New Gas Fired Power Coming to Texas
Last November, Texas voters said yes to a measure to bring more dispatchable energy to the Texas grid. The program is called the Texas Energy Fund (TEF). It offers financing to companies to build more natural gas burning power plants. Now, we are finally seeing some action with the program. In May, gas generator developers lined up for Texas energy funding. Let’s dig into this new development in Texas power.
Why We Want the Texas Energy Fund
This past November, Texans voted yes for the TEF with just shy of 65% of the vote. The strong support for the TEF comes from the issues in the state following Winter Storm Uri in February 2021. Many people faced long periods with no power in icy temps. Since then, improving the reliability of our grid has been a key target.
Both statehouse and grid officials behind the TEF believe more dispatchable natural gas fired generation is the way to do that. Intermittent power sources like solar or wind rely on weather to create power. On the other hand, natural gas power is ready to go at any time.
Why Developers Want the Texas Energy Fund
The TEF offers public financing for companies to build natural gas power plants. This saves companies money on interest compared to private financing. With the TEF, there is $5B up for grabs to get companies to their financing goals. Also, companies can finance up to 60% of their project. At the end of the day, developers lower their startup costs and set themselves up for long-term success as a Texas energy company.
How Texans Benefit from the TEF
May 31 marked the deadline for companies to file their intent to apply for the program. The state utility commission says it received 125 notices of intent. All totaled up, the notices represent 41 GW of new generation capacity. But the TEF certainly will not be able to finance all these projects. More specifically, the notices represent about $38.9B in requested funds while the TEF currently has only $5B to offer.
But rest assured, the funding will go to projects with at least 100 MW generating capacity. Furthermore, several large projects for dispatchable energy generation are already on the way in Texas. For a more reliable power grid, Texans took matters into their own hands and voted for the TEF. But remember, you have more power: the power to choose your electric provider. Check out the best electric plans at https://www.powerchoicetexas.org.