Xcel Chooses 3.9 GW of Proposed Power Projects for Texas, New Mexico

Written by Paul Wiseman for IIR News Intelligence (Sugar Land, Texas)

Summary

Xcel Energy has chosen a wide range of new power projects in its latest proposed power portfolio for parts of Texas and New Mexico. The projects would come online by 2030.

Power to the People

Utility provider Xcel Energy, Incorporated announced last week a proposed portfolio of 3.928 gigawatts (GW) of new energy projects for its wholly-owned Southwestern Public Service Utility (SPS) subsidiary, which covers parts of west Texas, the Texas Panhandle and southeastern New Mexico. SPS serves approximately 410,000 customers and 96 communities in the two states.

The company's picks include wind, solar, a battery energy storage system (BESS), and a natural gas-fired power plant. SPS said the projects are expected to be online by 2030. That completion date was among the criteria for acceptance, the company said.

Industrial Info Resources is currently tracking nine active Xcel power generation-related projects in Texas and New Mexico, with a total investment value of $6.13 billion. Industrial Info Resources offers more information in its Global Market Intelligence (GMI) Power Project Database, where readers can find a list of detailed project reports.

The types of projects in the new proposed portfolio include "build-transfer, self-build, or Purchased Power Agreements (PPAs)." In "build-transfer," the contractor does the construction and then transfers the ownership to SPS. In "self-build," SPS hires the contractor to build the project under SPS' ownership. A PPA means the builder maintains ownership, being guaranteed a level of power purchase by SPS for a set term.

Part of the Plan

Current plans are step two towards implementing the company's 2023 New Mexico Integrated Resource Plan. That instrument outlined the company's generation fleet transition over a 20-year period. In addition to the noted new generation, the plan includes the closing of "aging gas steam generating units and coal-fired generation," according to the request for proposals (RFP).

Among the larger goals are to boost grid reliability by making sure there's enough BESS and gas-fired generation to supply peak needs to fill gaps left by the intermittency of wind and solar. SPS also sees the move toward renewables as removing the grid from the price volatility involved with fossil fuels.

Plans are to start work quickly to benefit from current market conditions and federal energy incentives that are still available.

Re-evaluation of Large Load Growth Brought about Phase II

The current RFP was the second phase of the SPS plan. A previous RFP, issued in July of 2024, had resulted in acceptance of a portfolio of 17 power projects to add 5,168 megawatts (MW) of new nameplate capacity by 2030. Also included were 521 MW of extensions to existing generation

After re-evaluating expected load growth--mainly from "highly probable expected new large commercial and industrial customer loads in the near term," the company said it determined the need for still more capacity by 2032, leading to an October 2025 follow-up that resulted in the latest proposed power portfolio.

That load growth has also led the company to declare that it wants the major users to "pay their own way" via proposed large load tariffs in Texas and New Mexico to require them to cover the necessary costs.

Projects in both portfolios are being reviewed by regulators in New Mexico and Texas.

Xcel's Service Area

Headquartered in Minneapolis, Xcel's companies generate and distribute electricity and gas to customers in Minnesota, Colorado, Wisconsin, Michigan, North Dakota, and South Dakota as well as New Mexico and Texas.

By the Numbers

• 3.9 GW: Amount of new load projects from SPS's most recent request for proposals (RFP)
• 5.7 GW: Total load addition projects from previous RFP accepted in 2025

Key Takeaway

• Reevaluation of large load demand prompted Southwestern Public Service Utility (SPS) to request a second round of new generation proposals in 2025 after accepting more than 5.7 GW of new capacity just a few months earlier.

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, Industrial Info Resources is tracking over 250,000 current and future projects worth $30.2 Trillion (USD).