Two States, Two Strategies

By Simon West

California and Texas are forging distinct energy paths – one green, one fossil-fueled. Both are powering a surge in project cargo demand. We speak to industry leaders and government representatives to find out what's driving business in America's powerhouse states.

From Issue 4, 2025 of Breakbulk Magazine

(7-minute read)

The powerhouse states of California and Texas are forging distinct paths in pursuit of their project priorities. One is pushing hard on renewables, the other doubling down on fossil fuels and other forms of energy. Both strategies are driving demand for project cargo.

Texas, the nation’s top exporter, is capitalizing on the Trump administration’s policies of deregulation, expanded leasing and lifted liquified natural gas (LNG) export restrictions. The result: fast permitting and infrastructure buildout.

“Texas is the energy capital of the world, leading the nation in energy and electricity production. That success comes from our ‘all of the above’ strategy, driving investment across diverse energy sectors,” said Adriana Cruz, executive director of Texas Economic Development and Tourism within the Office of the Texas Governor Greg Abbott.

“Our great state is the No. 1 producer of crude oil and natural gas in the U.S. We also rank No. 1 for wind energy and No. 1 for solar growth projection over the next five years. Not to mention, Texas is the fastest-growing battery storage market in the nation.

“This diverse range of innovation in our energy industry, supported by our strategic approach in attracting all kinds of new and expanding energy businesses, fuels our state’s economy and moves the nation forward towards achieving energy independence.”

California Keeps It Clean

The creative spirit is also alive and kicking in the Golden State.

“Being at the forefront of innovation is inherent in California’s culture,” said Job Nelson, chief government and public relations officer at the Port of San Diego. By focusing on innovation, he said, the state is showing that it is possible to invest in new technologies while also maintaining a thriving business sector.

“California’s success is evident with its ranking as the world’s fourth largest economy.”

But while Texas answers to President Trump’s call to “drill baby, drill”, California remains focused on building a clean energy economy, driven by state mandates and a commitment to hitting environmental and net-zero targets. The state has signed various Memorandums of Understanding (MoUs) and other agreements with more than 20 countries – including the UK, China and Australia – focusing on climate change and clean energy collaboration.

Nelson pointed to how California’s leadership on tackling air emissions dates back to the 1960s, when then- Governor Ronald Reagan established the California Air Resources Board (CARB). That legacy continues today, with mandatory renewable energy targets signed off by Governor Gavin Newsom that include a zero-carbon electricity grid by 2045.

For the logistics sector, zero-emissions (ZE) policies direct all drayage trucks and off-road equipment in the state to be ZE by 2035 and all medium- and heavy-duty vehicles by 2045.

These ZE goals helped drive the port’s decision to adopt its 2021 Maritime Clean Air Strategy (MCAS), billed as the most ambitious plan of its kind by a U.S. port. Supported by robust state-level incentive programs, the port has zeroed in on cutting emissions, improving air quality around San Diego Bay, and modernizing aging infrastructure to better support its maritime operations and the breakbulk sector.

“An example of this is the deployment of our two all-electric mobile harbor cranes, each of which has a lifting capacity of 200 tons and a combined capacity of 400 tons, making us the port with the heaviest lifting capacity on the West Coast,” Nelson said.

According to the executive, the port and its partners have so far committed more than US$227 million to projects ranging from electrical upgrades and electric cargo handling equipment to berth rehabilitation and at-berth emissions reduction equipment.

Further up the coast, the Port of Long Beach is planning to invest more than US$3.2 billion over the next decade in capital projects, including more than US$220 million dedicated to ZE infrastructure. The port plans to switch all cargo-handling equipment to ZE models by 2030.

Long Beach is also developing Pier Wind, a proposed 400-acre facility to stage, store and assemble floating offshore wind turbines. Set to be the largest of its kind at a U.S. seaport, the project would support California’s 25 gigawatt (GW) offshore wind target by 2045.

Suzanne Plezia, managing director of engineering services at the Port of Long Beach, said fully assembled turbines “the size of the Eiffel Tower” would be towed by sea from the port to wind lease areas 20 to 30 miles (32 to 48 kilometers) off California’s central and northern coasts. Pier Wind’s preliminary design plan was completed last year.

“Local, state and federal regulatory agencies started an environmental review in late 2023, and the Port of Long Beach is now gathering input from the community. The port is now completing engineering, environmental, business planning and community outreach requirements needed to begin construction,” Plezia said.

“If approved, construction of the US$4.7 billion project could start as soon as 2027, with the first 200 acres completed in 2031, and the final 200 acres coming online in 2035.”

Riding the LNG Wave

Back in Texas, energy is also driving sustained demand for breakbulk, although here it is LNG emerging as the Lone Star State’s fastest growing sector, according to project professionals speaking to Breakbulk.

A Trump executive order in January effectively overturned the Biden administration’s temporary “pause” on approvals of LNG exports to non-free trade agreement countries, spurring new project development and investment in the industry.

In late June, Bechtel was given the go-ahead by Cheniere Energy to build two new midscale liquefaction units at Cheniere’s Corpus Christi LNG terminal in Texas. Trains 8 and 9 are expected to add three million tonnes per annum (mtpa) of LNG capacity to the plant, located on the La Quinta Ship Channel along the north shore of Corpus Christi Bay.

The trains will be built adjacent to the seven-train Corpus Christi Liquefaction Stage 3 (CCL3) project, which has already entered construction and commissioning phases. Once complete, the CCL3 project, trains 8 and 9, and other debottlenecking operations are expected to double overall capacity at the Gulf Coast facility to more than 30 mtpa.

“We expect all nine trains to be operational later this decade,” a spokesperson for Cheniere told Breakbulk. Cheniere, the largest producer of LNG in the U.S., also operates Sabine Pass LNG on the U.S. Gulf Coast. The spokesperson said the company was developing further brownfield capacity expansions at both terminals, projects that could boost its LNG platform to about 75 mtpa “by the early 2030s”.

Bechtel in June also inked fresh contracts with LNG producer NextDecade for the construction of two liquefaction units at the Rio Grande terminal in Brownsville, a port city located on the southernmost tip of Texas. The deals include a US$4.77 billion updated EPC contract for train 4 and a newly signed US$4.32 billion deal for train 5. Construction of trains 1 to 3 has already begun, with start-up slated for 2027.

NextDecade said the Brownsville site has sufficient space for the installation of up to 10 liquefaction trains, making Rio Grande potentially one of the world’s largest LNG production and export facilities. The Houston-based developer is also looking to build a carbon capture and storage (CCS) project at the site to reduce emissions.

To illustrate the scale of these projects, building the first three trains of the Corpus Christi terminal required 250,000 cubic meters of concrete, 50,000 tons of steel, 340 kilometers of piping and 3,800 kilometers of electric cables.

Several news sources report that LNG exports from the Port of Corpus Christi – the largest U.S. port by revenue tonnage – are projected to double in the coming years, driven by Cheniere’s nine-train expansion.

The port has been undergoing significant infrastructure upgrades, announcing in June the completion of the US$625 million Channel Improvement Project, a decadeslong initiative to deepen the Corpus Christi Ship Channel from 47 to 54 feet mean lower low water (MLLW) and widen it to 530 feet.

Other infrastructure improvements at Corpus Christi include upgrades to its Bulk Terminal docks and a 35-acre expansion of laydown storage on the Northside of the breakbulk-handling Cargo Dock 9. Omar Garcia, chief external affairs officer at Corpus Christi, previously told Breakbulk the Cargo Dock 9 project aimed to provide direct rail access to the dock as well as the capability to load a full unit-train in Rincon West, an open storage area designed to house general, project and roll-on, roll-off (RoRo) cargoes.

“Texas’ port infrastructure is the driving force behind our status as the top exporter in the nation,” Cruz said. “We are already home to the No. 1 port in the U.S. for waterborne foreign trade – Port Houston – and the nation’s No. 1 international trade port – Port Laredo. The state continues to invest in new infrastructure projects, such as a US$240 million commitment to port development and seaport connectivity.”

LNG aside, Texas is also setting its sights on nuclear energy, with plans to deploy large-scale nuclear power plants (NPPs) and small modular reactors (SMRs).

New legislation signed off by Governor Abbott is set to put Texas at the center of the country’s nuclear revival. The law establishes the Texas Advanced Nuclear Energy Office and allocates US$350 million to advance next-generation nuclear technology and deployment.

Green Hydrogen for the Golden State

California, meanwhile, is expected to remain the top U.S. market for renewable energy-related project cargo through 2035, driven by exciting new initiatives such as the H2Hubs program, which could unlock significant new cargo-carrying opportunities.

Managed by the Department of Energy’s (DOE) Office of Clean Energy Demonstrations (OCED) and funded through the 2021 bipartisan infrastructure law, the program comprises a network of seven green hydrogen hubs across the U.S. aimed at accelerating the development of a clean hydrogen economy.

The Alliance for Renewable Clean Hydrogen Energy Systems, or ARCHES, is the Californian H2Hub. With the help of up to US$1.2 billion in federal grants, ARCHES is developing more than US$70 billion in hydrogen infrastructure projects, including more than 10 production sites in the state’s Central Valley, port decarbonization at the ports of Long Beach and Oakland, a first-of-its-kind hydrogen-powered marine research vessel, and 60 fueling stations statewide for zero-emission trucks and buses.

According to Angelina Galiteva, CEO of ARCHES, these projects, now in the planning phase, aim to significantly expand California’s clean hydrogen economy. By 2030, the hub is expected to reach a balanced generation and offtake capacity of 450–500 tons per day.

“Many of the planned projects are being developed with a strong emphasis on renewable energy sources such as wind and solar and other diverse feedstocks including biogenic materials to support flexibility and resilience in hydrogen production,” Galiteva said.

Other developments of note in California include the Darden Clean Energy Project to produce largescale solar and battery components and the CAISO grid expansion, a US$4.8 billion effort to build 31 infrastructure projects, including transmission towers, transformers and high-voltage cables.

Green Goals, Red Threats

Still, large-scale industrial projects are often at the mercy of politics, where funding and momentum can shift with every administration. While Texas enjoys stronger alignment with federal goals, California’s renewables-led agenda is increasingly exposed to political pushback.

In May, U.S. Secretary of Energy Chris Wright announced that the DOE would be axing US$3.7 billion in funding for 24 clean energy projects, citing their lack of “economic viability.” The awards were issued by the OCED during Biden’s term and focused on decarbonization and CSS.

Although just three of the two dozen projects were based in California, the DOE’s decision to withdraw this support made plain the Trump administration’s priorities.

One of the biggest cuts was a US$500 million award handed to the National Cement Company of California to convert its Kern County production plant into a carbon-neutral facility using limestone calcined clay cement, or LC3, and biomass feedstock. The company was also mulling a largescale CCS facility at the site.

A further blow to California’s climate ambitions came in late June when it was reported that the Trump administration was moving to end a 2012 agreement that gave state officials control over permitting oil projects on federal land. The decision drew praise from California Republicans, who called the deal outdated and a “significant barrier” to oil production.

More reductions in clean energy funding could further undermine California’s climate ambitions, with reports claiming that the H2Hubs program is particularly at risk. Four of the seven hubs, including ARCHES, are slated for cuts, according to documents seen by Politico. Lawmakers from both parties have urged the DOE not to eliminate the funding, arguing it would violate contracts and jeopardize thousands of jobs.

Responding to the threat, CEO Angelina Galiteva said ARCHES was “actively planning across scenarios to maintain momentum” and that the company was “committed to advancing clean energy, creating quality jobs, and driving economic growth statewide.”

Despite the uncertainty, port executives in California remain bullish, pointing to recent clean energy gains and a continued push towards net-zero emissions.

Plezia at the Port of Long Beach said two decades of sustainability efforts have delivered a cleaner harbor, green building benchmarks and major improvements in air quality, including a 92% drop in diesel emissions, 71% in nitrogen oxides, 98% in sulfur oxides and 17% in greenhouse gases.

“As a leader in trans-Pacific trade, the Port of Long Beach will not ease up on its environmental goals for cleaner air and water and will continue to work towards becoming the world’s first zero-emissions port,” Plezia said.

Nelson acknowledged that a stable source of public funds was “critically important” to ongoing port modernization but noted that the U.S. Department of Transportation was among the few federal agencies to receive a funding boost in the president’s proposed 2026 budget.

The Port of San Diego is already reaping the rewards from several awards programs administered by the DOE, Nelson said, including a US$58 million EPA Clean Ports Grant to electrify its Tenth Avenue Marine Terminal. Combined with US$28 million from the port and its tenants, the US$86 million project will nearly fully electrify cargo-handling operations.

“With these funds secure, port staff are fully focused on project implementation and demonstrating our commitment to our neighbors and responsible stewardship of public resources,” Nelson said. “The port also looks forward to laying the groundwork for future projects and continuing to lead by example, advancing not only air quality initiatives but also providing high quality service to our customers.”

Read more: 10 US Policies Under Trump: Which Matter to Project Cargo

Top photo: Port of San Diego deploys an electric crane for a yacht delivery. Credit: Port of San Diego
Second: Cheniere's Corpus Christi liquefaction terminal, Texas. Credit: Cheniere
Third: Oversized transformers are discharged at the Port of Long Beach. Credit: Port of Long Beach