Governor Greg Abbott has announced a new Texas Energy Fund (TxEF) loan agreement to support the construction of a 455 megawatt (MW) natural gas power plant in the Houston area. The facility will be developed by NRG Energy Inc. and is expected to begin generating electricity for the Electric Reliability Council of Texas (ERCOT) region in 2028.
“Texas leads the nation in energy production, providing nearly one-fourth of the country’s domestically produced energy,” Governor Greg Abbott said. “This 455 MW investment by NRG in Harris County will add more power to Texas’ energy infrastructure and the fifth largest metropolitan area in America. This new power plant will ensure every Texas home has affordable, reliable power for decades to come.”
Public Utility Commission of Texas (PUCT) Chairman Thomas Gleeson highlighted that this latest agreement brings TxEF’s secured capacity to over 3,500 MW statewide. “Texans wisely recognized the need to prepare our grid for the future when they voted to create the TxEF in 2023, and the fund is delivering on that promise,” Gleeson said.
Robert J. Gaudette, Executive Vice President and President of NRG Business and Wholesale Operations, commented on the importance of reliable power as Texas continues its rapid growth: “Our investment at Greens Bayou reflects NRG’s commitment to delivering dependable, dispatchable generation when Texans need it most. These units will strengthen grid resilience, create local jobs and support economic vitality. We appreciate Governor Abbott, the Legislature and the PUCT for their leadership in ensuring Texas remains powered for the future.”
The loan agreement between PUCT and NRG marks the sixth finalized under TxEF’s In-ERCOT Generation Loan Program. This program offers low-interest loans for projects that increase dispatchable power within ERCOT’s territory. The total project cost is estimated at less than $617 million; PUCT will provide a 20-year loan up to $370 million—covering about 60% of costs—at an interest rate of 3%. The loan term extends from November 20, 2025 through November 20, 2045.
The new facility will be located at NRG’s existing Greens Bayou Generating Station in Harris County and will serve one of Texas’ highest electricity demand areas—the Houston Load Zone—which includes Houston, Pasadena, and The Woodlands.
To qualify for funding under this agreement, facilities must meet specific performance standards as outlined by program rules. The TxEF is managed by PUCT through a competitive application process involving detailed financial review.
Currently, there are eleven additional applications under review for potential loans from TxEF’s In-ERCOT Generation Loan Program. If approved, these could bring another 5,406 MW of dispatchable generation capacity online across ERCOT’s network.
More details about TxEF and its programs can be found on the Public Utility Commission of Texas website.
