City Council authorizes ongoing negotiations to protect ratepayers from Meta data center energy facility

EL PASO, Texas (KVIA) -- Monday, the City of El Paso's City Council authorized the City Attorney, in consultation with the City Manager, to continue settlement negotiations and make a counteroffer for a "full hold harmless" for ratepayers from costs of the McCloud Generation facility.

During Monday’s City Council meeting, the City Attorney’s Office provided Council with an update on El Paso Electric's (EPE) application to construct the proposed 366-megawatt natural gas generation facility, which EPE proposes to use to serve Meta’s data center.

According to City officials, the judges also found that EPE did not adequately consider alternatives or demonstrate that the proposed McCloud Generation facility was the most cost-effective option.

The ALJ recommendation is not a final decision; the five Public Utility Commission of Texas (PUCT) commissioners will make the final decision on whether to accept, change, or reject the recommendation. The PUCT is expected to issue a final order by December 7, 2026.

The City says that in addition to protecting ratepayers from McCloud’s construction and operating costs, a “full hold harmless” would protect customers from other financial impacts, including the potential loss of revenue credits from EPE’s off-system power sales.