Constellation Completes Sale of Brazos Valley Energy Center to LS Power
Constellation (Nasdaq: CEG) has completed the sale of the Brazos Valley Energy Center to LS Power, marking another step in the company’s efforts to fulfill regulatory commitments associated with its acquisition of Calpine. The transaction involves a 606-megawatt (MW) natural gas-fired combined-cycle power generation facility located outside Houston, Texas, which operates within the Electric Reliability Council of Texas (ERCOT) electricity market.
The completed divestiture forms part of a broader set of asset sales agreed to by Constellation in connection with its acquisition of Calpine, which closed in January 2026. The regulatory commitments were established to address competition-related concerns associated with combining the two energy businesses. By transferring selected generation assets to LS Power, Constellation is progressing toward meeting the requirements associated with the transaction.
Constellation originally entered into an agreement to sell the Brazos Valley Energy Center to LS Power in August 2026. The company disclosed the planned transaction in its second-quarter 2026 financial results, providing an update on its ongoing portfolio adjustments following the Calpine acquisition. Completion of the sale now advances the company’s broader divestiture program.
The Brazos Valley facility is a natural gas-fired combined-cycle power plant with a generating capacity of 606 MW. Combined-cycle plants use gas turbines to generate electricity and capture heat from their exhaust to produce additional power through a steam turbine. This configuration enables the facility to generate electricity using the energy from natural gas more efficiently than a conventional simple-cycle gas turbine operating alone.
Located near Houston, the facility participates in the ERCOT market, which manages electricity transmission and wholesale power market operations across most of Texas. Power generators operating in ERCOT contribute to meeting electricity demand from residential, commercial and industrial customers throughout the region. Natural gas-fired generation remains an important component of the Texas electricity supply, providing dispatchable capacity that can support grid operations as demand and renewable generation fluctuate.
The transfer of Brazos Valley to LS Power is one component of a wider agreement involving Constellation and U.S. regulatory authorities. In March 2026, Constellation announced a separate agreement to sell approximately 4.4 gigawatts of predominantly natural gas-fired generation assets located in Delaware and Pennsylvania to LS Power. Those facilities operate within the PJM Interconnection regional electricity market.
The planned PJM divestiture includes the Bethlehem, York 1, York 2, Hay Road and Edge Moor generation facilities. Together, these assets represent a substantial portion of the generation capacity identified for transfer under the agreement. Constellation has indicated that the sale is expected to close by the end of 2026, subject to customary closing conditions.
Unlike the completed Brazos Valley transaction, the PJM asset sale remains subject to the requirements necessary to finalize the transfer. The completion process will depend on satisfying applicable closing conditions and other transaction-related requirements. The planned disposition demonstrates the scale of the portfolio changes Constellation is undertaking to address regulatory obligations following its acquisition of Calpine.
The U.S. Department of Justice played a central role in the regulatory resolution associated with the acquisition. The divestiture commitments formed part of the agreement intended to address competition concerns arising from the combination of the companies’ electricity generation and retail energy operations. Transferring selected assets to another energy market participant is intended to address those concerns while allowing the broader acquisition to proceed.
Constellation completed its acquisition of Calpine on January 7, 2026. The transaction significantly expanded the company’s electricity generation portfolio and competitive retail energy business, establishing a substantially larger presence across multiple U.S. electricity markets. The combined business brought together generation resources and customer-facing energy operations, increasing the company’s scale across the power industry.
The acquisition also strengthened Constellation’s position in the U.S. energy sector at a time when electricity demand, power system reliability and generation investment remain important industry considerations. A larger generation portfolio can provide opportunities to serve different customer segments and participate across regional wholesale electricity markets. However, the regulatory commitments accompanying the acquisition require Constellation to adjust certain parts of that expanded portfolio.
The sale of Brazos Valley illustrates how the company is implementing those commitments through transactions with LS Power. Rather than retaining all the generation facilities included in the original combined portfolio, Constellation is transferring selected assets to satisfy the conditions associated with regulatory approval. The additional planned sale of the PJM facilities represents a further stage in that process.
For LS Power, the acquisition of the Brazos Valley Energy Center adds a 606-MW natural gas-fired generation facility operating in the ERCOT market. The company’s agreement to purchase the additional generation assets in Delaware and Pennsylvania would also expand its portfolio in the PJM region once that transaction is completed. These transactions reflect the continued movement of generation assets between major participants in the U.S. power industry.
The transactions also highlight the role of regulatory review in shaping the structure of large energy-sector acquisitions. When companies combine substantial generation portfolios, authorities may require asset divestitures to address potential competition concerns. The resulting sales can change ownership patterns across regional electricity markets while allowing approved acquisitions to move forward under agreed conditions.
With the Brazos Valley Energy Center sale now complete, Constellation has advanced one of the principal asset transfers associated with its Calpine acquisition. Attention now turns to the remaining divestiture commitments, including the planned transfer of approximately 4.4 GW of generation capacity in Delaware and Pennsylvania.
Constellation’s acquisition of Calpine has reshaped its generation portfolio and competitive retail operations, while the associated regulatory agreement has established a framework for selected asset sales. Completion of the Brazos Valley transaction marks measurable progress in that process. The expected closing of the remaining PJM asset sale by the end of 2026, subject to customary conditions, represents the next major milestone in fulfilling the company’s commitments to U.S. regulators.
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