#United States #San Antonio #CPS Energy #PROENERGY #Texas Power

CPS Energy's Acquisition Strategy in Texas

On September 15, 2025, CPS Energy made a significant move by signing a definitive agreement with PROENERGY, enabling the acquisition of a power generation portfolio that boasts a total capacity of 1,632 megawatts (MW). This strategic transaction, worth approximately $1.387 billion, is set to close in the third quarter of 2025 and represents an important step in CPS Energy's commitment to meeting San Antonio's long-term energy requirements.

Overview of the Acquisition

The portfolio includes four natural gas power generation facilities located within the Electric Reliability Council of Texas (ERCOT) market, with new peaking plants in Harris, Brazoria, and Galveston Counties. Notably, these facilities are not only up-to-date but also equipped with dual-fuel capabilities. This feature will allow CPS Energy to eventually transition these plants to a hydrogen fuel blend, significantly reducing carbon emissions and furthering the company’s sustainability initiatives.

In conjunction with the acquisition of assets, CPS Energy has also finalized Operations and Maintenance (OM) and Total Care Services Agreements (TCSA) with PROENERGY. These agreements ensure that PROENERGY will not only maintain operational responsibilities but also guarantee the safe and reliable functioning of the power plants going forward.

Benefits to the Community

This acquisition aligns with CPS Energy's community-oriented approach and board-approved generation plan. By opting to acquire these operational assets in ERCOT, CPS Energy minimizes costs and mitigates risks associated with building new power generation facilities from scratch. As Rudy D. Garza, President and CEO of CPS Energy, articulated, leveraging existing technology in modern plants allows the company to avoid the inflationary cost pressures and lengthy timelines accompanying new construction.

The acquisition is anticipated to enhance the reliability and affordability of CPS Energy's power supply, securing immediate benefits for customers. Garza stated, “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 communities we serve.”

Strategic Implications for Future Energy Sources

CPS Energy’s forward-looking vision includes not only natural gas but also a diverse mix of energy sources such as solar, wind, and storage solutions. This holistic approach allows CPS Energy to respond effectively to the increasing energy demands of the community it serves, ensuring growth sustainability for the future.

The company continues to prioritize community engagement, focusing on job creation and economic development as important facets of its mission. With a history dating back to 1860, CPS Energy stands out as the largest public power and natural gas company in the U.S., committed to providing safe and reliable service to its customers while maintaining competitive pricing.

Conclusion

As the energy landscape evolves, CPS Energy's acquisition of this power generation portfolio not only reinforces its infrastructure but also exemplifies its dedication to serving the community's energy needs responsibly. The collaboration with PROENERGY is expected to pave the way for a more sustainable and efficient energy future in Texas, demonstrating that with innovation and strategic partnerships, substantial progress can be made toward achieving energy reliability and environmental sustainability.

With financial advisors from J.P. Morgan and legal counsel from Dykema Gossett PLLC assisting in this transaction, CPS Energy is poised to effectively integrate these assets to meet the increasing energy demands while adhering to its existing commitments to sustainability.