The Public Utility Commission of Texas on June 23 entered into the fifth agreement under the Texas Energy Fund (TxEF) Completion Bonus Grant (CBG) Program, with Tejas Power Generation, LLC, a subsidiary of Shell Energy North America (US) L.P.
The grant is for the company’s 146-megawatt expansion to the Friendswood Energy Center in southwest Houston.
The expansion at Friendswood Energy Center, a natural gas-fired combustion turbine facility, builds on the site’s existing capacity to provide additional dispatchable energy to respond to Texas’ increasing electrical demand, including during extreme weather conditions, the PUC said.
The expanded facility connected to ERCOT’s Houston Load Zone on May 21, 2026. Under this agreement, Tejas Power Generation can receive a maximum total grant award of $17.52 million, in annual payments up to $1.75 million per year, over a 10-year period.
Qualifying electric generation projects that will supply power to the Electric Reliability Council of Texas (ERCOT) grid before June 1, 2029, are eligible for CBG grants.
Payments are contingent upon the new unit’s performance. ERCOT will measure performance over an annual “test period” and compare it to the performance of a reference group of non-grant recipient generation resources in the ERCOT region.
Friendswood Energy Center’s first test period runs from June 1, 2026, through May 31, 2027, after which Tejas Power Generation may receive its first grant payment. Performance metrics are outlined in the PUCT’s CBG Program rule.
The TxEF CBG Program is one of four TxEF programs.
