AEP Texas secures approval for North McAllen substation despite pushback — but it’s temporary

The city of McAllen recently approved a conditional use permit for an AEP Texas electrical substation that officials say will make the local grid more reliable during storms as demand for electricity continues to grow. 

The two-year permit is slated to expire in 2028 and is on city-owned property near Buddy Owens Boulevard and North Bentsen Road. 

McAllen denied the company’s previous proposal for a permanent electrical substation after a nearby community pushed back in August 2025. 

New plans include a temporary electrical substation on a platform on city owned land until AEP Texas secures its own property nearby. The temporary substation is still located near the subdivision where residents repeatedly advocated against the project.

A permanent substation is expected to be constructed along Buddy Owens, either near the intersection of Shary Road or Taylor Road, but the real estate deal is still under negotiation. 

Joey Maldonado, from AEP Texas’ real estate division, told the commission that the company is finalizing a deal for a permanent site, which could sit within McAllen city limits or in the city of Palmhurst next door. 

“We typically take about six months…to look at our due-diligence period — looking at title work to make sure the title is clear of any [liens] and then we also look at doing topography, geotech work, surveying, environmental. So we typically take about six months, and if need be, we can extend another six months,” Maldonado said.

AEP Texas did not respond to an interview request about the company’s plans for several more substations in McAllen. 

Joaquin “JJ” Zamora, McAllen commissioner for District 2, initially voted against the project but changed his mind after the company hosted an informational community meeting in late March 2026. 

“I also have to consider not just that neighborhood but the rest of everybody else that lives in that area,” Zamora said. 

But that doesn’t mean the commission is keen on extending its temporary approval, Zamora said.

“Two years, and that has to be it. If you can expedite the process to have that permanent location, even better,” he said. 

Daniel Lucio, the AEP Texas representative for the McAllen area, previously said it was critical to get the substation installed before the summer heat comes in — which can strain the grid with high demand. 

“If we get to the summer season and we have extraordinary temperatures, servicing that area could be a concern,” Lucio said. “I appreciate the concerns from residents, but I want to make sure that come the heat of the summer, our residents are receiving the service they need from their electric supplier.” 

AEP Texas serves 1.1 million customers, many of whom live in the Rio Grande Valley, but its service area also includes swaths of South, West, and East Texas. In 2024 alone, electricity demand from AEP Texas customers increased by 600 megawatts.