Texas Approves Loan for 455-Megawatt NRG Gas Plant to Strengthen Grid Reliability

Texas Governor Greg Abbott on Nov. 20 announced a new Texas Energy Fund loan agreement for a 455-megawatt natural gas project that NRG Energy will develop in the Houston area. The agreement supports the construction of a new unit at the Greens Bayou Generating Station in Harris County, placing the facility within the state’s effort to expand firm generation and strengthen reliability across the Electric Reliability Council of Texas region.

NRG Energy will build the project at an estimated cost of less than $617 million. The Public Utility Commission of Texas will provide a 20-year loan of up to $370 million at a 3 percent interest rate, with the term running from Nov. 20, 2025 to Nov. 20, 2045. The facility is expected to begin producing electricity for the grid in 2028 and will connect into the Houston Load Zone, one of the largest demand centers in the country.

The loan is the sixth approved under the TEF’s In-ERCOT Generation Loan Program, which makes low-interest financing available for new dispatchable resources. Projects that receive funding must meet performance requirements set in program rules to ensure they can deliver consistent output during periods of high demand. Each application undergoes a competitive review and financial assessment before approval.

State regulators are reviewing 11 additional applications under the TEF that represent 5,406 megawatts of proposed new generation. These projects would add substantial firm capacity as Texas continues to manage rising electricity use across industrial and residential hubs.

The Greens Bayou project reflects the state’s broader strategy to support new gas-fired development that can respond quickly when system conditions tighten while contributing to economic activity in the Houston region.