Sign up for The Brief, The Texas Tribune's daily newsletter that keeps readers up to date on the most important news in Texas.

The state of Texas plans to double state funding for power grid expansion as electricity demand is expected to nearly double over the next six years.

The state will seek to increase the Texas Energy Fund from $5 billion to $10 billion, Gov. Greg Abbott and Lt. Gov. Dan Patrick announced Monday. The fund was approved by voters in November 2023 to offer low-interest loans to encourage the construction of new gas-fired power plants.

The announcement comes shortly after a new forecast from the state's main grid operator that predicts electricity demand will increase sharply in the coming years. The Electric Reliability Council of Texas estimates that by 2030, the state's main power grid will need to supply nearly twice the amount of electricity it currently supplies.

The numbers in the new forecast, Abbott and Patrick said in a press release, “require an immediate review of all policies affecting the power grid.”

The state's power grid came under intense public and legislative scrutiny after a 2021 winter storm crippled its operations and caused days-long blackouts across the state in freezing temperatures that left millions of Texans without light or heat. Hundreds died.

The Texas Energy Fund has provided $5 billion in 3% interest loans to support the construction of new, all-weather gas-fired power plants that could provide electricity to 20,000 homes or more.

The fund will also pay bonuses to companies that connect new gas-fired power plants to the public power grid by June 2029. It will also provide grants for modernizing, weatherizing and controlling vegetation growth around Texas's power infrastructure outside the mainstream electricity market, which supplies about 90 percent of the state's electricity needs.

The state has received letters of intent to apply for $39 billion in loans – nearly eight times more than originally planned, Abbott and Patrick said. They added that the average power plant will take three to four years to complete and new transmission lines will take three to six years to complete.

Companies have until July 27 to apply for a loan.

Just in: Former US Representative Liz CheneyR-Wyoming; U.S. Senator. John FettermanD-Pennsylvania; and Governor of Oklahoma. Kevin Stitt will take the stage at the Texas Tribune Festival in downtown Austin September 5-7. Buy tickets today!