A Texas-based power producer has broken ground on a new natural gas-fired power plant that is part of the state’s plan to increase its supply of dispatchable electricity.
Rayburn Electric Cooperative on June 9 began construction of the 570-MW Rayburn Electric Station II, adjacent to the existing 758-MW Rayburn Electric Station located on the company’s campus in Sherman, Texas. Utility officials said the new power station is expected to enter commercial operation in June 2028.
The new plant will feed power to the Electric Reliability Council of Texas’ (ERCOT) north load zone in North Texas. Rayburn II is designed as a peaker plant with the ability to ramp to full power within 10 minutes during periods of high demand for electricity.
“It’ll be great for those periods of time where we need that extra kick, or where the sun is setting and the solar is dropping off, the wind hasn’t quite picked up … those little gaps in this system,” said David Naylor, Rayburn’s president and CEO.
Support From Energy Fund
Rayburn II is the seventh project supported by the Texas Energy Fund, a loan program created by state legislators in 2023 to incentivize energy producers to build new power plants. The funding scheme was a response to Winter Storm Uri in February 2021, a major ice and snowstorm that left millions of Texans without power and resulted in the deaths of more than 200 people. Rayburn acquired the existing Rayburn Electric Station after that storm.
“This [Rayburn II] project will create redundancy in the system, not only for the 625,000 customers that Rayburn Energy already provides power to, but to the future growth and, of course, for the entire grid,” said Shawn Teamann, mayor of Sherman.
Rayburn officials on Tuesday said the new plant’s total cost is expected to be less than $685 million. About 60% of the cost will be backed by a 20-year loan, with a 3% interest rate, from the Public Utility Commission of Texas. The loan is part of the Texas Energy Fund’s In-ERCOT Generation Loan Program. Naylor said the remaining 40% of the new facility’s cost has been financed through the sale of bonds to investors.
Rayburn announced the execution of the loan agreement with the state last week. At the time, Christian Nagel, senior director of Power Supply and Production at Rayburn, said, “We are deeply grateful to the Public Utility Commission and the Texas Energy Fund program for selecting Rayburn for this opportunity. Being chosen is a recognition that the infrastructure we are building here is critically needed. Getting to this moment is a direct reflection of the preparation and commitment everyone at Rayburn brought to this effort, and we are proud of what this project means for the communities we serve.”
The Texas governor’s office in a statement said six applications for new generation that would add more than 3 GW of capacity to the state’s grid are pending a due diligence review. Those proposed facilities are in addition to the seven whose loans already have been approved through the state funding program.
—Darrell Proctor is a senior editor for POWER.
