Texas' renewable energy industry is bracing for a hit in the new year as the Trump administration is ending key tax credits.

Why it matters: Wind and solar power are relatively speedy ways to add electricity to the grid as demand rises — and they helped stave off power shortages in Texas during the summer.

Driving the news: As part of the "big, beautiful bill," the Trump administration is phasing out a residential rooftop energy credit by January.

• Also on the cutting block are tax credits for energy-efficiency home improvements and big wind and solar projects that become operational after 2027.
• Separately, the administration canceled a $7 billion solar power program meant to add rooftop solar in low-income communities across the country.
• About $400 million of that was earmarked for Texas.

What they're saying: In a July executive order ending subsidies for renewable energy, President Trump said wind and solar power "denigrates the beauty of our nation's natural landscape."

The other side: "This summer, renewables carried the grid," Matt Boms, executive director of the Texas Advanced Energy Business Alliance, told reporters this fall in a briefing organized by the Texas Reliable Grid Project, a group that promotes clean energy.

• In August alone, Boms said, wind and solar supplied about one-third of all power on the Texas grid.

By the numbers: Companies have invested more than $2 billion in solar and battery projects in Texas in the last year, according to the Clean Investment Monitor, a project from research organization Rhodium Group and MIT.

What's next: Because of the growth of renewables, "Texas is better prepared for winter than before," Doug Lewin, host of the Energy Capital Podcast, said in the briefing.

The bottom line: "A lot of people are trying to install solar right now, because once you roll into January you won't get the credit," Bret Biggart, the CEO of Freedom Solar Power, a residential solar installation company based in Austin, told the nonprofit news site Capital & Main.

• "I would say once that credit is gone, the solar market is going to go down by 30% to 40%."

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Research firm BloombergNEF sees U.S. power demand from data centers reaching 106 gigawatts by 2035, per new analysis.

Why it matters: That's a 36% upward revision from its April outlook, "illustrating just how quickly the sector is expanding."

Zoom in: Texas data center capacity is expected to more than double by 2035, reaching 14 gigawatts.

• Data center expansion could start to strain the Texas power grid as soon as 2028, per BNEF's analysis, even as the state adds solar power and battery storage.
• Solar energy in Texas is projected to triple in the next decade, and power storage is expected to quadruple by 2035, growing to 40 gigawatts from 10 gigawatts now.

Yes, but: Even that bigger 2035 projection is still pretty conservative compared to estimates from Goldman Sachs, BCG, McKinsey and several others.

The big picture: The study highlights big, interlocking trends.

• Development is moving away from urban areas as facility sizes grow. "Today, US data centers are typically located in suburban areas within 30 miles of major cities," it finds.

What we're watching: The simmering backlash in some regions, which The New York Times recently explored.

🏨 The Faust Hotel, which originally opened in 1929, will reopen in spring 2026 as a 45-room boutique property in downtown New Braunfels. It will have new restaurants and a basement speakeasy. (The Faust Hotel)

🥘 Tinto Y Tapas Restaurant & Latin Lounge, led by KRTU hosts Judi Deleon and Henry Brun, will open near Phil Hardberger Park in early 2026. (CultureMap SA)

🚙 The Loop 1604–I-10 interchange project, now roughly 70% complete, is on track to finish in 2026 and is expected to cut north Bexar County commute times by more than 76%. (KSAT)

Friday

🎁 Get in the spirit during the Holidays on Houston Street market, lasting through Sunday with more than 50 vendors.

• Market schedule varies.

🤠 Catch rising Texas country singer William Beckmann's Las Posadas tour at Stable Hall, running through Sunday.

• Tickets start at $69; doors open at 7pm.

Saturday

👹 Lean into the Labubu world at Labubupalooza at Wonderland of the Americas, 11am–5pm (also happening Sunday).

• There will be vendors and more. Free to attend.

🛍 Get more shopping done (and maybe have a drink) at an artisan market at Real Ale Brewing Company in Blanco, noon–6pm.

• Free to attend.

🫔 Experience the inaugural Pullman Market Tamale Festival, 1–5pm.

• Admission is free with an online RSVP; tamales will be available for purchase.

Sunday

🐶 Take your pup to get a Santa Claus photo during SNIPSA's holiday event at Down on Grayson, 11am–4pm.

• Reservations ($10) are encouraged.

We want your expertise for a guide to the city's most beloved holiday shopping spots.

Which local shops never miss when you're hunting for meaningful gifts?

What's next: Hit reply and tell us where you go — and why — and we may include your recs in an upcoming edition.