The South Korean government announced last week that it will invest $22.3 billion in a gas-fired power plant in Texas. This is the first investment project to come out of the $350-billion pledge that South Korea made in July 2025 as part of a trade deal with the United States.
About the power plant:
According to Bloomberg, the plant will be based in Encinal, Texas, about 118 miles southwest of San Antonio.
Commercial operations will begin in 2029.
NextEra Energy, Lewis Energy Group, and Related Companies Inc. will participate in the plant.
Detailed equity splits between the partners were not revealed.
The plant will have 6.3 gigawatts of total capacity, which will help meet growing energy demand from data centers.
The gas-fired power plant’s first phase will include 1.4 gigawatts. Later phases will total 4.9 gigawatts.
No customers for the power plant have been announced.
South Korea made the announcement ahead of the upcoming meeting between President Donald Trump and South Korea’s President Lee Jae Myung, who was attending the U.N. General Assembly in New York City.
According to Korean officials, the Texas power plant will generate revenue of $43—45 billion over 20 years, more than recovering the initial investment and interest.
Project background:
In October 2025, the South Korean government reached an agreement with the U.S. government to invest a total of $350 billion into projects in the United States.
South Korea’s annual investment in the United States will be capped at $20 billion, so as not to cause too much strain on Korea’s foreign currency reserves.
$150 billion will be used for shipbuilding with a collaboration hub based in Washington State.
The projects will include eight nuclear reactors and one LNG export project in Alaska.
In exchange, the Trump administration agreed to keep the tariff on Korean imports at 15 percent, rather than raising it to 25 percent.
Japan has made similar agreements with the Trump Administration, committing to invest $550 billion in the United States.
Korea was criticized for not having moved as fast as Japan.
In February, Japan agreed to invest in a $33-billion gas-fired power plant in Ohio.
In March, Japan also committed to invest $40 billion in small modular nuclear power plants in Tennessee and Alabama.
What they’re saying:
President Trump and South Korean President Lee Jae Myung “welcomed the significant progress made in discussions regarding strategic investment projects between the two nations,” said Wi Sung-lac, South Korea’s National Security Advisor, following the meeting between the two presidents in New York City.
The projects must be “commercially reasonable,” though “it’s ultimately the U.S.-led Investment Committee that decides what counts as ‘commercially reasonable,” said Haeyoon Kim of Korea’s Tech and Trade Watch.
What to watch:
The Texas power plant is awaiting U.S. government approval to progress.
Will the U.S. agree to help South Korea build nuclear-powered submarines?