Texas Energy Security and Power Act of 2026

A BILL
relating to the promotion and expansion of natural gas and advanced nuclear energy in Texas, the strengthening of the ERCOT electric grid against threats, and the encouragement of public-private partnerships with energy-intensive businesses; providing for streamlined permitting, targeted financial tools, grid security measures, and related matters.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. This Act shall be known and may be cited as the Texas Energy Security and Power Act of 2026.

SECTION 2. Legislative Findings and Purpose.
The Legislature of the State of Texas finds and declares the following:
(1) Texas is blessed with vast natural gas resources and has the potential to become a national leader in advanced nuclear technologies, including small modular reactors;
(2) Reliable, dispatchable electric generation from natural gas and nuclear sources is critical to meeting the rapidly growing power demands of Texas families, businesses, manufacturers, and data centers while keeping electricity affordable;
(3) The ERCOT grid must be protected from extreme weather, cyberattacks, physical sabotage, and supply chain vulnerabilities to ensure the lights stay on and the economy continues to grow;
(4) Voluntary cooperation between the State of Texas and corporate partners seeking large amounts of reliable power will bring private investment into new generation projects, create thousands of high-paying jobs, and stimulate economic development across the state; and
(5) These goals can and should be achieved through regulatory reform, targeted incentives funded by revolving accounts and existing revenues, and market-driven partnerships without imposing new taxes or unsustainable spending on Texas taxpayers.

The purpose of this Act is to remove unnecessary barriers, accelerate the build-out of natural gas and nuclear power, harden the ERCOT grid, and forge smart public-private partnerships that put Texas energy to work for Texas prosperity.

SECTION 3. Streamlined Permitting for Dispatchable Energy Projects.
(a) The Railroad Commission of Texas, the Texas Commission on Environmental Quality, and the Public Utility Commission of Texas shall, within 60 days of the effective date of this Act, adopt rules establishing a maximum 90-day review period for all permits, licenses, and approvals necessary for:
(1) new or expanded natural gas production, pipelines, storage facilities, and electric generation plants (including combined-cycle and peaker plants) located in the ERCOT region;
(2) advanced nuclear facilities, including small modular reactors and related infrastructure; and
(3) transmission lines and other upgrades needed to support the above projects.
(b) Any application that meets basic safety and environmental standards and is not acted upon within 90 days shall be automatically approved.
(c) Projects that include firm power commitments or investment from corporate partners shall receive expedited priority review.
(d) Nothing in this section shall waive federal requirements or compromise public health and safety.

SECTION 4. Natural Gas Expansion Incentives.
(a) The Texas Energy Fund is hereby expanded to include a dedicated Natural Gas Generation Account.
(b) The Public Utility Commission of Texas may award low-interest loans, not to exceed three percent (3%) per year for a term of up to twenty (20) years, to qualified projects that add at least fifty (50) megawatts of new dispatchable natural gas-fired generation capacity serving the ERCOT grid.
(c) Such loans shall cover no more than sixty percent (60%) of eligible project costs and shall be fully repayable.
(d) Performance-based completion bonuses, paid only from revolving fund repayments and not from general revenue, may be provided to projects that achieve commercial operation by December 31, 2029.
(e) The Commission shall prioritize projects that demonstrate strong economic development benefits or partnerships with large energy users.

SECTION 5. Advanced Nuclear Energy Acceleration.
(a) The Texas Advanced Nuclear Energy Office shall lead state efforts to support the siting, licensing, and deployment of advanced nuclear facilities in Texas.
(b) Using funds available in a dedicated revolving account (capitalized from existing energy-related revenues, royalties, and loan repayments), the Office may provide targeted loans or limited matching grants for:
(1) site preparation and early licensing activities;
(2) long-lead equipment procurement; and
(3) workforce training programs in nuclear operations and trades, developed in partnership with Texas colleges and universities.
(c) All financial assistance shall be performance-based, capped by project, and structured for repayment wherever feasible. No new general revenue appropriations are authorized under this section.

SECTION 6. ERCOT Grid Security Enhancements.
(a) There is established the Texas Grid Security Task Force, chaired by the Public Utility Commission of Texas and including representatives from the Railroad Commission, the Department of Public Safety, and industry experts.
(b) The Task Force shall:
(1) identify and recommend measures to protect the grid from cyberattacks, physical threats, and extreme weather;
(2) require enhanced security standards for critical natural gas and nuclear infrastructure, including fuel supply chains;
(3) prohibit the procurement of critical grid components from adversarial foreign nations in new projects; and
(4) conduct regular threat simulation exercises.
(c) The Public Utility Commission shall direct ERCOT to give priority to dispatchable natural gas and nuclear resources in grid planning and resource adequacy studies.
(d) Any new large-load customer (such as data centers or manufacturing facilities) interconnecting to the grid must demonstrate reliable firm power arrangements or adequate on-site backup generation.

SECTION 7. Public-Private Partnerships for Energy Infrastructure.
(a) The Governor’s Office of Economic Development and the Public Utility Commission of Texas are authorized to negotiate voluntary agreements with corporate partners seeking reliable, affordable power.
(b) Such agreements may include:
(1) expedited state permitting for projects that serve the partner’s energy needs;
(2) co-location of natural gas or nuclear generation facilities at or near industrial sites; and
(3) shared investment in new dispatchable generation or transmission upgrades.
(c) All agreements shall be transparent, competitively structured where possible, and reported annually to the Legislature. No taxpayer funds shall be used to guarantee private corporate debt or bail out failed projects.

SECTION 8. Funding and Fiscal Safeguards.
All programs and incentives created by this Act shall be funded exclusively through:
(1) revolving loan repayments from the Texas Energy Fund and any new dedicated accounts;
(2) existing dedicated revenues, including natural gas production royalties and fees; and
(3) voluntary private contributions or compatible federal matching funds.

No new taxes or appropriations from the state’s general revenue fund are authorized. The Comptroller shall conduct annual audits of all accounts established under this Act, and the programs shall be subject to sunset review after five (5) years.

SECTION 9. Effective Date.
This Act takes effect immediately upon passage and approval by the Governor. The Governor is authorized to issue executive orders as necessary to begin implementing the permitting reforms and to establish the Grid Security Task Force while this legislation is under consideration by the Legislature.

SECTION 10. Emergency Clause.
The importance of this legislation to the economy and security of the State of Texas creates an emergency and an imperative public necessity that the constitutional rule requiring bills to be read on three several days in each house be suspended, and said rule is hereby suspended.