AEP Texas has entered into an agreement with the U.S. Department of Energy's Office of Energy Dominance Financing for a loan of up to $3.26 billion to support transmission infrastructure investments aimed at improving grid resiliency and reliability while delivering an estimated $685 million in customer savings over the next 30 years.

According to the utility, the financing will support a portfolio of nearly 100 projects designed to strengthen the electric grid and accommodate continued growth across its South and West Texas service territory. AEP Texas has signed letters of agreement supporting up to 41 GW of potential new load additions through 2030.

The utility plans to use the loan proceeds to rebuild or reconductor existing transmission lines and construct new transmission lines spanning approximately 2,800 miles. The projects are expected to increase the capacity of existing transmission infrastructure while reducing power interruptions for customers.

"Texas is poised for incredible growth over the next five years," said Adrian Rodriguez, president and chief operating officer of AEP Texas, in a statement. "AEP Texas is committed to enabling this opportunity, while leveraging resources to deliver future savings for our customers. This loan supports critical updates to our transmission infrastructure to strengthen reliability, connect new load and generation resources and manage affordability."

The loan is part of American Electric Power's broader strategy across its 11-state service territory to secure federal funding that helps reduce customer costs while supporting system growth and investments in grid reliability and resiliency.

AEP Texas serves more than one million customers across nearly 100,000 square miles in South and West Texas.