El Paso Electric’s plan to build a $500 million power plant for the giant Meta Platforms data center complex under construction in Northeast El Paso has hit opposition.
The city of El Paso, the Texas Office of Public Utility Counsel, representing residential and small-commercial consumers and others, including two politicians, are opposing EPE’s plan filed with the Public Utility Commission of Texas. Texas Rio Grande Legal Aid also filed objections to the McCloud project on behalf of EPE customer Juan Vargas.
The city and Public Utility Commission’s arguments against the project are similar.
Consultants for both agencies listed several arguments against EPE’s plan in their filed testimony, including that EPE has not conducted the required analysis to determine whether the McCloud generation plant would benefit El Paso Electric’s customers. They also foresee customers eventually having to pay the costs of the power plant.
Hearing set on Meta power plant approval
A hearing via videoconference before a state administrative law judge is scheduled for July 8-9 on EPE’s application. The judge will issue a recommendation to the PUC’s five commissioners sometime after the hearing, who will ultimately decide whether to approve EPE’s application and what requirements to include.
City Attorney Karla Nieman said in a statement, “The City’s position is simple: El Paso ratepayers should not be paying for the costs or risks associated with serving a single large customer.”
El Paso Electric officials, in a statement, said, “We respectfully disagree with the opposition,” and “We look forward to addressing these concerns through the formal PUCT process.”
EPE officials filed testimony on Tuesday, June 23, with the PUCT rebutting opponents’ arguments.
Opposition to EPE projects not unusual
It’s not unusual for agencies, companies, and politicians to oppose El Paso Electric’s power plant proposals.
The city and others several years ago opposed EPE’s plan to expand the Newman power plant in Northeast El Paso. The PUCT eventually approved the utility’s plan over the opposition.
The proposed McCloud power plant will have 813 natural-gas-fueled generators placed in 168 rows to produce up to 366 megawatts of electricity, according to EPE’s December filing.
The Meta complex will eventually need 1 gigawatt, or 1,000 megawatts, of electricity — almost equal to the generation capacity of El Paso Electric’s largest power plant, the Newman Generating Station in Northeast El Paso. EPE will also need additional power sources for the Meta facility in the future.
Meta pays power plant costs for 5 years
Under EPE’s plan, Meta Platforms, which operates Facebook, Instagram and WhatsApp, would pay the costs of building and operating the power plant for its first five years of operation, when it’s not tied to EPE’s grid, according to EPE’s December 2025 application with the PUCT.
However, after the five-year “bridge period,” the plant is to be connected to EPE’s system, and the utility will seek to incorporate it into its rate structure, according to the filing.
The “rate and reliability impacts of the McCloud facility on service to existing customers over the remaining life of the facility have not been evaluated,” Scott Norwod, an Austin energy consultant for El Paso, stated in filed testimony.
Evan Evans, a former EPE executive and now an independent energy consultant based in Abilene, Texas, argued in a filing for the Office of Public Utility Counsel that the McCloud plant “would significantly increase costs to EPE’s customers if the costs (of the plant) are recovered from all of EPE’s customers.”
More: El Paso City Council rejects plan to cancel Meta data center deal
EPE official: Potential impact concerns not valid
James Schichtl, EPE vice president of regulatory strategy, said in filed testimony that since Meta has committed to pay for the power plant, “there is no valid basis for parties’ concerns about the potential impact on other customers.”
“That issue can and should be addressed by the Commission in a future case, if EPE asks to include McCloud in its generation resources and rates,” Schichtl said.
Norwood also argued that the construction and operating costs of the McCloud plant are “significantly higher than the estimated costs of new (more traditional) gas-fired combustion turbine” power plants. He pegged the cost of the McCloud project at $551.8 million, including $52 million in transmission interconnection costs.
Schichtl said Norwood’s cost estimates for gas-powered turbines are outdated, and the McCloud costs compare favorably with those of more traditional power plants.
EPE wants to begin construction of the plant in August and have it completed by May 2027, an unprecedentedly short timetable for an EPE power plant project. A power plant usually takes several years to build.
More: Houston firm aims to connect El Paso to Eastern U.S. power grid
Legislators, commissioners list concerns
El Paso County Commissioner David Stout and Texas state Rep. Mary Gonzalez, D-El Paso, also filed letters with the PUCT, asking it to deny EPE’s application.
U.S. Rep. Veronica Escobar, D-El Paso; state Sen. Cesar Blanco, D-El Paso; state Rep. Vince Perez, D-El Paso; and County Commissioner Iliana Holguin also filed letters with the PUCT expressing concerns about the proposed power plant.
All the politicians are concerned that the plant’s costs will be shifted to all EPE customers after the initial five-year period, during which Meta will be the exclusive customer for the power plant.
More: El Paso Electric by the numbers: 2025 sales up slightly, profit down
Why no solar for Meta data center?
Escobar noted that Meta officials initially made a verbal commitment to power the El Paso data center complex with solar power or other renewable energy. Gonzalez said if EPE must supply electricity to the complex, the power should come from renewable energy.
EPE’s Schichtl, in his testimony, said the McCloud plant is the only option that can be colocated with the data center and be operational in 2027.
EPE has met all Texas requirements needed for approval of the McCloud project, Schichtl said.
Vic Kolenc may be reached a915-546-6421; vkolenc@elpasotimes.com; @vickolenc on X, and @vkolenc.bsky.social on Bluesky
This article originally appeared on El Paso Times: City, others oppose El Paso Electric’s Meta power plant plan
Reporting by Vic Kolenc, El Paso Times / El Paso Times
USA TODAY Network via Reuters Connect
By Vic Kolenc, El Paso Times | USA TODAY Network
