Governor Greg Abbott has announced a new Texas Energy Fund (TxEF) loan agreement to support the construction of a 460 megawatt (MW) natural gas power plant in Fairfield, Texas. The facility will be built by Calpine Corporation and is expected to begin generating electricity for the Electric Reliability Council of Texas (ERCOT) region before summer 2026.
Governor Abbott stated, “Texans across our great state are benefiting from the reliable, affordable power that the Texas Energy Fund is helping add to the state grid, with hundreds of megawatts coming online. This 460 MW investment will further grow our power supply and keep prices affordable for homes and businesses in North Texas. We will ensure continued reliability for all Texans as we add more power and fortify the state grid.”
Public Utility Commission of Texas (PUC) Chairman Thomas Gleeson commented on the broader impact of the fund: “The Texas Energy Fund has now brought nearly 1,800 megawatts of new, reliable power generation to the state of Texas – and there’s more on the way. We are investing in the future of every region of our state and strengthening the foundation for continued electric reliability and growth.”
Calpine Executive Vice President of Commercial Operations Caleb Stephenson said, “Calpine is proud to demonstrate our commitment to Texas with our new Pin Oak Creek Energy Center in Freestone County. This 460-megawatt, state-of-the-art facility is designed to start within minutes and will deliver safe, reliable power exactly when Texans need it most. We’re grateful for the leadership of Governor Abbott and the Texas Legislature and for their dedication to keeping energy reliable and affordable for all Texans. Calpine is excited to keep investing in Texas to support our growing communities.”
The agreement between PUC and Calpine marks the fourth finalized loan under TxEF’s In-ERCOT Generation Loan Program. The program provides low-interest loans aimed at adding new dispatchable power sources within ERCOT’s service area. The total cost for this project is estimated at $464 million, with PUC providing a 20-year loan covering $278.3 million—about 60% of total costs—at a 3% interest rate from October 13, 2025 through October 13, 2045.
The new facility is being constructed next to Calpine’s existing Freestone Energy Center in Freestone County and will connect into ERCOT’s North Load Zone, which serves areas including Dallas-Fort Worth.
As part of its terms, the facility must meet minimum performance standards set by In-ERCOT Generation Loan Program rules. The TxEF itself is managed by PUC through a competitive application process involving detailed financial review.
Currently, there are thirteen additional applications under review for potential funding through TxEF’s In-ERCOT Generation Loan Program. If approved, these projects could bring an extra 7,211 MW of dispatchable generation capacity to ERCOT’s grid.
More details about TxEF and its programs can be found on the PUC website.
