Solar Overtakes Coal as Grids Struggle

Solar generation in Texas is forecast to reach 78 billion kilowatt-hours in 2026, surpassing coal's 60 billion kilowatt-hours for the first time , according to the U.S. Energy Information Administration . The milestone marks a dramatic shift in America's largest energy-producing state, where solar's share of generation has climbed from 4% in 2021 to 12% in 2025, while coal's share dropped from 19% to 13% over the same period .

Texas is expected to account for approximately 40% of total U.S. solar capacity additions in 2026 , the EIA reported. Among the projects coming online this year is the Tehuacana Creek 1 Solar and battery energy storage system at 837 megawatts, expected to be the largest solar photovoltaic project commissioned in 2026 . Meanwhile, there are currently no plans to build new coal plants in the state's ERCOT grid , according to EIA data.

Can Europe's Grids Handle the Solar Surge?

While Texas celebrates its solar expansion, Europe faces a different challenge: too much renewable power and not enough infrastructure to handle it. Around 40 terawatt-hours of solar electricity—roughly enough to supply Greater London for a year—is expected to be discarded in the coming months, up by a quarter compared with 2025 , according to Brussels Signal reporting on industry analysis.

The phenomenon, known as curtailment, occurs when grid operators order generators to shut down because transmission networks cannot move the electricity to where it is needed . Germany curtailed about 3.1% of their total solar generation in 2025, up from 1.9% in 2024, and overall curtailed an estimated 9.6 TWh of wind and solar generation in 2025, nearly 4% of the total generation of these fuels , according to energy think tank Ember.

Across the continent, congestion management costs in Europe neared €9 billion in 2024, while 72 TWh of mainly renewable energy was curtailed due to bottlenecks—roughly equivalent to Austria's annual electricity consumption , according to Aurora Energy Research. Sonnedix CEO Axel Thiemann told reporters that "the assumptions that underpinned solar investments during and just after the energy crisis are no longer holding," adding that "negative prices as well as curtailment are eroding returns" .

Who's Winning the Global Wind Race?

The wind sector tells a story of dramatic geographic shift. Chinese turbine makers took the top six places in BloombergNEF's market share ranking for the first time in 2025: Goldwind maintained its position as the world's leading wind turbine supplier with 29.3GW installed, followed by Envision with 20.9GW, Mingyang and Windey, while Sany and Dongfang Electric rounded out the top six with around 13.5GW each .

China's newly installed wind power capacity surged 51% from a year earlier to 126 gigawatts in 2025, making it the first market globally to exceed 100 GW in annual additions, while global new wind installations reached 169 GW, up 38% from the previous year , BloombergNEF reported.

The UK government is pushing back with major offshore projects. The UK government gave planning permission to three offshore wind farms on May 14, which could create as much as 4 gigawatts of new capacity, including RWE and Masdar's two Dogger Bank South offshore wind farms with 1.5 GW of capacity each , Bloomberg reported. The proposed wind farms are expected to have a combined installed capacity of 3 gigawatts and would be capable of producing enough electricity to power the equivalent of approximately three million UK homes annually .

Does the Hormuz Crisis Change Everything?

The ongoing conflict in the Middle East is reshaping the economic case for renewables. The Energy Transitions Commission, whose members include executives from ArcelorMittal, HSBC and Shell, said in a report released May 14 that the current Middle East crisis highlights "a structural vulnerability in the global energy system: heavy reliance on geographically concentrated fossil fuel supply and critical transit routes," while "clean energy systems are structurally immune to this type of shock" .

EV deployment alone could displace around 5 million barrels per day by 2030 and 9-10 million barrels per day by 2035, equivalent to roughly half of pre-crisis Hormuz oil flows, and a coordinated clean energy response could displace 20% of global oil and over 30% of global gas demand by 2035 , the commission reported. Chinese solar exports doubled in March over February, with 50 countries recording all-time high solar PV imports—India around +140%, Ethiopia around +390% year-on-year—while EU EV registrations rose nearly 50% year-on-year in March .

Can Indian Manufacturers Compete in America?

One of the week's biggest deals came from India. Renewable energy company Inox Clean Energy announced it has acquired module and cell manufacturing capacity of 3 Gigawatt each from Boviet Solar Technology LLC, a U.S.-based solar manufacturing firm, in a $750 million deal , Business Standard reported on May 14. The solar module plant is operational but the cell manufacturing capacity is expected to be commissioned by December 2026 .

Akhil Jindal, Group CFO of INOXGFL Group, stated that the transaction provides the company with a scalable manufacturing platform in a policy-supported and high-margin market, adding that ongoing supply shortages in solar cells and the availability of 45X tax incentives are expected to create strong growth opportunities , according to SolarQuarter. The acquisition positions Inox to benefit from U.S. domestic content requirements that have made Chinese-owned manufacturers increasingly uncompetitive.

What Changed This Week

The renewable energy sector is experiencing a paradox of success. Texas demonstrates that solar can outcompete coal on pure economics, while Europe shows that infrastructure hasn't kept pace with deployment. Chinese manufacturers have consolidated their dominance in wind turbines even as Western markets push back with domestic manufacturing incentives. The Hormuz crisis has accelerated what was already happening—a structural shift toward energy sources that don't depend on vulnerable supply chains or geopolitical chokepoints.

What to Watch

The EIA now assumes that the Strait of Hormuz will remain effectively closed through late May, with flows slowly starting to resume in late May or early June, and expects it will take until late 2026 or early 2027 for most pre-conflict production and trade patterns to resume . Watch for Texas solar generation data through summer 2026 to confirm whether the coal crossover holds during peak demand periods. European policymakers face pressure to accelerate grid upgrades and battery storage deployment before the next solar season. And Inox Clean's December 2026 commissioning deadline for its North Carolina cell plant will test whether Indian manufacturers can successfully navigate U.S. domestic content rules.