The Connect the Grid Act of 2026 is designed to strengthen the electric grid by connecting Texas's power system to neighboring states. Right now, Texas operates its own independent power grid through ERCOT (Electric Reliability Council of Texas), which is largely separate from the rest of the country. This bill removes special exemptions that have kept Texas independent and brings it under federal regulation, requiring it to interconnect with neighboring power systems in the South, Midwest, and West.

The bill sets specific targets for how much electricity can flow between Texas and its neighbors—between 4.3 and 12.6 gigawatts with the Southwest Power Pool, 2.5 and 16.2 gigawatts with the Midcontinent Independent System Operator, and 2.6 and 7.9 gigawatts with the Western Interconnection. These connections must be completed by January 1, 2035. The law prioritizes using existing routes (like highways and railroads), building on contaminated or abandoned land, and expanding access to renewable energy. It also requires meaningful community involvement, especially with environmental justice communities and Indigenous tribes, and mandates the use of apprenticeship programs and prevailing wages for construction jobs.

Additionally, the bill increases federal borrowing authority for transmission projects from $2.5 billion to $13.5 billion to help fund these infrastructure improvements, and it directs the Department of Energy to study the benefits of connecting U.S. power systems with Mexico's grid.