September 29, 2025

Baytown, Texas Welcomes Major Energy Boost

News Summary

Baytown, Texas is set to experience a significant surge in energy production with the announcement of a new 721-megawatt natural gas power plant. This development, backed by a $562 million loan from the Texas Energy Fund, aims to support the state’s growing energy demands. Governor Abbott highlighted the importance of this project for Texas’s energy leadership, as it is expected to begin generating power by summer 2028. The plant will create job opportunities and enhance energy reliability in the region.

Texas Governor Greg Abbott has announced a significant $562 million loan to NRG Energy Inc. for the construction of a new 721-megawatt (MW) natural gas power plant in Baytown. This project is part of efforts to support the growing energy demands in the state as it continues to expand in population and economic activity.

The new power plant will be built at the Cedar Bayou Generating Station, located off Highway 146 in Baytown. The loan is the third issued under the Texas Energy Fund’s In-ERCOT Generation Loan Program, which aims to fund projects that increase dispatchable power within the Electric Reliability Council of Texas (ERCOT) grid. The loan term is set to begin on September 26, 2023, and will continue until September 25, 2045.

NRG Energy anticipates that the facility will start generating electricity by the summer of 2028. The overall cost of the project is estimated at $936 million. Governor Abbott emphasized that such investments are critical to meeting the increasing energy requirements of both Texas residents and businesses.

In addition to this new project, NRG previously received $216 million in August through the same program for another natural gas plant, this one focusing on a 456-MW capacity at the TH Wharton Generating Station located in North Houston. The company is also considering the development of an additional fast-start natural gas plant capable of generating another 456 MW at Greens Bayou.

The energy landscape in Texas is witnessing a surge in activity, with reports indicating that various companies are looking to establish 108 new power plants and expand 17 existing facilities statewide in the coming years. This push is necessary to keep pace with the rising energy demands triggered by advancements in technology and the proliferation of data centers.

Texas remains a national leader in renewable energy, particularly in wind power generation, yet natural gas remains the dominant source of energy within the state’s production mix. The newly planned power plant is expected to significantly bolster the ERCOT Houston Load Zone, one of the largest electricity demand centers in Texas.

The Public Utility Commission of Texas (PUC) Chairman has pointed out that the new facility will add a substantial 721 MW of power to the ERCOT grid, contributing to a total of 1,299 MW of new dispatchable generation under the Texas Energy Fund program. The program stipulates that any funded facility must meet specific performance standards as outlined in its rules.

The Texas Energy Fund program operates through a competitive application process that includes meticulous financial assessments of prospective projects. In addition to the current loans, there are 14 more applications under review representing a potential 7,671 MW of new dispatchable generation for ERCOT, highlighting the increasing emphasis on reinforcing the energy infrastructure in Texas.

Moreover, the anticipated economic benefits from the Baytown power plant construction are noteworthy. It is expected to create numerous jobs during its construction phase and sustain permanent jobs once the facility is operational, thus providing a boost to the local economy.

This initiative aligns with Texas’s long-term energy strategy, aiming not only to meet current demands but also to prepare for future challenges in a rapidly evolving energy market. As the state continues to grow, maintaining a reliable and robust energy supply will remain a top priority for both state officials and energy providers.

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Author: STAFF HERE GEORGETOWN

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