| 1 | 1 | | H.B. No. 4885 |
|---|
| 2 | 2 | | |
|---|
| 3 | 3 | | |
|---|
| 4 | 4 | | AN ACT |
|---|
| 5 | 5 | | relating to programs established and funded under the Texas |
|---|
| 6 | 6 | | emissions reduction plan. |
|---|
| 7 | 7 | | BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
|---|
| 8 | 8 | | SECTION 1. Section 386.051(b), Health and Safety Code, is |
|---|
| 9 | 9 | | amended to read as follows: |
|---|
| 10 | 10 | | (b) Under the plan, the commission and the comptroller shall |
|---|
| 11 | 11 | | provide grants or other funding for: |
|---|
| 12 | 12 | | (1) the diesel emissions reduction incentive program |
|---|
| 13 | 13 | | established under Subchapter C, including for infrastructure |
|---|
| 14 | 14 | | projects established under that subchapter; |
|---|
| 15 | 15 | | (2) the motor vehicle purchase or lease incentive |
|---|
| 16 | 16 | | program established under Subchapter D; |
|---|
| 17 | 17 | | (3) the air quality research support program |
|---|
| 18 | 18 | | established under Chapter 387; |
|---|
| 19 | 19 | | (4) the clean school bus program established under |
|---|
| 20 | 20 | | Chapter 390; |
|---|
| 21 | 21 | | (5) the new technology implementation grant program |
|---|
| 22 | 22 | | established under Chapter 391; |
|---|
| 23 | 23 | | (6) the regional air monitoring program established |
|---|
| 24 | 24 | | under Section 386.252(a); |
|---|
| 25 | 25 | | (7) a health effects study as provided by Section |
|---|
| 26 | 26 | | 386.252(a); |
|---|
| 27 | 27 | | (8) air quality planning activities as provided by |
|---|
| 28 | 28 | | Section 386.252(d); |
|---|
| 29 | 29 | | (9) a contract with the Energy Systems Laboratory at |
|---|
| 30 | 30 | | the Texas A&M Engineering Experiment Station for computation of |
|---|
| 31 | 31 | | creditable statewide emissions reductions as provided by Section |
|---|
| 32 | 32 | | 386.252(a); |
|---|
| 33 | 33 | | (10) the Texas clean fleet program established under |
|---|
| 34 | 34 | | Chapter 392; |
|---|
| 35 | 35 | | (11) the Texas alternative fueling facilities program |
|---|
| 36 | 36 | | established under Chapter 393; |
|---|
| 37 | 37 | | (12) the Texas natural gas vehicle grant program |
|---|
| 38 | 38 | | established under Chapter 394; |
|---|
| 39 | 39 | | (13) other programs the commission may develop that |
|---|
| 40 | 40 | | lead to reduced emissions of nitrogen oxides, particulate matter, |
|---|
| 41 | 41 | | or volatile organic compounds in a nonattainment area or affected |
|---|
| 42 | 42 | | county; |
|---|
| 43 | 43 | | (14) other programs the commission may develop that |
|---|
| 44 | 44 | | support congestion mitigation to reduce mobile source ozone |
|---|
| 45 | 45 | | precursor emissions; |
|---|
| 46 | 46 | | (15) the seaport and rail yard areas emissions |
|---|
| 47 | 47 | | reduction program established under Subchapter D-1; |
|---|
| 48 | 48 | | (16) conducting research and other activities |
|---|
| 49 | 49 | | associated with making any necessary demonstrations to the United |
|---|
| 50 | 50 | | States Environmental Protection Agency to account for the impact of |
|---|
| 51 | 51 | | foreign emissions or an exceptional event; |
|---|
| 52 | 52 | | (17) studies of or pilot programs for incentives for |
|---|
| 53 | 53 | | port authorities located in nonattainment areas or affected |
|---|
| 54 | 54 | | counties as provided by Section 386.252(a); |
|---|
| 55 | 55 | | (18) the governmental alternative fuel fleet grant |
|---|
| 56 | 56 | | program established under Chapter 395; [and] |
|---|
| 57 | 57 | | (19) remittance of funds to the state highway fund for |
|---|
| 58 | 58 | | use by the Texas Department of Transportation for congestion |
|---|
| 59 | 59 | | mitigation and air quality improvement projects in nonattainment |
|---|
| 60 | 60 | | areas and affected counties; and |
|---|
| 61 | 61 | | (20) the Texas hydrogen infrastructure, vehicle, and |
|---|
| 62 | 62 | | equipment grant program established under Subchapter G. |
|---|
| 63 | 63 | | SECTION 2. Section 386.252(a), Health and Safety Code, is |
|---|
| 64 | 64 | | amended to read as follows: |
|---|
| 65 | 65 | | (a) Money in the fund and account may be used only to |
|---|
| 66 | 66 | | implement and administer programs established under the plan. |
|---|
| 67 | 67 | | Subject to the reallocation of funds by the commission under |
|---|
| 68 | 68 | | Subsection (h) and after remittance to the state highway fund under |
|---|
| 69 | 69 | | Subsection (a-1), money from the fund and account to be used for the |
|---|
| 70 | 70 | | programs under Section 386.051(b) shall initially be allocated as |
|---|
| 71 | 71 | | follows: |
|---|
| 72 | 72 | | (1) four percent may be used for the clean school bus |
|---|
| 73 | 73 | | program under Chapter 390; |
|---|
| 74 | 74 | | (2) eight [three] percent total may be used between |
|---|
| 75 | 75 | | the Texas hydrogen infrastructure, vehicle, and equipment grant |
|---|
| 76 | 76 | | program established under Subchapter G and [for] the new technology |
|---|
| 77 | 77 | | implementation grant program under Chapter 391, from which at least |
|---|
| 78 | 78 | | $1 million will be set aside for electricity storage projects |
|---|
| 79 | 79 | | related to renewable energy and not more than $8 million may be used |
|---|
| 80 | 80 | | for the Texas hydrogen infrastructure, vehicle, and equipment grant |
|---|
| 81 | 81 | | program; |
|---|
| 82 | 82 | | (3) five percent may be used for the Texas clean fleet |
|---|
| 83 | 83 | | program under Chapter 392; |
|---|
| 84 | 84 | | (4) not more than $3 million may be used by the |
|---|
| 85 | 85 | | commission to fund a regional air monitoring program in commission |
|---|
| 86 | 86 | | Regions 3 and 4 to be implemented under the commission's oversight, |
|---|
| 87 | 87 | | including direction regarding the type, number, location, and |
|---|
| 88 | 88 | | operation of, and data validation practices for, monitors funded by |
|---|
| 89 | 89 | | the program through a regional nonprofit entity located in North |
|---|
| 90 | 90 | | Texas having representation from counties, municipalities, higher |
|---|
| 91 | 91 | | education institutions, and private sector interests across the |
|---|
| 92 | 92 | | area; |
|---|
| 93 | 93 | | (5) 7.5 [10] percent may be used for the Texas natural |
|---|
| 94 | 94 | | gas vehicle grant program under Chapter 394; |
|---|
| 95 | 95 | | (6) not more than $6 million may be used for the Texas |
|---|
| 96 | 96 | | alternative fueling facilities program under Chapter 393, of which |
|---|
| 97 | 97 | | a specified amount may be used for fueling stations to provide |
|---|
| 98 | 98 | | natural gas fuel, except that money may not be allocated for the |
|---|
| 99 | 99 | | Texas alternative fueling facilities program for the state fiscal |
|---|
| 100 | 100 | | year ending August 31, 2019; |
|---|
| 101 | 101 | | (7) not more than $750,000 may be used each year to |
|---|
| 102 | 102 | | support research related to air quality as provided by Chapter 387; |
|---|
| 103 | 103 | | (8) not more than $200,000 may be used for a health |
|---|
| 104 | 104 | | effects study; |
|---|
| 105 | 105 | | (9) at least $6 million but not more than 15 percent |
|---|
| 106 | 106 | | [$16 million] may be used by the commission for administrative |
|---|
| 107 | 107 | | costs, including all direct and indirect costs for administering |
|---|
| 108 | 108 | | the plan, costs for conducting outreach and education activities, |
|---|
| 109 | 109 | | and costs attributable to the review or approval of applications |
|---|
| 110 | 110 | | for marketable emissions reduction credits; |
|---|
| 111 | 111 | | (10) six percent may be used by the commission for the |
|---|
| 112 | 112 | | seaport and rail yard areas emissions reduction program established |
|---|
| 113 | 113 | | under Subchapter D-1; |
|---|
| 114 | 114 | | (11) 2.5 [five] percent may be used for the light-duty |
|---|
| 115 | 115 | | motor vehicle purchase or lease incentive program established under |
|---|
| 116 | 116 | | Subchapter D; |
|---|
| 117 | 117 | | (12) not more than $500,000 [$216,000] may be used by |
|---|
| 118 | 118 | | the commission to contract with the Energy Systems Laboratory at |
|---|
| 119 | 119 | | the Texas A&M Engineering Experiment Station annually for the |
|---|
| 120 | 120 | | development and annual computation of creditable statewide |
|---|
| 121 | 121 | | emissions reductions for the state implementation plan that are |
|---|
| 122 | 122 | | obtained through: |
|---|
| 123 | 123 | | (A) wind and other renewable energy resources; |
|---|
| 124 | 124 | | (B) energy efficiency programs administered by |
|---|
| 125 | 125 | | the Public Utility Commission of Texas or the State Energy |
|---|
| 126 | 126 | | Conservation Office; or |
|---|
| 127 | 127 | | (C) the implementation of advanced building |
|---|
| 128 | 128 | | energy codes [for the state implementation plan]; |
|---|
| 129 | 129 | | (13) not more than $500,000 may be used for studies of |
|---|
| 130 | 130 | | or pilot programs for incentives for port authorities located in |
|---|
| 131 | 131 | | nonattainment areas or affected counties to encourage cargo |
|---|
| 132 | 132 | | movement that reduces emissions of nitrogen oxides and particulate |
|---|
| 133 | 133 | | matter; and |
|---|
| 134 | 134 | | (14) the balance is to be used by the commission for |
|---|
| 135 | 135 | | the diesel emissions reduction incentive program under Subchapter C |
|---|
| 136 | 136 | | as determined by the commission. |
|---|
| 137 | 137 | | SECTION 3. Chapter 386, Health and Safety Code, is amended |
|---|
| 138 | 138 | | by adding Subchapter G to read as follows: |
|---|
| 139 | 139 | | SUBCHAPTER G. TEXAS HYDROGEN INFRASTRUCTURE, VEHICLE, AND |
|---|
| 140 | 140 | | EQUIPMENT GRANT PROGRAM |
|---|
| 141 | 141 | | Sec. 386.301. DEFINITIONS. In this subchapter: |
|---|
| 142 | 142 | | (1) "Hydrogen vehicle or equipment" means a heavy-duty |
|---|
| 143 | 143 | | motor vehicle or piece of heavy-duty equipment that uses hydrogen |
|---|
| 144 | 144 | | to operate the vehicle or equipment, including through the use of |
|---|
| 145 | 145 | | hydrogen fuel cells or an internal combustion engine that runs on |
|---|
| 146 | 146 | | hydrogen. |
|---|
| 147 | 147 | | (2) "Program" means the Texas hydrogen |
|---|
| 148 | 148 | | infrastructure, vehicle, and equipment grant program established |
|---|
| 149 | 149 | | under this subchapter. |
|---|
| 150 | 150 | | Sec. 386.302. PROGRAM. (a) The commission shall establish |
|---|
| 151 | 151 | | and administer the Texas hydrogen infrastructure, vehicle, and |
|---|
| 152 | 152 | | equipment grant program to encourage the adoption of hydrogen |
|---|
| 153 | 153 | | infrastructure, vehicles, and equipment. Under the program, the |
|---|
| 154 | 154 | | commission shall provide funding for eligible projects to offset |
|---|
| 155 | 155 | | the incremental cost of projects that reduce emissions of oxides of |
|---|
| 156 | 156 | | nitrogen from high-emitting sources in nonattainment areas and |
|---|
| 157 | 157 | | affected counties of this state. The commission shall determine |
|---|
| 158 | 158 | | the eligibility of projects. |
|---|
| 159 | 159 | | (b) Projects that may be considered for a grant under the |
|---|
| 160 | 160 | | program include: |
|---|
| 161 | 161 | | (1) implementation of hydrogen infrastructure |
|---|
| 162 | 162 | | projects; |
|---|
| 163 | 163 | | (2) purchase or lease of on-road or non-road hydrogen |
|---|
| 164 | 164 | | vehicles or equipment; |
|---|
| 165 | 165 | | (3) replacement of on-road or non-road heavy-duty |
|---|
| 166 | 166 | | vehicles or equipment with newer on-road or non-road hydrogen |
|---|
| 167 | 167 | | vehicles or equipment; and |
|---|
| 168 | 168 | | (4) the repower or conversion of on-road or non-road |
|---|
| 169 | 169 | | heavy-duty vehicles or equipment with a powertrain that runs on or |
|---|
| 170 | 170 | | is powered by hydrogen. |
|---|
| 171 | 171 | | (c) A project listed in Subsection (b) is not eligible if it |
|---|
| 172 | 172 | | is required by any state or federal law, rule or regulation, |
|---|
| 173 | 173 | | memorandum of agreement, or other legally binding document. This |
|---|
| 174 | 174 | | subsection does not apply to: |
|---|
| 175 | 175 | | (1) an otherwise qualified project, regardless of the |
|---|
| 176 | 176 | | fact that the state implementation plan assumes that the change in |
|---|
| 177 | 177 | | vehicles, equipment, or operations will occur, if on the date the |
|---|
| 178 | 178 | | grant is awarded the change is not required by any state or federal |
|---|
| 179 | 179 | | law, rule or regulation, memorandum of agreement, or other legally |
|---|
| 180 | 180 | | binding document; or |
|---|
| 181 | 181 | | (2) the purchase of a hydrogen vehicle or equipment or |
|---|
| 182 | 182 | | facility required only by local law or regulation or by corporate or |
|---|
| 183 | 183 | | controlling board policy of a public or private entity. |
|---|
| 184 | 184 | | (d) The commission shall prioritize the awarding of grants |
|---|
| 185 | 185 | | under this subchapter in the following order: |
|---|
| 186 | 186 | | (1) projects to replace on-road heavy-duty vehicles |
|---|
| 187 | 187 | | with newer on-road hydrogen vehicles; |
|---|
| 188 | 188 | | (2) projects to purchase, lease, repower, or convert |
|---|
| 189 | 189 | | on-road heavy-duty vehicles with a powertrain that runs on or is |
|---|
| 190 | 190 | | powered by hydrogen; |
|---|
| 191 | 191 | | (3) projects to implement hydrogen refueling |
|---|
| 192 | 192 | | infrastructure that will be accessible and available to the public |
|---|
| 193 | 193 | | at times designated by the grant contract; |
|---|
| 194 | 194 | | (4) projects to replace non-road heavy-duty vehicles |
|---|
| 195 | 195 | | with newer non-road hydrogen vehicles; and |
|---|
| 196 | 196 | | (5) projects to purchase, lease, repower, or convert |
|---|
| 197 | 197 | | non-road heavy-duty vehicles with a powertrain that runs on or is |
|---|
| 198 | 198 | | powered by hydrogen. |
|---|
| 199 | 199 | | (e) Subject to Subsection (d), in awarding grants under this |
|---|
| 200 | 200 | | subchapter, the commission shall give preference to the most |
|---|
| 201 | 201 | | cost-effective projects that will result in the greatest reduction |
|---|
| 202 | 202 | | in emissions of oxides of nitrogen. |
|---|
| 203 | 203 | | (f) The commission shall establish additional eligibility |
|---|
| 204 | 204 | | and prioritization criteria as needed to implement the program. |
|---|
| 205 | 205 | | Sec. 386.303. APPLICATION PACKAGE. (a) The commission |
|---|
| 206 | 206 | | shall develop a simple, standardized application package for grants |
|---|
| 207 | 207 | | under this subchapter. The package must include: |
|---|
| 208 | 208 | | (1) an application form; |
|---|
| 209 | 209 | | (2) a brief description of: |
|---|
| 210 | 210 | | (A) the program; |
|---|
| 211 | 211 | | (B) the projects that are eligible for available |
|---|
| 212 | 212 | | funding; |
|---|
| 213 | 213 | | (C) the selection criteria and evaluation |
|---|
| 214 | 214 | | process; and |
|---|
| 215 | 215 | | (D) the required documentation; |
|---|
| 216 | 216 | | (3) the name of a person or office to contact for more |
|---|
| 217 | 217 | | information; |
|---|
| 218 | 218 | | (4) an example of the contract that an applicant will |
|---|
| 219 | 219 | | be required to execute before receiving a grant; and |
|---|
| 220 | 220 | | (5) any other information the commission considers |
|---|
| 221 | 221 | | useful to inform the applicant and expedite the application |
|---|
| 222 | 222 | | process. |
|---|
| 223 | 223 | | (b) The application form shall require as much information |
|---|
| 224 | 224 | | as the commission determines is necessary to properly evaluate each |
|---|
| 225 | 225 | | project but shall otherwise minimize the information required. |
|---|
| 226 | 226 | | Sec. 386.304. APPLICATION REVIEW PROCEDURES. (a) The |
|---|
| 227 | 227 | | commission shall review an application for a grant for a project |
|---|
| 228 | 228 | | authorized under this subchapter. If the commission determines |
|---|
| 229 | 229 | | that an application is incomplete, the commission shall notify the |
|---|
| 230 | 230 | | applicant with an explanation of what is missing from the |
|---|
| 231 | 231 | | application. The commission shall evaluate the completed |
|---|
| 232 | 232 | | application according to the appropriate project criteria. Subject |
|---|
| 233 | 233 | | to available funding, the commission shall make a final |
|---|
| 234 | 234 | | determination on an application as soon as possible. |
|---|
| 235 | 235 | | (b) The commission shall make every effort to expedite the |
|---|
| 236 | 236 | | application review process and to award grants to qualified |
|---|
| 237 | 237 | | projects in a timely manner. To the extent possible, the commission |
|---|
| 238 | 238 | | shall coordinate project review and approval with any timing |
|---|
| 239 | 239 | | constraints related to project purchases or installations to be |
|---|
| 240 | 240 | | made by an applicant. |
|---|
| 241 | 241 | | (c) The commission may deny an application for a project |
|---|
| 242 | 242 | | that does not meet the applicable project criteria or that the |
|---|
| 243 | 243 | | commission determines is not made in good faith, is not credible, or |
|---|
| 244 | 244 | | is not in compliance with this chapter and the goals of this |
|---|
| 245 | 245 | | chapter. |
|---|
| 246 | 246 | | (d) Subject to availability of funds, the commission shall |
|---|
| 247 | 247 | | award a grant under this subchapter in conjunction with the |
|---|
| 248 | 248 | | execution of a contract that obligates the commission to make the |
|---|
| 249 | 249 | | grant and the recipient to perform the actions described in the |
|---|
| 250 | 250 | | recipient's grant application. The contract must incorporate |
|---|
| 251 | 251 | | provisions for recapturing grant money in proportion to any loss of |
|---|
| 252 | 252 | | emissions reductions compared with the volume of emissions |
|---|
| 253 | 253 | | reductions that was projected in awarding the grant. Grant money |
|---|
| 254 | 254 | | recaptured under the contract provision shall be deposited in the |
|---|
| 255 | 255 | | fund and reallocated for other projects under this chapter. |
|---|
| 256 | 256 | | SECTION 4. Section 391.002(b), Health and Safety Code, is |
|---|
| 257 | 257 | | amended to read as follows: |
|---|
| 258 | 258 | | (b) Projects that may be considered for a grant under the |
|---|
| 259 | 259 | | program include: |
|---|
| 260 | 260 | | (1) advanced clean energy projects, as defined by |
|---|
| 261 | 261 | | Section 382.003; |
|---|
| 262 | 262 | | (2) new technology projects that reduce emissions of |
|---|
| 263 | 263 | | regulated pollutants from stationary sources; |
|---|
| 264 | 264 | | (3) new technology projects that reduce emissions from |
|---|
| 265 | 265 | | upstream, [and] midstream, or downstream oil and gas production, |
|---|
| 266 | 266 | | completions, gathering, storage, processing, [and] transmission, |
|---|
| 267 | 267 | | or refining activities through: |
|---|
| 268 | 268 | | (A) the replacement, repower, or retrofit of |
|---|
| 269 | 269 | | stationary compressor engines; |
|---|
| 270 | 270 | | (B) the installation of systems to reduce or |
|---|
| 271 | 271 | | eliminate the loss of gas, flaring of gas, or burning of gas using |
|---|
| 272 | 272 | | other combustion control devices; or |
|---|
| 273 | 273 | | (C) the installation of systems that reduce |
|---|
| 274 | 274 | | flaring emissions and other site emissions; and |
|---|
| 275 | 275 | | (4) electricity storage projects related to renewable |
|---|
| 276 | 276 | | energy, including projects to store electricity produced from wind |
|---|
| 277 | 277 | | and solar generation that provide efficient means of making the |
|---|
| 278 | 278 | | stored energy available during periods of peak energy use. |
|---|
| 279 | 279 | | SECTION 5. This Act takes effect September 1, 2023. |
|---|
| 280 | 280 | | ______________________________ ______________________________ |
|---|
| 281 | 281 | | President of the Senate Speaker of the House |
|---|
| 282 | 282 | | I certify that H.B. No. 4885 was passed by the House on April |
|---|
| 283 | 283 | | 28, 2023, by the following vote: Yeas 108, Nays 37, 2 present, not |
|---|
| 284 | 284 | | voting; and that the House concurred in Senate amendments to H.B. |
|---|
| 285 | 285 | | No. 4885 on May 25, 2023, by the following vote: Yeas 127, Nays 13, |
|---|
| 286 | 286 | | 1 present, not voting. |
|---|
| 287 | 287 | | ______________________________ |
|---|
| 288 | 288 | | Chief Clerk of the House |
|---|
| 289 | 289 | | I certify that H.B. No. 4885 was passed by the Senate, with |
|---|
| 290 | 290 | | amendments, on May 23, 2023, by the following vote: Yeas 27, Nays |
|---|
| 291 | 291 | | 4. |
|---|
| 292 | 292 | | ______________________________ |
|---|
| 293 | 293 | | Secretary of the Senate |
|---|
| 294 | 294 | | APPROVED: __________________ |
|---|
| 295 | 295 | | Date |
|---|
| 296 | 296 | | __________________ |
|---|
| 297 | 297 | | Governor |
|---|