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Texas leaders are taking a closer look at how the Chinese Communist Party’s (CCP) influence may intersect with the state’s power grid, renewable energy buildout, and broader energy infrastructure. Recent developments have continued to push this issue to the forefront. Texas Attorney General Ken Paxton (R) launched an investigation into Chinese-manufactured components used in a Texas battery storage project. Separate reporting revealed significant CCP-linked ownership stakes in solar manufacturers operating in Texas. Lt. Gov. Dan Patrick (R) responded by directing a Senate committee to hold hearings in early 2026 to examine these connections. Together, these events reflect a growing recognition that foreign adversaries may be gaining footholds in sectors that affect the security and reliability of the Texas grid.
Texas does not enter this discussion from scratch. In 2021, the Legislature passed Senate Bill 2116 (SB 2116), known as the Lone Star Infrastructure Protection Act, which prohibits companies controlled by hostile nations from gaining direct or remote access to critical infrastructure. That law created a targeted, risk-based framework focused specifically on infrastructure access. As Texas now evaluates new concerns involving solar manufacturing, battery storage technologies, and foreign investment, the challenge is to maintain that targeted approach rather than drift into overly broad restrictions that compromise property rights or economic freedom. The ongoing investigation and upcoming hearings provide an important opportunity to examine real risks while reaffirming Texas’s commitment to constitutional protections.
Texas Power Grid Security and the CATL Investigation
Attorney General Paxton’s investigation centers on Contemporary Amperex Technology Co. Limited (CATL), a global battery manufacturer with links to the CCP. According to Paxton’s press release, a power storage facility under construction near Mabank, Texas, used CATL components that reportedly failed certain equipment tests. Paxton emphasized that Texas cannot allow foreign adversaries to infiltrate or undermine the state’s grid. He stated that CCP-aligned companies cannot be permitted to gain any backdoor access to Texas infrastructure and warned that companies violating state protections would be held accountable.
Paxton’s office pointed to the Lone Star Infrastructure Protection Act as the statutory basis for the investigation. Passed in 2021, the Act prohibits companies owned by or controlled by designated hostile nations from obtaining direct or remote access to critical infrastructure systems, including the electric grid. The law does not prohibit all use of foreign-made equipment. Rather, it focuses on whether a company’s involvement could enable access to system controls, data pathways, cybersecurity systems, or operational functions. CATL has denied posing any risk and stated that its equipment contains no communication capabilities, that it provides no operational services, and that it has no mechanism to access the facility’s control systems.
The investigation will determine whether components manufactured by a CCP-linked company could violate the restrictions in SB 2116. It will also test the boundaries of how Texas identifies risk within increasingly complex global supply chains. The outcome may inform whether additional safeguards are needed for energy storage projects that rely on foreign-produced technology.
CCP Influence in Solar Manufacturing and Federal Subsidy Concerns
Parallel concerns have emerged in the solar industry. Recent reporting showed that major North American solar companies, including Canadian Solar and Trina Solar, have deep operational and ownership ties to China. Both companies have benefited from tax incentives under the federal Inflation Reduction Act. Canadian Solar was founded by a Chinese entrepreneur and conducts most of its manufacturing in China. Its own filings with the Securities and Exchange Commission (SEC) acknowledge that the CCP may intervene in its Chinese subsidiaries at any time. Trina Solar, which restructured part of its North American operations into a Texas-based company called T1 Energy, retains substantial ownership stakes and board influence.
These companies have invested heavily in Texas manufacturing facilities and have been highlighted by federal officials as examples of domestic clean-energy expansion. Critics argue that these companies benefit from both Chinese state subsidies and American tax credits, allowing them to gain a competitive edge over fully domestic manufacturers. Because IRA tax incentives apply to companies just below certain ownership thresholds, some CCP-linked firms have structured themselves to qualify for American subsidies while retaining strategic connections to China.
For Texas, the implications extend beyond subsidy policy. If foreign-connected companies dominate portions of the solar supply chain inside Texas, they could shape long-term capacity, pricing, and infrastructure development. Lawmakers are increasingly concerned that foreign influence in renewable energy manufacturing could create dependencies that weaken Texas’s energy security or leave parts of the supply chain vulnerable to foreign pressure.
Patrick Orders Hearings on CCP-Linked Solar Firms
Lt. Gov. Patrick responded to the new reporting by announcing that the Senate Committee on Business and Commerce will hold hearings in early 2026. He noted that the Senate has already passed several bills designed to prevent foreign adversaries from connecting to the Texas grid and stated that new information suggests CCP-linked entities may have significant stakes in two solar companies operating in Texas. The hearings will require company executives to provide testimony about ownership structures, foreign partnerships, and any operational involvement by CCP-aligned entities.
Public hearings are a critical tool for determining whether Texas law adequately addresses evolving risks. The Legislature must evaluate not only the direct involvement of foreign-linked companies in energy production, but also more indirect forms of influence, such as technology licensing, joint ventures, and manufacturing dependencies. Patrick’s decision signals that Texas intends to verify claims made by companies, regulators, and federal agencies rather than rely solely on public filings or assurances.
SB 2116 and Today’s Grid Security Debate
SB 2116 provides a useful lens for understanding how Texas has historically approached foreign influence. Passed with unanimous support in the 87th Legislature, the Act prohibits companies owned or controlled by citizens or governments of China, Russia, Iran, North Korea, or other designated nations from obtaining access to infrastructure that could compromise cybersecurity or operational integrity. The law focuses on access, not ownership. Its purpose is to prevent adversarial nations from exploiting technological footholds in Texas systems.
That approach is narrow, targeted, and tailored to specific risks. It protects the Texas grid without restricting ordinary commerce, private property ownership, or international investment unrelated to infrastructure access. As Texas evaluates new concerns involving solar manufacturing and energy storage, SB 2116 shows how foreign adversary risks can be addressed through careful, limited legislation focused on real threats rather than broad prohibitions.
SB 17 as a Cautionary Property Rights Example
While Texas has legitimate security concerns related to CCP influence, the state must avoid drifting into overly broad restrictions that harm constitutional protections. Senate Bill 17, passed during the most recent legislative session (2025), illustrates how efforts to address foreign threats can expand far beyond critical infrastructure. SB 17 prohibits certain individuals and companies associated with designated foreign countries from purchasing or acquiring real property in Texas. It authorizes forced divestment, civil receivership, and state-initiated litigation to remove property from restricted owners. The law applies to agricultural, residential, commercial, mineral, and water-related property.
Texas Policy Research opposed SB 17 because its scope exceeds the narrow, access-focused strategy of SB 2116 and risks sweeping in innocent individuals, lawful investors, and refugees with no connection to foreign adversaries. The law ties state restrictions to federal threat assessments, expands the powers of the Attorney General, and creates mechanisms for forced divestment without full protections normally associated with property seizure. It demonstrates how foreign-policy concerns can evolve into policies that weaken property rights, due process, and limited government principles if not carefully constrained.
Including SB 17 in this discussion is important because Texas must distinguish between targeted measures that protect the grid and broader measures that place constitutional rights at risk. As Texas revisits foreign influence in energy infrastructure, the state should ensure that new proposals follow the model of SB 2116 rather than repeat the sweeping approach embodied in SB 17.
Balancing Energy Security and Property Rights
The central challenge for Texas is to address legitimate threats posed by CCP-linked entities while preserving the constitutional protections that define the state’s political and legal culture. Property rights are foundational in Texas, and any policy in this space must recognize that security concerns do not automatically override due process or economic freedom. TPR has long argued that foreign adversary risks should be addressed through targeted, evidence-based measures focused on critical infrastructure access and specific high-risk sectors. Texas should remain cautious about adopting policies that penalize individuals based solely on citizenship, domicile, or association rather than demonstrated behavior.
Maintaining this balance is crucial for Texas’s future. The state is a global destination for investment, innovation, and energy development. Overbroad restrictions could chill economic activity or dissuade legitimate investors. At the same time, failing to address CCP influence could create vulnerabilities that endanger the grid, supply chains, and state security. Texas must continue navigating this space carefully, ensuring that its protections reflect both the reality of modern geopolitical threats and the constitutional principles that distinguish Texas governance.
A Measured Path Forward for Texas Energy Policy
Texas is entering a new phase of oversight concerning CCP-linked companies operating in the state’s energy sector. Paxton’s investigation, Patrick’s forthcoming hearings, and reporting on solar manufacturing reveal that foreign influence in energy infrastructure is a complex and evolving issue. SB 2116 provides an example of how Texas can address these concerns through narrow, targeted legislation focused on real security risks. SB 17 serves as a cautionary example of the dangers of expanding state authority too broadly.
The path forward requires vigilance without abandoning constitutional protections. Texas can and should confront CCP influence in energy infrastructure, but it must do so with policies that protect both the grid and the liberty that defines the state. The ongoing investigation and upcoming hearings will help shape how Texas navigates this challenge, and any future reforms should remain grounded in the principles of limited government, property rights, and due process.
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