NRG Energy has secured another loan from the Texas Energy Fund (TxEF), marking a significant step in the state’s ongoing efforts to bolster its energy infrastructure. The Texas-based utility will use the funding to construct a 455-MW natural gas-fired station at the site of its existing Greens Bayou Generating Station in Harris County, near Houston. This project is one of six selected to receive a loan from the TxEF, which was established in November 2023 following a constitutional amendment approved by Texas voters. The new generation capacity from these six projects now exceeds 3.5 GW, according to the state’s Public Utility Commission.
NRG Energy anticipates that the new facility will commence commercial operation in 2028. This marks NRG’s third project to receive support from the loan fund, with these projects collectively representing about 1.5 GW of generation capacity and receiving up to $1.15 billion in low-interest loans. Texas Gov. Greg Abbott highlighted the state’s leadership in energy production, noting that Texas provides nearly one-fourth of the country’s domestically produced energy. He emphasized that the new power plant will enhance Texas’ energy infrastructure and ensure affordable, reliable power for decades to come.
“The TxEF has now secured over 3,500 MW of safe, reliable, and affordable power for the State of Texas,” said Public Utility Commission of Texas (PUCT) Chairman Thomas Gleeson. “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.”
The Texas Energy Fund’s In-ERCOT Generation Loan Program offers low-interest loans for projects that add new, dispatchable power to the ERCOT region. Officials stated that under the loan agreement for the new plant, total project costs are estimated to be less than $617 million. The PUCT is providing a 20-year TxEF loan up to $370 million, or 60% of the total cost, at a 3% interest rate. The loan term runs from Nov. 20, 2025, through Nov. 20, 2045.
“Texas continues to experience unprecedented growth, and reliable power is essential to keep moving us forward,” said Robert J. Gaudette, NRG executive vice president and president of NRG Business and Wholesale Operations. “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 Gov. Abbott, the Legislature and the PUCT for their leadership in ensuring Texas remains powered for the future.”
NRG noted that the new gas-fired plant will interconnect in the ERCOT Houston Load Zone, one of the largest electricity demand centers in Texas, encompassing Houston, Pasadena, and The Woodlands. The facility must meet minimum performance standards under the loan agreement, as outlined in the program rules. The TxEF is administered by the PUCT through a competitive application process and financial review of proposed projects. Currently, there are 11 applications to the TxEF In-ERCOT Generation Loan Program undergoing due diligence, in addition to the six loan agreements already approved. These applications represent an additional 5,406 MW of proposed, new dispatchable generation for the ERCOT grid.
This development underscores Texas’ proactive approach to securing its energy future, with significant implications for grid resilience, economic growth, and job creation. As the state continues to expand its energy infrastructure, the role of the TxEF in facilitating these projects will likely become increasingly pivotal. The focus on dispatchable generation highlights a strategic priority for ensuring reliability in the face of growing demand and evolving energy dynamics.