s leader in oil and gas production, Texas is branching out to meet the accelerating demand for renewables. As 2023 came to a close, India-based solar panel maker Waaree Energies announced an ambitious plan to establish its first U.S. solar manufacturing site west of Houston. Located in the town of Brookshire, the facility is to have an initial capacity to manufacture 3 gigawatts of solar panels annually by the end of this year and up to 5 gigawatts by 2027, which would make it one of the largest solar module manufacturing facilities in the country. Waaree plans to invest up to $1 billion and create more than 1,500 jobs. “Waaree,” said Chairman and Managing Director Hitesh Doshi, “is fostering a solar manufacturing ecosystem in Texas, a state that has taken a leading position in clean energy manufacturing.” Also in December, John Cockerill announced its entry into the North American market with a new manufacturing complex in Baytown, Texas, where the Group will operate the first alkaline electrolyzer gigafactory in the United States. The facility is expected to produce 1 GW per year of electrolyzers, creating 200 jobs and bolstering Houston’s position as a hydrogen hub. The formal groundbreaking of the new plant was celebrated at an event attended by the Prime Minister of Belgium Alexander De Croo, the John Cockerill Group CEO Francois Michel, and John Cockerill President Americas Nicolas de Coignac. Prime Minister De Croo said, “Today’s ribbon cutting at John Cockerill’s Houston manufacturing facility is the first step into deepening the supply chain between Belgium companies and the Texas Gulf Coast.” François Michel, CEO of John Cockerill, said, “We at John Cockerill look forward to growing our presence in the hydrogen sector in North America, following in the footsteps of many other large-scale activities that we have established in the U.S. in the energy, heavy industry and defense sectors since 2004. We have a long history of pushing industrial innovation all around the world. We see Belgium, as both one of the most solid gateways to Europe and one of the most vibrant innovation hubs of the continent. And we believe that there are many good reasons for Houston to play a similar role in North America.” Next >