For the hushpuppies: Preheat frying oil to 360°F. In a medium-size mixing bowl, combine measured dry ingredients, using a balloon whisk to blend ingredients thoroughly. Make a well in the center. Add chopped onions, red sweet pepper, jalapeño, egg, bacon fat, chopped bacon, buttermilk and cheddar. Blend to make a stiff batter. Batter should easily fall from the scoop.
Use a 1-ounce scoop to portion batter and carefully release each hushpuppy into the hot oil, one at a time. Fry 3 1/2 minutes or until deep golden brown and floats. Place on paper towel to drain. Let rest for 5 minutes before serving.