Xcel Energy has announced a significant expansion of its power generation portfolio to address the rapidly growing energy demand in Texas and New Mexico. This comprehensive plan includes enhancing 521 megawatts (MW) of existing generation and introducing 17 new power projects, which will collectively add 5,168 MW of new nameplate capacity to the regional grid by 2030. The additions are strategically designed to ensure long-term system reliability, economic growth, and a robust energy supply, incorporating 3,200 MW of dispatchable generation and energy storage, along with 1,968 MW of new wind and solar capacity.
Electricity demand in the region is projected to rise by over 40% by 2030 due to rapid population growth, industrial development, and broader electrification trends. In response, Xcel Energy has aligned its resource planning with the latest requirements from the Southwest Power Pool, which now mandates utilities to maintain greater capacity to meet increasing seasonal demand.
To tackle this challenge, Xcel Energy conducted an open solicitation in 2024, inviting developers to submit project proposals using any energy technology. The competitive process yielded a diversified portfolio that includes a mix of wind, solar, battery storage, and natural gas-powered generation.
The projects will be delivered through various development models—some will be constructed and owned by Xcel Energy, others will be built by third-party developers and transferred to Xcel, while several projects will operate under long-term power purchase agreements. Additionally, the portfolio extends the operational lives of existing natural gas plants at Nichols, Maddox, and Plant X, enhancing reliability and optimizing overall costs.
Adrian Rodriguez, president of Xcel Energy – Texas, New Mexico, stated, “This portfolio is about more than just adding power. We are working to increase speed to market with a stronger, modern, and more resilient energy system that our customers can count on. We’re investing in the right mix of resources to benefit customers by keeping electricity reliable and supporting economic growth so we can meet our region’s energy needs today and in the future.”
This generation expansion supports Xcel Energy’s broader five-year investment plan for Texas and New Mexico, announced in October 2024, which aims to modernize and expand regional energy infrastructure. Many new projects will be located at existing power plant sites, allowing the company to leverage current infrastructure, reduce development timelines, and lower customer costs. This approach also fosters continued investment in local communities where Xcel Energy operates.
The projects are expected to deliver significant economic benefits in both states. In New Mexico, a third-party analysis estimates that the plan could generate up to $5 billion in economic impact over the next five years, driven by the expansion of the oil and gas industry and increased electrification. In Texas, the new generation capacity will help meet rapidly growing demand in the Panhandle and other high-growth areas while supporting job creation, tax revenue, and infrastructure development in both rural and urban communities.
To support New Mexico’s renewable energy goals, the portfolio also includes two dedicated solar projects that will serve customers in the state and help meet the legislative target of 50% renewable energy by 2030. Xcel Energy plans to seek regulatory approval for the portfolio in the second half of 2025. Motivated by the strong interest received during its recent solicitation, the company also intends to issue another all-source request for proposals to bring additional new resources online by 2032 to meet customer needs and support regional business expansion.
Source: Xcel Energy
