By: Hall S.B. No. 1979
A BILL TO BE ENTITLED
AN ACT
relating to renewable energy generation facilities; authorizing
fees.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subchapter C, Chapter 15, Utilities Code, is
amended by adding Section 15.053 to read as follows:
Sec. 15.053. COMPLAINT REGARDING RENEWABLE ENERGY
GENERATION FACILITIES. (a) An affected person may complain to the
commission in writing setting forth an act or omission by an owner
or operator of renewable generation in violation or claimed
violation of Subchapter F, Chapter 35.
(b) The commission shall keep for a reasonable period an
information file about each complaint filed with the commission
relating to an owner or operator of battery energy storage.
(c) The commission, at least quarterly and until final
disposition of the written complaint, shall notify the parties to
the complaint of the status of the complaint unless the notice would
jeopardize an undercover investigation.
SECTION 2. Chapter 35, Utilities Code, is amended by adding
Subchapter F to read as follows:
SUBCHAPTER F. RENEWABLE ENERGY GENERATION FACILITY PERMIT
Sec. 35.201. DEFINITIONS; APPLICABILITY. (a) In this
subchapter:
(1) "Battery energy storage facility" includes a
facility or equipment used to support the operation of battery
energy storage, including an underground or aboveground electrical
transmission or communications line, an electric transformer,
telecommunications equipment, a road, a meteorological tower, or a
maintenance yard.
(2) "Battery energy storage facility agreement" means
a lease agreement between a grantee and a landowner that authorizes
the grantee to operate a battery energy storage facility on the
leased property.
(3) "Grantee" means a person who:
(A) leases property from a landowner; and
(B) operates a battery energy storage facility on
the property.
(4) "Permit holder" means a person who holds a permit
issued under this subchapter.
(5) "Person" includes an electric cooperative and a
municipally owned utility.
(6) "Renewable energy generation facility" for
purposes of this chapter means:
(A) a wind power facility as defined by Section
301.0001;
(B) a solar power facility as defined by Section
302.0001;
(C) a battery energy storage facility; or
(D) a facility that generates electric energy
using a renewable energy technology, as defined by Section 39.916,
Utilities Code, other than a technology that relies exclusively on
wind or solar energy.
(b) The permit requirements of this subchapter apply to a
renewable energy generation facility regardless of whether the
facility is the subject of a facility agreement entered into under
Chapter 301 or 302 or this subchapter.
(c) This subchapter applies only to a renewable energy
generation facility that is intended to be used to sell energy or
ancillary services at wholesale.
Sec. 35.202. PERMIT REQUIRED. (a) A person may not
interconnect a renewable energy generation facility to a
transmission facility unless the person holds a permit to operate a
renewable energy generation facility issued by the commission under
this subchapter.
(b) The commission by rule shall require each permitted
renewable energy generation facility to be installed only in a
location that:
(1) for a solar power facility, is at least:
(A) 500 feet from any property line, unless the
permit holder has obtained a written waiver from each owner of
property located less than 500 feet from the permitted facility;
and
(B) 500 feet from any habitable structure, unless
the permit holder has obtained a written waiver from each owner of
the habitable structure;
(2) for a wind power facility, is at least twice the
height of the wind turbine, including the blades of the turbine,
from the property line of each property that borders the property on
which the permitted facility is located, unless the permit holder
has obtained a written waiver from each owner of property located in
the applicable area; and
(3) for a battery energy storage facility, is at
least:
(A) 500 feet from any property line, unless the
permit holder has obtained a written waiver from each owner of
property located less than 500 feet from the permitted facility;
and
(B) 500 feet from:
(i) public ways;
(ii) buildings;
(iii) stored combustible materials;
(iv) hazardous materials;
(v) high-piled stock; and
(vi) other exposure hazards not associated
with electrical grid infrastructure.
(c) The commission by rule shall require each permitted
renewable energy generation facility to be installed only in a
location that, in the event of an emergency at the site of the
permitted renewable energy generation facility, will not block the
only access point to a residential area. If an emergency could block
access to a residential area, a different access point to the
facility must be constructed.
(d) A person may apply for a permit under this subchapter by
filing with the commission:
(1) a description of the proposed location of the
renewable energy generation facility;
(2) a description of the type of renewable energy
generation facility;
(3) a statement identifying the fire department, as
defined by Section 419.021, Government Code, volunteer fire
department, fire marshal, or other first responder entity that may
reasonably be expected to be the primary first responder to a fire
at the location of the renewable energy generation facility;
(4) a statement that the person has provided written
notice to the entity identified in Subdivision (3) of the
applicant's intent to install a renewable energy generation
facility;
(5) evidence of insurance coverage sufficient to
insure against losses arising from the operation of the renewable
energy generation facility; and
(6) any other information required by commission rule.
(e) When an application for a permit, or an amendment to a
permit issued under this section, is filed, the commission shall
give notice of the application to the county judge of the county in
which all or a majority of the renewable energy generation facility
is proposed to be located. The county shall publish the notice on
their website in perpetuity and, in accordance with Chapter 2051,
Government Code, in a newspaper for a minimum of three consecutive
days.
(f) The commission may hold one or more public meetings on a
permit application in the county in which the renewable energy
generation facility is proposed to be located. The commission
shall hold a public meeting:
(1) on the request of a member of the legislature who
represents the area in which the renewable energy generation
facility is proposed to be located; or
(2) if the commission determines there is substantial
public interest in the proposed permit.
(g) The commission by order or rule may delegate to the
executive director or another commission employee the authority to
hold a public meeting under this section.
(h) The commission may approve an application for a permit
only if the commission finds that:
(1) issuance of the permit would not violate state or
federal law; and
(2) the location of the proposed renewable energy
generation facility complies with rules adopted under Subsections
(b) and (c).
(i) The commission by rule shall adopt a fee to be imposed on
each permit applicant to cover costs associated with implementing
this section.
(j) For purposes of this subchapter:
(1) a provision of Subchapter B or E, Chapter 14, that
authorizes the commission to regulate a public utility also applies
to a person required to obtain a permit under this section,
including an electric cooperative or a municipally owned utility;
and
(2) a reference in Chapter 15 to a person includes a
person required to obtain a permit under this section, including an
electric cooperative or a municipally owned utility.
Sec. 35.203. FIRE SAFETY STANDARDS FOR BATTERY ENERGY
STORAGE. (a) The commission shall adopt and periodically update
fire safety standards and testing requirements for battery energy
storage operating under a permit issued under this subchapter. The
standards and requirements must be based on:
(1) model code requirements for battery energy storage
established by UL Solutions, such as UL 9540 and UL 9540A
performance criteria;
(2) minimum standards related to the installation,
design, and maintenance of stationary energy storage systems and
electrical equipment established by the National Fire Protection
Association, such as NFPA 70 and NFPA 855;
(3) fire hazard management standards, such as the
International Fire Code and NFPA 1;
(4) explosion prevention and mitigation standards,
such as NFPA 68 and NFPA 69;
(5) fire and explosion prevention standards for
battery energy storage that is integrated with a photovoltaic
energy system, such as NFPA 585;
(6) lithium ion battery safety standards, such as UL
1642; and
(7) industry best practices for security fencing and
signage near battery energy storage.
(b) Each permit holder that owns or operates permitted
battery energy storage shall ensure that the storage meets the fire
safety standards and testing requirements adopted by the commission
under Subsection (a) at the time of interconnection.
(c) On request by a municipality in which the battery energy
storage is located, or a county in which the battery energy storage
is located if the storage is in an unincorporated area, the permit
holder shall contract at the permit holder's expense with an
independent, third-party engineer licensed in this state to:
(1) evaluate the design, safety, and installation of
the battery energy storage to ensure compliance with the
requirements of this section;
(2) produce a written report on the evaluation; and
(3) provide the written report described by
Subdivision (2) to the requesting municipality or county.
Sec. 35.204. EMERGENCY OPERATIONS PLANS FOR RENEWABLE
ENERGY GENERATION FACILITIES. (a) This section applies to a permit
holder that owns or operates a renewable energy generation
facility.
(b) A permit holder to which this section applies shall file
with the commission a site-specific emergency operations plan for
each facility owned or operated by the permit holder, including
emergency response and communications protocols for an equipment
failure incident.
(c) The permit holder shall offer to local fire departments
training regarding responding to a fire at the facility.
Sec. 35.205. EVIDENCE OF COMPLIANCE WITH STANDARDS.
Evidence of compliance with state or local regulations is not
sufficient to support a finding by a trier of fact that an owner or
operator of renewable generation equipment or facilities was not
negligent in an action arising out of a malfunction of or mitigation
of a fire caused by renewable generation equipment or facilities.
Sec. 35.206. WAIVER VOID; REMEDIES. (a) A provision of a
renewable generation facility agreement that purports to waive a
right or exempt a grantee from a liability or duty established by
Section 35.207 or 35.208 is void.
(b) A person who is harmed by a violation of Section 35.207
or 35.208 is entitled to appropriate injunctive relief to prevent
further violation of Section 35.207 or 35.208.
(c) The provisions of this section are not exclusive. The
remedies provided in this section are in addition to any other
procedures or remedies provided by other law.
Sec. 35.207. REQUIRED AGREEMENT PROVISIONS ON FACILITY
REMOVAL. (a) A renewable generation facility agreement must
provide that the grantee is responsible for removing the grantee's
renewable generation facilities from the landowner's property and
that the grantee shall, in accordance with any other applicable
laws or regulations, safely:
(1) clear, clean, and remove from the property each
piece of renewable generation equipment, including any
transformers or substations;
(2) for each foundation of renewable generation
equipment, including a transformer or substation installed in the
ground:
(A) clear, clean, and remove the foundation from
the ground to a depth of at least three feet below the surface grade
of the land in which the foundation is installed; and
(B) ensure that each hole or cavity created in
the ground by the removal is filled with topsoil of the same type or
a similar type as the predominant topsoil found on the property;
(3) for each buried cable, including power,
fiber-optic, and communications cables, installed in the ground:
(A) clear, clean, and remove the cable from the
ground to a depth of at least three feet below the surface grade of
the land in which the cable is installed; and
(B) ensure that each hole or cavity created in
the ground by the removal is filled with topsoil of the same type or
a similar type as the predominant topsoil found on the property; and
(4) clear, clean, and remove from the property each
overhead power or communications line installed by the grantee on
the property.
(b) The agreement must provide that, at the request of the
landowner, the grantee shall:
(1) clear, clean, and remove each road constructed by
the grantee on the property; and
(2) ensure that each hole or cavity created in the
ground by the removal is filled with topsoil of the same type or a
similar type as the predominant topsoil found on the property.
(c) The agreement must provide that, at the request of the
landowner, if reasonable, the grantee shall:
(1) remove from the property all rocks over 12 inches
in diameter excavated during the decommissioning or removal
process;
(2) return the property to a tillable state using
scarification, V-rip, or disc methods, as appropriate; and
(3) ensure that:
(A) each hole or cavity created in the ground by
the removal is filled with topsoil of the same type or a similar
type as the predominant topsoil found on the property; and
(B) the surface is returned as near as reasonably
possible to the same condition as before the grantee dug holes or
cavities, including by reseeding pastureland with native grasses
prescribed by an appropriate governmental agency, if any.
(d) The landowner shall make a request under Subsection (b)
or (c) not later than the 180th day after the later of:
(1) the date on which the renewable generation
facility is no longer capable of generating or storing electricity
in commercial quantities; or
(2) the date the landowner receives written notice of
intent to decommission the renewable generation facility from the
grantee.
Sec. 35.208. REQUIRED AGREEMENT PROVISIONS ON FINANCIAL
ASSURANCE. (a) A renewable generation facility agreement must
provide that the grantee shall obtain and deliver to the commission
evidence of financial assurance payable to the landowner that
conforms to the requirements of this section to secure the
performance of the grantee's obligation to remove the grantee's
renewable generation facilities located on the landowner's
property as described by Section 35.207. The financial assurance
may be a bond or another form of financial assurance acceptable to
the landowner.
(b) The amount of the financial assurance must be at least
equal to the estimated amount by which the cost of removing the
renewable generation facilities from the landowner's property and
restoring the property to as near as reasonably possible the
condition of the property as of the date the agreement begins
exceeds the salvage value of the renewable generation facilities,
less any portion of the value of the renewable generation
facilities pledged to secure outstanding debt.
(c) The agreement must provide that:
(1) the estimated cost of removing the renewable
generation facilities from the landowner's property and restoring
the property to as near as reasonably possible the condition of the
property as of the date the agreement begins, and the estimated
salvage value of the renewable generation facilities must be
determined by an independent, third-party professional engineer
licensed in this state;
(2) the grantee must deliver to the landowner and the
commission an updated estimate, prepared by an independent,
third-party professional engineer licensed in this state, of the
cost of removal and the salvage value at least once every five years
for the remainder of the term of the agreement; and
(3) the grantee is responsible for ensuring that the
amount of the financial assurance remains sufficient to cover the
amount required by Subsection (b), consistent with the estimates
required by this subsection.
(d) The grantee is responsible for the costs of obtaining
financial assurance described by this section and costs of
determining the estimated removal costs and salvage value.
(e) The agreement must provide that the grantee shall
deliver the financial assurance to the commission not later than
the 30th day after the date the agreement begins, or the permit may
be denied or revoked.
(f) The grantee may not cancel financial assurance before
the date the grantee has completed the grantee's obligation to
remove the grantee's renewable generation facilities located on the
landowner's property as required by this chapter, unless the
grantee provides the commission with replacement financial
assurance at the time of or before the cancellation. In the event
of a transfer of ownership of the grantee's renewable generation
facilities, the financial security provided by the grantee shall
remain in place until the date evidence of financial security
meeting the requirements of this chapter is provided to the
commission.
Sec. 35.209. RELEASE OF FINANCIAL ASSURANCE TO GRANTEE.
(a) At any time, a grantee may file an application with the
commission for the release of all or part of a bond or other
financial assurance provided to the commission by the grantee for a
landowner under this subchapter.
(b) The application must be on a form prescribed by the
commission and, in addition to other information the commission may
require, must include the type and the approximate date of removal
and restoration work performed and a description of the results
achieved.
(c) The grantee shall provide a copy of the application to
the landowner not later than the 30th day after the date the grantee
files the application with the commission.
(d) Not later than the 45th day after the date the grantee
files the application, the commission shall conduct an inspection
and evaluation of the removal and restoration work performed.
(e) The commission may release all or part of the financial
assurance if the commission determines that the grantee has
completed all or part of the grantee's obligations under the
agreement entered into under this subchapter. All of the financial
assurance shall be released if all of the grantee's obligations are
completed.
(f) If the commission disapproves the application for
release of the financial assurance, the commission shall notify the
grantee in writing of the reasons for disapproval and recommend
corrective actions necessary to secure the release of the financial
assurance.
Sec. 35.210. FORFEITURE OF FINANCIAL ASSURANCE TO
LANDOWNER. (a) A landowner may file an application with the
commission for the forfeiture of all or part of a bond or other
financial assurance provided to the commission by a grantee for the
landowner under this subchapter if:
(1) the grantee has not completed the grantee's
obligations under the agreement entered into under this subchapter;
and
(2) the facility that is the subject of the agreement
is no longer being used by the grantee to provide energy or
ancillary services at wholesale for a power grid in the manner
provided by the agreement.
(b) The application must be on a form prescribed by the
commission.
(c) The landowner shall provide a copy of the application to
the grantee not later than the 30th day after the date the landowner
files the application with the commission.
(d) Not later than the 45th day after the date the landowner
files the application, the commission shall conduct an inspection
and evaluation of the property for which the financial assurance
was provided.
(e) The commission may approve the forfeiture of all or part
of the financial assurance if the commission determines that:
(1) the facility that is the subject of the agreement
is no longer being used in the manner described by Subsection
(a)(2); and
(2) the forfeiture is necessary to compensate the
landowner for any remaining removal and restoration work the
grantee was required to but did not complete under the agreement.
(f) If the commission disapproves the application for
forfeiture of the financial assurance, the commission shall notify
the landowner in writing of the reasons for disapproval.
Sec. 35.211. COMMISSION AUTHORITY. (a) The commission may
not issue to a grantee whose financial assurance was forfeited
under Section 35.210 any permit, certificate, or registration under
other law that authorizes the grantee to operate a generation
facility to which this subchapter applies or renew any such permit,
certificate, or registration.
(b) In a suit for receivership, garnishment, or bankruptcy,
or in any other legal action affecting the assets of a grantee that
is a party to an agreement subject to this subchapter, the
commission may:
(1) inform the appropriate court and parties of the
commission's interest in obtaining notice of the proceedings; and
(2) within the time prescribed by the applicable
statutes, rules, and court orders, intervene and participate in any
proceedings that affect a landowner not joined in the suit who is a
party to the agreement with the grantee.
SECTION 3. The changes in law made by this Act apply only to
a renewable generation facility agreement entered into on or after
the effective date of this Act. An agreement entered into before
the effective date of this Act is governed by the law applicable to
the agreement on the date the agreement was entered into, and that
law is continued in effect for that purpose.
SECTION 4. As soon as practicable after the effective date
of this Act, the Public Utility Commission of Texas shall adopt
rules to effectuate the changes in law made by this Act.
SECTION 5. This Act takes effect immediately if it receives
a vote of two-thirds of all the members elected to each house, as
provided by Section 39, Article III, Texas Constitution. If this
Act does not receive the vote necessary for immediate effect, this
Act takes effect September 1, 2025.