01—Abstract
Summary
Summary of the 8-K filed December 11, 2025. Cited figures are marked; the original filing is the authoritative source.
Entergy Texas, Inc. (a subsidiary of Entergy Corporation) has entered into a series of material definitive agreements related to the construction and leasing of a new 754-megawatt combined cycle gas power plant, the Legend Power Station, located in Jefferson County, Texas.
These agreements, with BA Leasing BSC, LLC ("BAL") as Lessor, involve a Participation Agreement for construction funding, a Construction Agency Agreement where Entergy Texas will manage the construction, and a Lease Agreement. The total expected construction costs are capped at $1.450 billiona. This transaction allows Entergy Texas to secure a significant new power generation asset while managing upfront capital expenditure through a lease financing structure.
Upon completion, Entergy Texas will lease the facility from BAL for an initial term of up to approximately 58 months, during which it will be responsible for operating costs and rent payments. The agreements also provide Entergy Texas with an option to purchase the facility early and outline end-of-lease options, including extending the lease or purchasing the property. Key covenants include a consolidated debt ratio limitation for Entergy Texas and specific conditions that could lead to acceleration or termination of rights.
02—Key points
Key Highlights
- Entergy Texas is proceeding with the construction of a new 754 MW combined cycle gas power plant, Legend Power Station, in Jefferson County, Texas.
- The project's construction costs are expected to not exceed $1.450 billion.
- A lease financing structure is being employed, with BA Leasing BSC, LLC acting as Lessor.
- Entergy Texas will act as the Construction Agent, managing the design, construction, and development of the facility.
- The facility will be leased back to Entergy Texas for an initial term of up to 58 months, with Entergy Texas responsible for rent and operating costs.
- Entergy Texas has an option to purchase the facility during the lease term, with financing provided by the Participants if exercised early.
- The agreements include customary covenants, such as a requirement for Entergy Texas to maintain a consolidated debt ratio of 65% or less of its total capitalization.
03—Questions
Frequently Asked Questions
What is the primary purpose of these new agreements for Entergy Texas?
The primary purpose is to facilitate the construction and financing of a new 754-megawatt combined cycle gas power plant, the Legend Power Station. Entergy Texas will manage the construction and then lease the facility, managing capital expenditure through a lease financing structure rather than direct ownership during the initial construction and lease phases.
What is the total estimated cost for the Legend Power Station project?
The costs of construction of the Facility funded under the Participation Agreement are expected not to exceed $1.450 billion.
What are Entergy Texas's obligations under the lease agreement?
During the lease term (up to approximately 58 months initially), Entergy Texas will make rent payments for yield incurred on the Lease Balance. Additionally, Entergy Texas will be responsible for all operating costs, including insurance, taxes, utility costs, and any costs related to repairs and modifications of the facility.
Does Entergy Texas have the option to own the power plant?
Yes, Entergy Texas has an option to purchase the facility at any time following the commencement of the Lease. The purchase price would be approximately equal to the Lease Balance plus accrued rent and other associated costs. If this option is exercised before the second anniversary of the lease commencement, the purchase will be financed by the Participants via a secured, non-amortizing note.
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