The Texas Public Utility Commission has put out a proposed rule for public comment that would establish the fourth and final program under the $10 billion Texas Energy Fund.

The PUC endorsed staff’s proposal laying out procedures to apply for grants or loans to procure, install and operate backup power systems under the TEF’s Texas Backup Power Package Program during its Dec. 18 open meeting (59024).

The program would provide $1.8 billion in funding for qualifying entities to install and operate backup power equipment at hospitals, nursing homes and other facilities that support community health, safety and well-being. Staff’s proposed rules define a backup power package as a stand-alone, multiday backup power source for facilities without passing through a utility electric meter.

“Applications to this program could be in the thousands,” staff’s Rama Singh Rastogi told commissioners.

She said the program’s loans are structured as forgivable loans, with 100% forgiveness should the applicant comply with performance requirements. The program excludes sourcing power from electric school bus batteries until the PUC further studies their use and integration into the program.

Comments are due Jan. 30, 2026.

The commission also approved staff’s recommendation to approve more than $282 million in grants to six applicants for their 14 projects under the TEF’s Outside ERCOT program. The program offers grants for facility modernization, facility weatherization, reliability and resiliency, and vegetation management (58492).

Southwestern Public Service Co. is eligible for about half of the loans. It applied for $200 million in reliability and resiliency awards and was approved for $148.6 million, covering three projects. El Paso Electric was approved for $61.3 million in loans for two applications covering a variety of reliability projects.

The applicants still must pass a review by the PUC’s executive director before any funds are disbursed.