Houston's Energy Corridor and the broader Texas energy industry ecosystem form the global hub for oil and gas, petrochemicals, renewable energy, and energy technology. Businesses in the Texas energy sector may be eligible for R&D tax credits, emissions reduction grants, DOE programs, and workforce training incentives that support the energy industry's workforce and technology needs.
This guide covers the most relevant grants, loans, tax credits, and incentive programs for businesses in the Texas energy sector.
Federal R&D Programs
DOE SBIR/STTR
The Department of Energy provides SBIR and STTR grants for energy technology innovation. Texas energy companies developing new technologies in areas like carbon capture, enhanced oil recovery, hydrogen, grid modernization, and clean energy may qualify for Phase I awards starting at $275,000 and Phase II at $1.6 million.
R&D Tax Credit
The federal R&D Tax Credit (Section 41) is widely applicable to energy companies developing new processes, products, or technologies. Engineering, software development, field testing, and prototype work related to energy operations may qualify.
DOE Loan Programs Office
The DOE Loan Programs Office provides loan guarantees for innovative energy projects. Businesses developing commercial-scale clean energy, advanced nuclear, carbon capture, or critical minerals projects may access loan guarantees that reduce financing costs.
Emissions and Environmental Programs
TCEQ TERP Grants
The Texas Emissions Reduction Plan provides grants for replacing or retrofitting older diesel equipment. Energy companies operating trucks, drilling equipment, generators, compressors, and marine vessels may qualify for equipment replacement funding.
EPA Programs
The EPA provides grants and technical assistance for environmental compliance, brownfield remediation, and clean air initiatives that may apply to energy operations.
State Programs
Texas Enterprise Fund
The TEF has supported energy company headquarters relocations and expansions in Texas with deal-closing grants tied to job creation and capital investment.
Skills Development Fund
The TWC partners with Houston Community College, Lee College, San Jacinto College, and other institutions to provide customized workforce training for energy industry employers.
Oil and Gas Tax Incentives
Texas provides several tax incentives specific to the oil and gas industry, including severance tax rate reductions for high-cost gas wells and enhanced oil recovery projects.
Local Resources
- Houston Energy Corridor District: Infrastructure and mobility improvements for the Energy Corridor area.
- Greater Houston Partnership: Economic development resources for the energy sector.
- Rice University Energy Programs: Research partnerships and commercialization support.
- UH Energy SBDC: Specialized business consulting for energy companies.
Steps for Energy Corridor Business Owners
- Evaluate R&D Tax Credit: Engineering and technology development work may qualify for substantial credits.
- Review DOE SBIR/STTR: Energy technology companies should explore federal R&D grants.
- Check TCEQ programs: Equipment replacement grants for diesel-powered operations.
- Contact the UH SBDC: Free consulting for program identification.
- Explore DOE loan programs: Innovative energy projects may access federal loan guarantees.
Find Programs That May Fit Your Business
Texas energy businesses may qualify for industry-specific federal programs alongside general state and local incentives. Our screening report matches your business against all applicable programs. Start your free screening →