Bill Text: TX HB4885 | 2023-2024 | 88th Legislature | Comm Sub

NOTE: There are more recent revisions of this legislation. Read Latest Draft

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Bill Title: Relating to programs established and funded under the Texas emissions reduction plan.

Spectrum: Moderate Partisan Bill (Republican 4-1)

Status: (Passed) 2023-06-13 - Effective on 9/1/23 [HB4885 Detail]

Download: Texas-2023-HB4885-Comm_Sub.html

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88R21958 JRR-F
By: Landgraf H.B. No. 4885
Substitute the following for H.B. No. 4885:
By: Landgraf C.S.H.B. No. 4885

A BILL TO BE ENTITLED
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 $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 obtained through wind and other renewable
energy resources 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 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 vehicles or
heavy-duty equipment with newer on-road or non-road hydrogen
vehicles or equipment;
(4) the repower of on-road or non-road vehicles or
heavy-duty equipment with engines that run on or are powered by
hydrogen; and
(5) use of hydrogen fuel.
(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.
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, or [and] transmission
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. Sections 394.005(a), (b), and (c), Health and
Safety Code, are amended to read as follows:
(a) The commission shall establish criteria for
prioritizing qualifying vehicles eligible to receive grants under
this chapter. The commission shall review and revise the criteria
as appropriate. The criteria must prioritize the awarding of
grants under this chapter in the following order:
(1) qualifying vehicles for which not less than 75
percent of the annual use of the vehicle, either in terms of mileage
or fuel use as determined by the commission, will occur in the clean
transportation zone;
(2) qualifying vehicles not described by Subdivision
(1) for which not less than 75 percent of the annual use of the
vehicle, either in terms of mileage or fuel use as determined by the
commission, will occur in:
(A) counties in which an interstate highway is
located; or
(B) a combination of counties described by
Paragraph (A) and the clean transportation zone; and
(3) qualifying vehicles not described by Subdivision
(1) or (2) that will produce the greatest emissions reductions.
(b) To be eligible for a grant under the program:
(1) the use of the qualifying vehicle must be
projected to result in a reduction in emissions of nitrogen oxides
of at least 25 percent as compared to the motor vehicle or engine
being replaced, based on:
(A) the baseline emission level set by the
commission under Subsection (g); and
(B) the certified emission rate of the qualifying
vehicle; and
(2) the qualifying vehicle must:
(A) replace a heavy-duty or medium-duty motor
vehicle that:
(i) is an on-road vehicle that has been
owned, leased, or otherwise commercially financed and registered
and operated by the applicant in Texas for at least the two years
immediately preceding the submission of a grant application;
(ii) satisfies any minimum average annual
mileage or fuel usage requirements established by the commission;
(iii) satisfies any minimum percentage of
annual usage requirements established by the commission; and
(iv) is in operating condition and has at
least two years of remaining useful life, as determined in
accordance with criteria established by the commission;
(B) replace a heavy-duty or medium-duty motor
vehicle that:
(i) is owned by the applicant;
(ii) is an on-road vehicle that has been:
(a) owned, leased, or otherwise
commercially financed and operated in Texas as a fleet vehicle for
at least the two years immediately preceding the submission of a
grant application; and
(b) registered in Texas [a county
located in the clean transportation zone] for at least the two years
immediately preceding the submission of a grant application; and
(iii) otherwise satisfies the mileage,
usage, and useful life requirements established under Paragraph (A)
as determined by documentation associated with the vehicle; or
(C) be a heavy-duty or medium-duty motor vehicle
repowered with a natural gas engine that:
(i) is installed in an on-road vehicle that
has been owned, leased, or otherwise commercially financed and
registered and operated by the applicant in Texas for at least the
two years immediately preceding the submission of a grant
application;
(ii) satisfies any minimum average annual
mileage or fuel usage requirements established by the commission;
(iii) satisfies any minimum percentage of
annual usage requirements established by the commission; and
(iv) is installed in an on-road vehicle
that, at the time of the vehicle's repowering, was in operating
condition and had at least two years of remaining useful life, as
determined in accordance with criteria established by the
commission.
(c) As a condition of receiving a grant, the qualifying
vehicle must be continuously owned, leased, or otherwise
commercially financed and registered and operated in the state by
the grant recipient until the earlier of the fourth anniversary of
the activity start date established by the commission or the date
the vehicle has been in operation for 400,000 miles after the
activity start date established by the commission. [Not less than
75 percent of the annual use of the qualifying vehicle, either
mileage or fuel use as determined by the commission, must occur in
the clean transportation zone.]
SECTION 6. The change in law made by this Act applies only
to a grant awarded on or after the effective date of this Act. A
grant awarded before the effective date of this Act is governed by
the law in effect on the date the award was made, and the former law
is continued in effect for that purpose.
SECTION 7. This Act takes effect September 1, 2023.