$5.4 billion in government loans for natural gas power plants

AUSTIN – The Dallas Morning News reports that Texas electricity regulators picked 17 companies Thursday that will move forward with government-financed natural gas power plants. Public utility commissioners approved the proposals for fossil fuel power plants capable of generating enough electricity to power 2.4 million homes. If the companies prove their projects are viable, they will receive 3% loans from the taxpayer-funded Texas Energy Fund. The Texas Legislature created the fund in 2023 to finance about 10 gigawatts of electric generation capacity to shore up the ERCOT power grid. It is one of a myriad of legislative directives since the power blackouts of the 2021 winter storm killed more than 200 Texans. The fund currently includes $5 billion. Gov. Greg Abbott and Lt. Gov. Dan Patrick have pledged to double funding ? a likelihood because the bill creating the energy fund was always planned to reach $10 billion.

Commissioners approved loans amounting to about $5.4 billion. Public Utility Commission spokesperson Ellie Breed said accrued earnings on the initial $5 billion of funding will let the agency fund all the projects if they are ultimately approved. “Today’s action to advance a set of applications to due diligence does not guarantee that those applicants will enter into a loan agreement,” Breed said in an email. Business interest in the program has remained high since the Public Utility Commission of Texas opened it up to proposals. The commission received 72 applications for $24.4 billion to finance 38 gigawatts of power generation. Texas’ all-time record for peak power demand is 85.6 gigawatts. Republican lawmakers, in response to the 2021 winter storm, have prioritized encouraging the construction of new, non-weather-dependent power plants. They created eligibility criteria for the program that favored natural gas-fueled power plants. Large-scale batteries, a rapidly emerging technology on the Texas grid, were prohibited from applying. The projects include proposed power plants from Irving-based Vistra Corp. as well as NRG and Calpine. The proposed sites are across Texas.