TotalEnergies has signed an agreement with TexGen, a U.S. based company providing Texas with energy, to acquire three gas-fired power plants in Texas with a combined capacity of 1.5 GW for $635 million as part of its development as an integrated power player.
The three plants belong to of the second-largest power market in the US, ERCOT (Electric Reliability Council of Texas), and include the following:
- The Wolf Hollow I plant with a 745 MW combined-cycle gas turbine (CCGT) plant on the outskirts of Dallas.
- The Colorado Bend I plant with a 530 MW CCGT and a 74 MW open-cycle gas turbine (OCGT), south of Houston, provides additional flexibility to meet exceptionally high demand, especially in the summer.
- The La Porte site with a 150 MW OCGT, southeast of Houston.
Situated near Dallas and Houston, these versatile assets will help meet the rapidly increasing energy needs of the major cities and help balance out the intermittent nature of renewable power generation. Their importance was recently highlighted by weather-related incidents that affected Texas’s ability to generate electricity from renewable resources or caused a high seasonal peak demand.
In addition to enhancing the current 2 GW gross installed, 2 GW under construction, and more than 3 GW under development of renewable capacity in Texas, TotalEnergies’ acquisition of 1.5 GW of additional flexible production capacity will strengthen its trading capabilities in the gas and power markets.
The 26 million ERCOT consumers in Texas will receive energy from TotalEnergies that is more readily available, reasonably priced, and sustainable due to this acquisition.
“We are delighted with the agreement signed with TexGen to acquire 1.5 GW of CCGT in ERCOT. After the signing of several corporate PPA over the last couple of years and the recent start-up of the utility-scale Myrtle solar plant, this deal is a major milestone for our Integrated Power strategy in the ERCOT market. These plants will enable us to complement our renewable assets, intermittent by nature, provide our customers with firm power, and take advantage of the volatility of electricity prices. This acquisition will contribute positively to our profitability target of 12% ROACE by 2028 for our Integrated Power business segment.”
Stephane Michel, President Gas Renewables & Power at TotalEnergies.
This transaction remains subject to approval by the relevant authorities.