The Texas Commission on Environmental Quality (TCEQ) administers the Texas Emissions Reduction Plan (TERP), which provides grants to help Texas businesses replace, repower, or retrofit older diesel vehicles and equipment with cleaner alternatives. If your business operates diesel trucks, construction equipment, agricultural machinery, cargo handling equipment, or other diesel-powered fleet vehicles, TERP grants may cover a substantial portion of the cost of upgrading to newer, cleaner equipment.
TERP Grant Programs
Diesel Emissions Reduction Incentive (DERI) Program
The DERI program is the primary TERP grant for fleet replacement. Grants cover a percentage of the cost of replacing or repowering eligible diesel vehicles and equipment. Eligible categories include on-road trucks, off-road construction and industrial equipment, locomotives, marine vessels, and stationary equipment.
Texas Clean Fleet Program
This program targets larger fleets and provides grants for replacing multiple vehicles or equipment units. Businesses operating fleets of diesel vehicles may qualify for grants covering replacement of multiple units simultaneously.
Texas Natural Gas Vehicle Grant Program
Grants are available for purchasing new natural gas vehicles or converting existing vehicles to run on natural gas. This program may be relevant for trucking companies, delivery fleets, and other businesses with heavy vehicle use.
Eligibility
Geographic Requirements
TERP grants are generally available for equipment operating primarily in Texas. Some programs focus on specific nonattainment areas or regions with air quality concerns, including the Dallas-Fort Worth, Houston-Galveston-Brazoria, San Antonio, Austin, and El Paso areas.
Equipment Requirements
Equipment must typically be operational and registered in Texas. Minimum age requirements vary by program but generally target older diesel engines manufactured before certain model years. Replacement equipment must meet current emissions standards.
Business Requirements
Eligible applicants include businesses, individuals, local governments, and other entities operating qualifying diesel equipment in Texas.
Grant Amounts
Grant amounts vary by program and equipment type but can cover 25% to 80% of the cost of eligible replacement activities. The exact percentage depends on the emissions reduction achieved, the type of equipment, and the specific TERP program. For on-road trucks, grants may cover $20,000 to $100,000 or more per vehicle depending on the replacement scenario. TCEQ grants for trucking.
Application Process
TERP applications are submitted to TCEQ during open solicitation periods. Application rounds are announced on the TCEQ website. Required documentation includes equipment inventories, emissions calculations, cost estimates, and business information. TCEQ staff evaluate applications based on emissions reduction per dollar invested.
Industries That Benefit Most
- Trucking and logistics: On-road diesel truck replacement is one of the largest TERP categories.
- Construction: Off-road construction equipment replacement including excavators, loaders, and dozers.
- Agriculture: Farm equipment and irrigation engines may qualify for replacement grants.
- Manufacturing: Industrial equipment, forklifts, and yard trucks used in manufacturing operations.
- Port and marine: Cargo handling equipment and marine vessels at Texas ports.
Find Programs That May Fit Your Business
TERP grants may be combined with other federal, state, and local programs. Our free screening report identifies all matching programs for your business. Start your free screening →