| 2 | 4 | | |
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| 3 | 5 | | |
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| 4 | 6 | | A BILL TO BE ENTITLED |
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| 5 | 7 | | AN ACT |
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| 6 | 8 | | relating to the development and expansion of clean hydrogen |
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| 7 | 9 | | production, distribution, and utilization in this state. |
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| 8 | 10 | | BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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| 9 | 11 | | SECTION 1. Chapter 490J, Government Code, is added to read |
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| 10 | 12 | | as follows: |
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| 11 | 13 | | Sec. 490J.001. CLEAN HYDROGEN DEVELOPMENT FUND. (a) The |
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| 12 | 14 | | Clean Hydrogen Development Fund is established as a special fund in |
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| 13 | 15 | | the state treasury to finance clean hydrogen projects. |
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| 14 | 16 | | (b) The fund shall be administered by the comptroller in |
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| 15 | 17 | | consultation with the Texas Commission on Environmental Quality and |
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| 16 | 18 | | the Texas Railroad Commission. |
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| 17 | 19 | | (c) Money in the fund may be used to provide: |
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| 18 | 20 | | (1) low interest loans for hydrogen infrastructure and |
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| 19 | 21 | | production facilities; |
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| 20 | 22 | | (2) state-backed bonds for the financing of hydrogen |
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| 21 | 23 | | projects; or |
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| 22 | 24 | | (3) state grants for hydrogen electrolyzer |
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| 23 | 25 | | manufacturing in this state. |
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| 24 | 26 | | (d) The fund may accept federal grants, private donations, |
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| 25 | 27 | | and legislative appropriations. |
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| 26 | 28 | | SECTION 2. Subchapter L, Chapter 171, Tax Code, is amended |
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| 27 | 29 | | by adding Section 171.603 to read as follows: |
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| 28 | 30 | | Sec. 171.603. CLEAN HYDROGEN TAX INCENTIVES. (a) A person |
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| 29 | 31 | | or business entity that constructs or operates a clean hydrogen |
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| 30 | 32 | | production facility in this state may be eligible for a state tax |
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| 31 | 33 | | credit. |
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| 32 | 34 | | (b) The credit shall be equivalent to 20 percent of |
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| 33 | 35 | | qualified capital expenditures related to hydrogen production, |
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| 34 | 36 | | transport, or storage. |
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| 35 | 37 | | (c) A manufacturer of hydrogen electrolyzers relocating to |
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| 36 | 38 | | Texas from out of state shall receive: |
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| 37 | 39 | | (1) a 10-year franchise tax exemption; and |
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| 38 | 40 | | (2) a sales tax exemption on equipment purchases used |
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| 39 | 41 | | in manufacturing. |
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| 40 | 42 | | (d) The comptroller shall adopt rules necessary for |
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| 41 | 43 | | implementation, including reporting requirements to track economic |
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| 42 | 44 | | impact. |
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| 43 | 45 | | SECTION 3. Chapter 502, Transportation Code, is amended by |
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| 44 | 46 | | adding Section 502.257 to read as follows: |
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| 45 | 47 | | Sec. 502.257. TEMPORARY HIGHWAY TAX RELIEF FOR HYDROGEN |
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| 46 | 48 | | VEHICLES. (a) Hydrogen-powered vehicles, including hydrogen |
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| 47 | 49 | | internal combustion engine and fuel cell vehicles, shall be exempt |
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| 48 | 50 | | from state highway use taxes for ten years or until cost parity with |
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| 49 | 51 | | conventional energy sources is reached, as determined by the Texas |
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| 50 | 52 | | Commission on Environmental Quality. |
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| 51 | 53 | | (b) The exemption applies to commercial trucking, rail, |
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| 52 | 54 | | shipping, and aviation operators. |
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| 53 | 55 | | SECTION 4. Chapter 136, Education Code, is amended by |
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| 54 | 56 | | adding Section 136.008 to read as follows: |
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| 55 | 57 | | Sec. 136.008. WORKFORCE DEVELOPMENT INITIATIVES. (a) The |
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| 56 | 58 | | Texas Workforce Development Commission shall establish |
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| 57 | 59 | | partnerships with universities, technical schools, or community |
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| 58 | 60 | | colleges to provide specialized training for hydrogen sector jobs. |
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| 59 | 61 | | (b) The Workforce Commission may provide grants to |
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| 60 | 62 | | educational institutions to develop curriculum and certification |
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| 61 | 63 | | programs for hydrogen technology. |
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| 62 | 64 | | SECTION 5. This Act takes effect immediately if it receives |
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| 63 | 65 | | a vote of two-thirds of all the members elected to each house, as |
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| 64 | 66 | | provided by Section 39, Article III, Texas Constitution. If this |
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| 65 | 67 | | Act does not receive the vote necessary for immediate effect, this |
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| 66 | 68 | | Act takes effect September 1, 2025. |
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