Entergy Rides Natural Gas Generation, T&D to Higher Capital Spending

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Written by Danny Levin, Deputy Editor for IIR News (Sugar Land, Texas)

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Summary

With a focus on boosting its natural gas power generation capacity as well as transmission and distribution, Entergy has increased its respective four-year and 2026 capital plans to $43 billion and $11.6 billion. Industrial Info is tracking $28 billion worth of active and planned projects from Entergy, with natural gas generation and grassroot projects leading the way.

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Natural Gas Drives Entergy's Capital Plan

Entergy Corporation's recently announced four-year (2026-2029) capital plan of $43 billion is $2 billion higher than the previous plan, while its 2026 plan of $11.6 billion is up from $8 billion for last year.

In the power company's recent earnings conference call, Chief Executive Officer Drew Marsh said about half of last year's spending was devoted to generation, while about $3.5 billion went toward energy delivery--which includes transmission and distribution (T&D).

Meanwhile, according to the earnings presentation, $15 billion of the planned new four-year spend is attributed to "new generation" (primarily natural gas and nuclear power), while $17 billion is earmarked for T&D. The remaining amount includes $6 billion for solar and storage, while $4 billion is for "generation baseline." The latter involves maintaining, modernizing and upgrading the existing fleet.

"With a $43 billion capital plan through 2029 to support customer needs, we have a sizable build cycle ahead," Marsh said in the call. He added the $8 billion in 2025 capital expenditures (capex) included "significant work on Orange County Advanced Power Station, which is entering the final stages ahead of a summer in-service date, and Delta Blues in Mississippi. Looking ahead, new generation is a big part of our customer-centric plan."

The 1,200+-megawatt (MW) Orange County Advanced Power Station in Texas and 754-MW Delta Blues plants are each designed to primarily run on natural gas, with the ability to blend hydrogen. Industrial Info is tracking Delta Blues with a planned completion date in late 2027. Subscribers to Industrial Info's Global Market Intelligence (GMI) Project and Plant databases can read more information in the related project reports and plant profiles.

Also, according to the presentation, 11 natural gas units will enter service by the end of 2029, while another three are pending regulatory review. Marsh added more context in the call, noting several projects, including Franklin Farms units 1 and 2 in Louisiana, are "in early stages that will come online in the next few years." Subscribers can view a full list of the company's active and proposed natural gas-generation projects being tracked by Industrial Info.

Entergy also is developing its renewable resources such as solar and storage, albeit on a smaller scale than natural gas.

He said Entergy has five owned and contracted solar resources "approved or in progress," totaling 740 MW. Ultimately, gas, solar and storage account for nearly 9 gigawatts (GW) approved and under construction toward the company's planned 13 GW of new capacity over the next four years.

Still Focused on T&D

But transmission and distribution (T&D) accounts for $17 billion of the four-year, $43 billion capital plan.

Marsh said this includes new construction on more than 570 miles of 500-kilovolt (kV) lines and 175 miles of other transmission lines, as well as investment in new substations.

Entergy produces, transmits and distributes electricity to serve 3.1 million customers across its utility subsidiaries in Arkansas, Louisiana, Mississippi and Texas.

Underway is the construction of a new substation and eight 230-kilovolt (kV) overhead transmission lines that will support Meta Platforms Incorporated's Project Hyperion artificial intelligence data center campus in Richland Parish, Louisiana. The aforementioned Franklin Farms units are expected to power the campus, which has an initial goal of 2 gigawatts (GW) by 2030 and a final capacity of 5 GW.

Industrial Info is tracking the data center construction and power infrastructure projects and plants under the Hyperion Data Center & Transmission Line umbrella project.

Data Centers Drive Power Demand

"Our pipeline is unchanged at 7-12 gigawatts for data centers and 3-5 gigawatts for other industries," Marsh said. "We have clear line of sight on equipment to serve 8 gigawatts of incremental load above our current plan."

Addressing potential effects to ratepayer costs, he said the company's long-term data center contracts include "early termination penalties and minimum bills to ensure that other customers aren't left to pay for investments needed as a result of adding large loads to the system."

Earnings Results and Outlook

Also in the call, Chief Financial Officer Kimberly Fontan reiterated that data centers would boost company growth. "Off of 2025 weather-adjusted results, we expect 8% retail sales compound annual growth, driven by 15% industrial growth through 2029. Data centers are the primary driver, along with growth from a variety of traditional Gulf South industries, including transportation or LNG [liquefied natural gas], primary metals, industrial gases, petrochemicals, and agricultural chemicals."

"As a reminder, we take a conservative approach with hyperscale data centers. We only include them in our plan once we have an ESA [electric service agreement] in place."

Entergy reported full-year 2025 net income of $1.75 billion on an as-reported and adjusted basis, up from $1 billion and $1.57 billion in 2024 for each category. Fourth-quarter income of $236 million on an as-reported and adjusted basis was down from roughly $290 million year-over-year.

Industrial Info is tracking $28 billion worth of active and proposed projects from Entergy. Subscribers can view a full list of detailed project reports.

Key Takeaways

• Entergy estimates four-year and 2026 capital plans of $43 billion and $11.6 billion, respectively.
• That investment will focus mainly on natural gas generation and T&D.
• Like many other energy companies, Entergy expects data centers to be a major driver for demand and potential sales growth.

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About IIR News Intelligence
IIR News Intelligence is a trusted source of news for the industrial process and energy markets, powered by Industrial Info Resources' Global Market Intelligence (GMI).

About Industrial Info Resources
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 250,000 current and future projects worth $30.2 Trillion (USD).