Texas is moving another major power project toward completion as electricity demand reaches record territory on the state’s main electric grid.
Gov. Greg Abbott announced Wednesday that Texas finalized its ninth loan under the Texas Energy Fund, supporting a 452-megawatt natural gas power plant in Reeves County.
Developers expect the Pecos Power Plant to begin supplying the Electric Reliability Council of Texas grid in 2027.
State officials said the new capacity could provide enough electricity for approximately 110,000 Texas homes.
ERCOT currently lists an unofficial 2026 peak-demand record of 91,089 megawatts from July 22, up from the previous annual record of 85,508 megawatts set in 2023. ERCOT notes that its most recent demand records can change slightly as settlement data becomes final.
More Than One New Plant
The larger story extends beyond Pecos.
The eight projects already approved through the Texas Energy Fund’s In-ERCOT Generation Loan Program represent 4,994 megawatts of new power, according to Public Utility Commission of Texas data. Adding the 452-megawatt Pecos project means those nine projects together represent 5,446 megawatts of planned new generation.
ERCOT says one megawatt can serve about 250 residential customers during peak conditions. Using that benchmark only as a rough comparison, 5,446 megawatts corresponds to the peak electricity needs of approximately 1.36 million residential customers.
That comparison does not mean the projects will exclusively serve homes. The ERCOT grid also supplies businesses, manufacturers, data centers, oil and gas operations and other large electricity users.
The growth of large electrical loads has become significant enough that ERCOT held an October 6 workshop on how it could curtail certain large loads during emergency conditions under Senate Bill 6.
Built To Respond When Demand Moves
Public Utility Commission of Texas Chairman Thomas Gleeson said the Pecos facility will include quick-start capability and a design suited for West Texas winters.
“This project brings significant investment and more dispatchable power to West Texas, while benefitting all Texans by strengthening grid reliability,” Gleeson said in the governor’s October 7 release. “With quick start capabilities to meet fluctuating demand and a design suited for West Texas winters, this facility will add a dependable source of power for Texas families and businesses.”
Pecos Power Plant LLC is developing the project with Mercuria and Continental Resources as co-sponsors.
A Continental Resources federal filing says the company’s affiliate held a 50% economic interest in the joint venture as of June 30 and had contributed $164 million toward construction and development costs. Continental also reported capital commitment obligations of up to $257.8 million, including money already contributed. The filing says the plant is expected to become operational in 2027.
The governor’s October 7 announcement did not state the amount of the Texas Energy Fund loan.
A Grid Buildout Taking Shape
Texas voters created the Texas Energy Fund through a constitutional election on November 7, 2023. The In-ERCOT Generation Loan Program provides low-interest financing for qualifying projects that add at least 100 megawatts of new dispatchable generation to the ERCOT grid.
The Dallas Express previously covered another piece of that buildout in June, when the state finalized a $411 million loan supporting a 570-megawatt natural gas plant in Sherman.
The Pecos agreement adds another project to a broader effort to increase dispatchable generation as electricity demand climbs.
Texas is not relying on one sweeping fix. It is adding power project by project.
With ERCOT demand already reaching record territory, the first nine approved or finalized Texas Energy Fund projects now represent more than 5,400 megawatts of planned generation that could strengthen the grid as homes, businesses and major new industrial users demand more electricity.
