Houston facts

Report: Houston's energy transition economy sees momentum, including $6.1B in financing in 2022

According to the facts, Houston's energy transition is moving in the right direction. Photo via Getty Images

In Houston, the energy transition movement is in full effect — at least, according to the facts and figures from a recently released report.

The Greater Houston Partnership released its 2023 Houston Facts report, which analyzes the business community across sectors. The report highlights the fact that last year Houston's energy transition brought in $6.1 billion in financing from private market investments, which represents a 61.9 percent increase compared to 2021.

"Over the last five years, Houston has seen constant growth in annual energy transition investments, with a notable surge observed from 2020 onwards," reads the report.

Corporate and strategic merger and acquisition investments are what dominated the five deal types, according to the report, representing 68.8 percent of the total investment in 2022. Additionally, private equity accounted for 19.3 percent of all deals, with venture capital comprising 9.5 percent.

Source: GHP analysis of data from the U.S. Environmental Protection Agency, Greenhouse Gas Reporting Program (GHGRP)

According to Houston Facts, there are 550 Houston-based energy transition companies working in battery/energy storage, biofuels, carbon capture, use, and storage, circular economy, and other energy value chains.

The report also looked at clean energy job growth, which increased from 66,047 professionals in the Houston metro area in 2021 to projected increase to 71,305 jobs in 2022. The fastest growing type of clean energy job is within energy efficiency, a section that accounts for 68.1 percent of total clean energy employment last year, which increased 28.2 percent from 2021. Additionally, clean vehicle employment also saw a 14.7 percent increase while job counts in grid and storage and clean fuel applications declined notably in 2022, per the report.

Compared nationally, personal finance website SmartAsset recently ranked the Houston metro area as the fifth best place in the U.S. for green jobs, which pay an average of 21 percent more than other jobs. The SmartAsset study found that 2.23 percent of workers in the Houston area hold down jobs classified as “green.”

Source: GHP analysis and estimates of data from the U.S. Energy and Employment Report (USEER) and The Energy Futures Initiative (EFI), the National Association of State Energy Officials (NASEO), BW Research Partnership (BWRP) and E2 (Environmental Entrepreneurs)

The report also analyzed Houston's progress when it comes to emissions. Here are some of the Houston Facts on emission data from the U.S. Environment Protection Agency and the Greenhouse Gas Reporting Program:

  • Houston's power plant sector was as the largest greenhouse gas emitter with 43.2 percent of the region's total industrial emissions, and the sector has had an overall increasing trend over the past few years.
  • With 27.5 percent of industrial emissions, the chemicals sector came in No. 2, but the sector peaked in 2018, slightly declined in 2019, and have remained relatively constant through 2021.
  • Refineries ranked third, with for 21.2 percent of emissions, and have remained stable without notable increase over the past few years.
  • Petroleum and natural gas sector emissions have consistently increased since 2012, except for 2017. That year, Houston's overall emission rate reached its lowest point in the past decade at 225.1 mtCO2e.
  • Currently, Houston's emission rate is slightly below the highest point of the past ten years, which was 243.2 mtCO2e recorded in 2012.
Houston Facts, as well as other reports and resources, is available on GHP's website.

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A View From HETI

A new report shows that Texas data centers used 25 billion gallons of water in 2025. Photo via HARC report.

As data centers continue to boom throughout Texas, a new report from the Houston Advanced Research Center (HARC) warns that the trend could strain the state’s water supply.

HARC estimates Texas data centers used 25 billion gallons of water in 2025—and that the demand for water will continue to rise to meet the needs of the 464 data centers currently in Texas, as well as 70 additional sites currently under development.

In the report, titled “Thirsty Data and the Lone Star State: The Impact of Data Center Growth on Texas’ Water Supply,” The Woodlands-based nonprofit says that water use for cooling data centers is expected to double or triple by 2028 on the national level. If projections hold, the total annual water use for data centers in Texas will increase by 0.5 percent to 2.7 percent by 2030, or to between 29 billion and 161 billion gallons of water consumed.

Data centers often use water for cooling, though water demand is dependent on the type of cooling used, the size and type of the data center. Although used water can be reused, some new water withdrawals are always needed to replace evaporated water and other systems’ water losses. Water is also used to cool the power plants that generate electricity used by the data centers.

The HARC report offers guidance to address the overall concerns of water demands by data centers, including:

  • Dry cooling methods
  • Increased reliance on wind and solar energy sources
  • Alternative water supplies, like treated wastewater or brackish water for cooling
  • Adjusted operating schedules to accommodate water usage
  • Partnering with local companies to develop projects that reduce water leaks
  • Companies creating their own water infrastructure investments

The report goes on to explain that the Texas State Water Plan, produced by the Texas Water Development Board, projects shortages of 1.6 trillion gallons by 2030 and 2.3 trillion gallons by 2070. HARC posits that the recent surge in water demand from AI data centers is not fully reflected in those projections.

"Texas water plans always look backward, not forward," the report reads. "That means the 2027 water plan, which is in development now, will be based on 2026 regional water plans that do not include forecasted data center water use. Data centers that began operation in 2025 will not be added to the State Water Plan until 2032."

Currently, there are no state regulations that require data centers to report how much water they use. However, the Public Utility Commission of Texas (PUC) plans to survey operators of data centers and cryptocurrency mining facilities on their water consumption, cooling methods and electricity sources this spring. It is expected to release the results by the end of the year. The companies will have six weeks to respond. The Texas Water Development Board will assist the PUCT on the questions.

“I think we all recognize the importance of data centers and the technology they support and what they give to our modern-day life,” PUC Commissioner Courtney Hjaltman said during the last commission meeting. “Texans, regulators and the legislature really need that understanding of data centers, really need to understand the water they’re using so that we can plan and create the Texas we want.”

See the full HARC report here.

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