Residential Users Set to Pay for ‘Grid Strengthening Plan’
November 2, 2025 – The Texas Public Policy Foundation (TPPF) is sounding the alarm over a massive statewide transmission line initiative it says could raise energy costs for Texans for years without proper oversight or approval.
“The cost burden is being unfairly shifted to ordinary consumers, rather than large industrial users and data companies that stand to benefit most.”
Originally pitched as a regional grid-strengthening plan, the Texas 765-kilovolt (kV) Strategic Transmission Expansion Plan (STEP) has since evolved into a multibillion-dollar statewide project led by the Electric Reliability Council of Texas (ERCOT). Approved by the Public Utility Commission of Texas (PUCT) in April 2025, the project adds three 765kV Extra-High Voltage (EHV) lines in the Permian Basin and two more lines linking Texas’ western and eastern grid loops.
In a September letter to the PUCT, the TPPF urged regulators to halt the project’s eastern portion, citing the absence of public hearings and legislative consent. “Decisions with high-level policy tradeoffs should not be left to ERCOT alone,” the group wrote, calling the move “unprecedented.”
Critics argue the plan echoes the 2005 Competitive Renewable Energy Zones (CREZ) project, which has cost Texans roughly $650 million annually in ongoing expenses. The TPPF warns that the STEP project could exceed those costs, potentially adding more than $200 a year to the average residential bill—nearly a 50 percent increase from current rates.
Supporters say the upgrade is essential to connect new renewable energy projects and to serve the rapidly expanding network of data centers that rely heavily on stable power. Data centers, which can consume as much electricity as small cities, have surged across Texas, intensifying pressure on the grid and increasing transmission demand.
Still, the TPPF contends that the cost burden is being unfairly shifted to ordinary consumers, rather than large industrial users and data companies that stand to benefit most. The foundation is urging lawmakers to revisit ERCOT’s cost-allocation methods before construction begins, warning that without reform, the STEP project could “lock in a new era of energy austerity” for Texas households.
