CPS Energy invests $1.4B in Houston hydrogen-ready power plants

San Antonio-based CPS Energy has acquired four Houston-area power plants that are dual-fuel capable. Photo via Getty Images.

CPS Energy, which services San Antonio, has agreed to acquire four state-of-the-art natural gas power generation facilities in the Houston area from Missouri-based PROENERGY for $1.387 billion, according to a release.

The recently constructed plants have an aggregate electric capacity of 1,632 megawatts and are located in the Electric Reliability Council of Texas (ERCOT) markets in Harris, Brazoria and Galveston counties. The assets are dual-fuel capable, which would allow CPS Energy to transition to a hydrogen fuel blend and reduce carbon emissions.

CPS president and CEO Rudy Garza said that the acquisition presents a lower cost and lower supply chain risk alternative to building new power facilities while providing reliable, affordable and cleaner energy.

“We are getting the best of both worlds by securing new infrastructure without delay while also strengthening the power supply for our community,” Garza said in a news release. “This acquisition secures reliable capacity today – at a lower cost – and is a win for the customers of CPS Energy, the city of San Antonio and all the communities we serve by meeting their long-term energy needs. As we add resources to meet the needs of our fast-growing communities, we will continue to look to a diverse balance of energy sources that complement our portfolio, including natural gas, solar, wind, and storage, keeping our community powered and growing.”

PROENERGY will continue to staff, operate, and maintain the plants.

“By acquiring recently constructed, currently operating modern power plants that utilize proven technology already in use by CPS Energy, we avoid higher construction costs, inflationary risk, and long timelines associated with building new facilities – while also enhancing the reliability and affordability of the CPS Energy generation portfolio,” Garza added in the release.

CPS Energy is one of the nation’s largest public power, natural gas, and electric companies with 950,000 electric and 389,000 natural gas customers in the San Antonio area and surrounding counties.

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A View From HETI

A new report predicts solar power supplied to the ERCOT grid will jump by 89 percent by the end of 2027. Photo by Red Zeppelin/Pexels

Much of the country’s growth in utility-scale solar power generation will happen in the grid operated by the Electric Reliability Council of Texas (ERCOT), according to a new forecast.

The U.S. Energy Information Administration (EIA) predicts that solar power supplied to the ERCOT grid will jump from 56 billion kilowatt-hours in 2025 to 106 billion kilowatt-hours by the end of 2027. That would be an increase of 89 percent.

In tandem with the rapid embrace of solar power, EIA anticipates battery storage capacity for ERCOT will expand from 15 gigawatts in 2025 to 37 gigawatts by the end of 2027, or 147 percent.

EIA expects utility-scale solar to be the country’s fastest-growing source of power generation from 2025 to 2027. It anticipates that this source will climb from 290 billion kilowatt-hours last year to 424 billion kilowatt-hours next year, or 46 percent.

Based on EIA’s projections, ERCOT’s territory would account for one-fourth of the country’s utility-scale solar power generation by the end of next year.

“Solar power and energy storage are the fastest-growing grid technologies in Texas, and can be deployed more quickly than any other generation resource,” according to the Texas Solar + Storage Association. “In the wholesale market, solar and storage are increasing grid reliability, delivering consumer affordability, and driving tax revenue and income streams into rural Texas.”

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