H.B. No. 4885
AN ACT
relating to programs established and funded under the Texas
emissions reduction plan.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 386.051(b), Health and Safety Code, is
amended to read as follows:
(b) Under the plan, the commission and the comptroller shall
provide grants or other funding for:
(1) the diesel emissions reduction incentive program
established under Subchapter C, including for infrastructure
projects established under that subchapter;
(2) the motor vehicle purchase or lease incentive
program established under Subchapter D;
(3) the air quality research support program
established under Chapter 387;
(4) the clean school bus program established under
Chapter 390;
(5) the new technology implementation grant program
established under Chapter 391;
(6) the regional air monitoring program established
under Section 386.252(a);
(7) a health effects study as provided by Section
386.252(a);
(8) air quality planning activities as provided by
Section 386.252(d);
(9) a contract with the Energy Systems Laboratory at
the Texas A&M Engineering Experiment Station for computation of
creditable statewide emissions reductions as provided by Section
386.252(a);
(10) the Texas clean fleet program established under
Chapter 392;
(11) the Texas alternative fueling facilities program
established under Chapter 393;
(12) the Texas natural gas vehicle grant program
established under Chapter 394;
(13) other programs the commission may develop that
lead to reduced emissions of nitrogen oxides, particulate matter,
or volatile organic compounds in a nonattainment area or affected
county;
(14) other programs the commission may develop that
support congestion mitigation to reduce mobile source ozone
precursor emissions;
(15) the seaport and rail yard areas emissions
reduction program established under Subchapter D-1;
(16) conducting research and other activities
associated with making any necessary demonstrations to the United
States Environmental Protection Agency to account for the impact of
foreign emissions or an exceptional event;
(17) studies of or pilot programs for incentives for
port authorities located in nonattainment areas or affected
counties as provided by Section 386.252(a);
(18) the governmental alternative fuel fleet grant
program established under Chapter 395; [and]
(19) remittance of funds to the state highway fund for
use by the Texas Department of Transportation for congestion
mitigation and air quality improvement projects in nonattainment
areas and affected counties; and
(20) the Texas hydrogen infrastructure, vehicle, and
equipment grant program established under Subchapter G.
SECTION 2. Section 386.252(a), Health and Safety Code, is
amended to read as follows:
(a) Money in the fund and account may be used only to
implement and administer programs established under the plan.
Subject to the reallocation of funds by the commission under
Subsection (h) and after remittance to the state highway fund under
Subsection (a-1), money from the fund and account to be used for the
programs under Section 386.051(b) shall initially be allocated as
follows:
(1) four percent may be used for the clean school bus
program under Chapter 390;
(2) eight [three] percent total may be used between
the Texas hydrogen infrastructure, vehicle, and equipment grant
program established under Subchapter G and [for] the new technology
implementation grant program under Chapter 391, from which at least
$1 million will be set aside for electricity storage projects
related to renewable energy and not more than $8 million may be used
for the Texas hydrogen infrastructure, vehicle, and equipment grant
program;
(3) five percent may be used for the Texas clean fleet
program under Chapter 392;
(4) not more than $3 million may be used by the
commission to fund a regional air monitoring program in commission
Regions 3 and 4 to be implemented under the commission's oversight,
including direction regarding the type, number, location, and
operation of, and data validation practices for, monitors funded by
the program through a regional nonprofit entity located in North
Texas having representation from counties, municipalities, higher
education institutions, and private sector interests across the
area;
(5) 7.5 [10] percent may be used for the Texas natural
gas vehicle grant program under Chapter 394;
(6) not more than $6 million may be used for the Texas
alternative fueling facilities program under Chapter 393, of which
a specified amount may be used for fueling stations to provide
natural gas fuel, except that money may not be allocated for the
Texas alternative fueling facilities program for the state fiscal
year ending August 31, 2019;
(7) not more than $750,000 may be used each year to
support research related to air quality as provided by Chapter 387;
(8) not more than $200,000 may be used for a health
effects study;
(9) at least $6 million but not more than 15 percent
[$16 million] may be used by the commission for administrative
costs, including all direct and indirect costs for administering
the plan, costs for conducting outreach and education activities,
and costs attributable to the review or approval of applications
for marketable emissions reduction credits;
(10) six percent may be used by the commission for the
seaport and rail yard areas emissions reduction program established
under Subchapter D-1;
(11) 2.5 [five] percent may be used for the light-duty
motor vehicle purchase or lease incentive program established under
Subchapter D;
(12) not more than $500,000 [$216,000] may be used by
the commission to contract with the Energy Systems Laboratory at
the Texas A&M Engineering Experiment Station annually for the
development and annual computation of creditable statewide
emissions reductions for the state implementation plan that are
obtained through:
(A) wind and other renewable energy resources;
(B) energy efficiency programs administered by
the Public Utility Commission of Texas or the State Energy
Conservation Office; or
(C) the implementation of advanced building
energy codes [for the state implementation plan];
(13) not more than $500,000 may be used for studies of
or pilot programs for incentives for port authorities located in
nonattainment areas or affected counties to encourage cargo
movement that reduces emissions of nitrogen oxides and particulate
matter; and
(14) the balance is to be used by the commission for
the diesel emissions reduction incentive program under Subchapter C
as determined by the commission.
SECTION 3. Chapter 386, Health and Safety Code, is amended
by adding Subchapter G to read as follows:
SUBCHAPTER G. TEXAS HYDROGEN INFRASTRUCTURE, VEHICLE, AND
EQUIPMENT GRANT PROGRAM
Sec. 386.301. DEFINITIONS. In this subchapter:
(1) "Hydrogen vehicle or equipment" means a heavy-duty
motor vehicle or piece of heavy-duty equipment that uses hydrogen
to operate the vehicle or equipment, including through the use of
hydrogen fuel cells or an internal combustion engine that runs on
hydrogen.
(2) "Program" means the Texas hydrogen
infrastructure, vehicle, and equipment grant program established
under this subchapter.
Sec. 386.302. PROGRAM. (a) The commission shall establish
and administer the Texas hydrogen infrastructure, vehicle, and
equipment grant program to encourage the adoption of hydrogen
infrastructure, vehicles, and equipment. Under the program, the
commission shall provide funding for eligible projects to offset
the incremental cost of projects that reduce emissions of oxides of
nitrogen from high-emitting sources in nonattainment areas and
affected counties of this state. The commission shall determine
the eligibility of projects.
(b) Projects that may be considered for a grant under the
program include:
(1) implementation of hydrogen infrastructure
projects;
(2) purchase or lease of on-road or non-road hydrogen
vehicles or equipment;
(3) replacement of on-road or non-road heavy-duty
vehicles or equipment with newer on-road or non-road hydrogen
vehicles or equipment; and
(4) the repower or conversion of on-road or non-road
heavy-duty vehicles or equipment with a powertrain that runs on or
is powered by hydrogen.
(c) A project listed in Subsection (b) is not eligible if it
is required by any state or federal law, rule or regulation,
memorandum of agreement, or other legally binding document. This
subsection does not apply to:
(1) an otherwise qualified project, regardless of the
fact that the state implementation plan assumes that the change in
vehicles, equipment, or operations will occur, if on the date the
grant is awarded the change is not required by any state or federal
law, rule or regulation, memorandum of agreement, or other legally
binding document; or
(2) the purchase of a hydrogen vehicle or equipment or
facility required only by local law or regulation or by corporate or
controlling board policy of a public or private entity.
(d) The commission shall prioritize the awarding of grants
under this subchapter in the following order:
(1) projects to replace on-road heavy-duty vehicles
with newer on-road hydrogen vehicles;
(2) projects to purchase, lease, repower, or convert
on-road heavy-duty vehicles with a powertrain that runs on or is
powered by hydrogen;
(3) projects to implement hydrogen refueling
infrastructure that will be accessible and available to the public
at times designated by the grant contract;
(4) projects to replace non-road heavy-duty vehicles
with newer non-road hydrogen vehicles; and
(5) projects to purchase, lease, repower, or convert
non-road heavy-duty vehicles with a powertrain that runs on or is
powered by hydrogen.
(e) Subject to Subsection (d), in awarding grants under this
subchapter, the commission shall give preference to the most
cost-effective projects that will result in the greatest reduction
in emissions of oxides of nitrogen.
(f) The commission shall establish additional eligibility
and prioritization criteria as needed to implement the program.
Sec. 386.303. APPLICATION PACKAGE. (a) The commission
shall develop a simple, standardized application package for grants
under this subchapter. The package must include:
(1) an application form;
(2) a brief description of:
(A) the program;
(B) the projects that are eligible for available
funding;
(C) the selection criteria and evaluation
process; and
(D) the required documentation;
(3) the name of a person or office to contact for more
information;
(4) an example of the contract that an applicant will
be required to execute before receiving a grant; and
(5) any other information the commission considers
useful to inform the applicant and expedite the application
process.
(b) The application form shall require as much information
as the commission determines is necessary to properly evaluate each
project but shall otherwise minimize the information required.
Sec. 386.304. APPLICATION REVIEW PROCEDURES. (a) The
commission shall review an application for a grant for a project
authorized under this subchapter. If the commission determines
that an application is incomplete, the commission shall notify the
applicant with an explanation of what is missing from the
application. The commission shall evaluate the completed
application according to the appropriate project criteria. Subject
to available funding, the commission shall make a final
determination on an application as soon as possible.
(b) The commission shall make every effort to expedite the
application review process and to award grants to qualified
projects in a timely manner. To the extent possible, the commission
shall coordinate project review and approval with any timing
constraints related to project purchases or installations to be
made by an applicant.
(c) The commission may deny an application for a project
that does not meet the applicable project criteria or that the
commission determines is not made in good faith, is not credible, or
is not in compliance with this chapter and the goals of this
chapter.
(d) Subject to availability of funds, the commission shall
award a grant under this subchapter in conjunction with the
execution of a contract that obligates the commission to make the
grant and the recipient to perform the actions described in the
recipient's grant application. The contract must incorporate
provisions for recapturing grant money in proportion to any loss of
emissions reductions compared with the volume of emissions
reductions that was projected in awarding the grant. Grant money
recaptured under the contract provision shall be deposited in the
fund and reallocated for other projects under this chapter.
SECTION 4. Section 391.002(b), Health and Safety Code, is
amended to read as follows:
(b) Projects that may be considered for a grant under the
program include:
(1) advanced clean energy projects, as defined by
Section 382.003;
(2) new technology projects that reduce emissions of
regulated pollutants from stationary sources;
(3) new technology projects that reduce emissions from
upstream, [and] midstream, or downstream oil and gas production,
completions, gathering, storage, processing, [and] transmission,
or refining activities through:
(A) the replacement, repower, or retrofit of
stationary compressor engines;
(B) the installation of systems to reduce or
eliminate the loss of gas, flaring of gas, or burning of gas using
other combustion control devices; or
(C) the installation of systems that reduce
flaring emissions and other site emissions; and
(4) electricity storage projects related to renewable
energy, including projects to store electricity produced from wind
and solar generation that provide efficient means of making the
stored energy available during periods of peak energy use.
SECTION 5. This Act takes effect September 1, 2023.
______________________________ ______________________________
President of the Senate Speaker of the House
I certify that H.B. No. 4885 was passed by the House on April
28, 2023, by the following vote: Yeas 108, Nays 37, 2 present, not
voting; and that the House concurred in Senate amendments to H.B.
No. 4885 on May 25, 2023, by the following vote: Yeas 127, Nays 13,
1 present, not voting.
______________________________
Chief Clerk of the House
I certify that H.B. No. 4885 was passed by the Senate, with
amendments, on May 23, 2023, by the following vote: Yeas 27, Nays
4.
______________________________
Secretary of the Senate
APPROVED: __________________
Date
__________________
Governor