A $249 million solar project in Hidalgo County is in limbo — here’s why

A $249 million solar project in rural Hidalgo County appears to be in limbo after the company behind it filed for Chapter 11 bankruptcy last month and said it expects to lay off about 78% of its workforce. 

Pine Gate Renewables, an energy developer founded in 2016 and headquartered in Asheville, North Carolina, operated more than 100 utility-scale solar projects throughout the U.S. at its peak. It had another 130 projects under development — about two dozen of them in Texas. 

One of them, a proposed 249-megawatt solar project, was planned to be built about a mile west of Linn in northern Hidalgo County. 

Once completed, the project was slated to generate enough electricity to power roughly 40,000 homes annually, based on national averages cited by the Solar Energy Industries Association. It was also expected to create 300 construction jobs.

But the 2,000-acre plot, which had already been designated as a Texas Enterprise Zone, appeared undisturbed during a recent December site visit. 

The Rio Grande Valley Business Journal reached out to Pine Gate for comment, but the company did not respond. 

The site, which sits just north of Farm-to-Market Road 1017 and west of U.S. 281, remains a stretch of uninterrupted ranchland. Known as El Tule Ranch, the land is owned by the Guerra family. 

Pine Gate was scheduled to break ground on the project next year and begin operations by 2028. Hidalgo County commissioners had already approved a 50% tax abatement for the company’s first five years. 

Instead, Pine Gate filed for Chapter 11 bankruptcy protection last month to stabilize its finances and sell its solar projects under court supervision. It also announced it would lay off 233 workers in North Carolina in January, or about 78% of its workforce. 

Pine Gate blamed rising costs, higher interest rates, and federal regulatory changes for its financial strain and its inability to pay key contractors. 

“With respect to the renewable energy industry, legislative and regulatory challenges have significantly slowed solar power development,” Ray Shem, chief financial officer of Pine Gate Renewables, wrote in the bankruptcy filing. 

Shem also noted that President Trump’s One Big Beautiful Bill eliminated the federal investment tax credit for solar projects and highlighted tariffs. 

“Steep tariffs have been imposed on virtually all imported materials necessary to construct utility-scale solar projects,” Shem continued. “In addition, continued inflation has led to increased costs in project development and construction.” 

Through bankruptcy, Pine Gate is seeking to keep operations going while running a structured auction that could transfer projects to new owners.

Interested buyers can bid on the company in an auction scheduled for Dec. 17.