NRG Energy has received a multimillion-dollar state loan to construct two natural gas units at its TH Wharton Power Plant in Northwest Houston. The units, designed to generate 456 megawatts of power, are expected to come online next summer and serve the Electric Reliability Council of Texas’ (ERCOT) Houston load zone.
The loan, provided through the Texas Energy Fund via the Public Utility Commission of Texas (PUCT), will cover up to $216 million, 60% of the project’s cost, at a 3% interest rate over 20 years. As part of the agreement, the new units must meet minimum performance standards.
NRG said the additional power will support growing electricity demand driven by artificial intelligence data centers and future residential developments.
“Demand for electricity across Texas is surging, and we're working quickly to supply new dispatchable natural gas generation to the grid,” said Robert J. Gaudette, NRG’s executive vice president and president of NRG Business and Wholesale Operations.
He added the project will provide jobs, enhance grid stability, and spur economic growth.
PUCT Chairman Thomas Gleeson highlighted the project’s role in strengthening Texas’ power supply.
“The Texas Energy Fund is accomplishing exactly what the governor and the Texas Legislature envisioned, securing reliable, on-demand power to fuel Texas' rapid growth and continued success,” Gleeson said.
Lawmakers established the Texas Energy Fund during the 2023 legislative session following the deadly 2021 winter storm that killed more than 210 Texans. The legislation reflects a shift toward natural gas–fueled electricity to increase grid reliability.
NRG’s loan is one of two Texas Energy Fund agreements, and together they will add 578 megawatts of power to the ERCOT grid.
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