Governor Greg Abbott has announced a new Texas Energy Fund (TxEF) loan agreement for the construction of a 455 megawatt (MW) natural gas power plant in the Houston area. The facility will be built by NRG Energy Inc. and is expected to start supplying electricity to the Electric Reliability Council of Texas (ERCOT) region in 2028.
In his statement, Governor Abbott said, “Texas leads the nation in energy production, providing nearly one-fourth of the country’s domestically produced energy. 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 the impact of the fund so far: “The TxEF has now secured over 3,500 MW of safe, reliable, and affordable power for the State of Texas. 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.”
Robert J. Gaudette, Executive Vice President and President of NRG Business and Wholesale Operations, commented on NRG’s commitment: “Texas continues to experience unprecedented growth, and reliable power is essential to keep moving us forward. 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.”
This loan marks the sixth finalized under TxEF’s In-ERCOT Generation Loan Program, which provides low-interest loans aimed at adding new dispatchable generation capacity within ERCOT’s territory. The estimated total cost for this project is less than $617 million; under terms of this agreement with PUCT, a 20-year loan up to $370 million—covering about 60% of costs—will be provided at a 3% interest rate from November 20, 2025 through November 20, 2045.
The new plant will be constructed at NRG’s existing Greens Bayou Generating Station located in Harris County. It will connect within ERCOT’s Houston Load Zone—a key demand center encompassing cities such as Houston, Pasadena and The Woodlands—which collectively make up one of America’s largest metropolitan areas.
As part of its obligations under this agreement, NRG must ensure that performance standards set out by program rules are met. The TxEF program itself operates via a competitive application process managed by PUCT that includes thorough financial vetting.
Alongside these six approved loans already issued by TxEF so far—totaling over 3,500 MW—there are currently another eleven applications under review representing an additional potential capacity increase exceeding 5 GW across ERCOT’s network.
More information about both TxEF and its In-ERCOT Generation Loan Program can be found on the Public Utility Commission of Texas website.
