Entergy's $1.8B Texas Gas Plant Deal Faces Growing Doubt
Entergy CEO Drew Marsh told analysts the company is looking for ways to “mitigate the impact” of its proposed $1.8 billion purchase of the 1.26-GW Cottonwood gas plant in Texas, Utility Dive reports. The deal, pending approval from the Louisiana Public Service Commission, has drawn scrutiny after a June PSC staff analysis found it could add up to $7 to the monthly bill of a customer using 1,000 kWh. Jefferies analyst Julien Dumoulin-Smith called the deal “increasingly in doubt” in a Wednesday report, questioning whether Entergy can line up an additional customer to offset the bill impact. Marsh defended the purchase as necessary to serve steel mills, LNG facilities, and petrochemical plants growing in Louisiana, not just data centers. Entergy hopes to close the Atlas Holdings deal by the first quarter of 2026. The company’s capital investment plan remains unchanged at $67 billion, and its data center pipeline holds steady at 7-12 GW.
What It Means for Subcontractors
- Mechanical and E&I subs anticipating work tied to Cottonwood should hold off on staffing plans until the Louisiana PSC rules on the purchase; a Q1 2026 close date is Entergy’s target, not a certainty given analyst doubts.
- Firms bidding gas-plant construction packages in Texas and Louisiana should note Entergy’s own comparison: buying an existing asset like Cottonwood was framed as cheaper and faster than building new, a signal that greenfield gas-plant EPC work may face more competition from acquisition deals in this market.
- Subs tied to data center buildouts in Entergy’s service territory should track the Meta arrangement specifically, since Meta’s cost-sharing terms (a reported $2.65 billion in customer savings over 20 years) could become a template regulators expect on future large-load projects.
