House Energy Resources met to take up a number of bills. This report covers HB 618 (Darby), HB 1302 (Geren), HB 1915 (Hefner), HB 3837 (Geren), HB 2263 (Darby), and HB 33 (Landgraf).
This report is intended to give you an overview and highlight the various topics taken up. It is not a verbatim transcript of the discussions but is based upon what was audible or understandable to the observer and the desire to get details out as quickly as possible with few errors or omissions.
HB 618 (Darby) Relating to the treatment, recycling for beneficial use, or disposal of drill cuttings
- Darby – Virtually the same as HB 964 last session which passed 144-2 in the house; extends the law to encourage commercial recycling with clean facilities regulated by the RRC
- Liability shield apply to operators recycling/disposing
- Are required to have post closure financial assurance bonds and insurance
Matthew King, Republic Services – For
- Support the bill
Cyrus Reed, Sierra Club – For
- Concern was it would include produced water, but author’s office has reassured us it does not
HB 618 left pending
HB 1302 (Geren) Relating to inspections and examinations by the Railroad Commission of Texas of certain sites and facilities conducted using unmanned aircraft
- Geren – Bill is to allow RRC to use drones for inspection/examine purposes oil and gas site or facility including a well, tank, disposal, injection site, surface mining site, among others
Cyrus Reed, Sierra Club – For
- Support the bill; majority do comply, but is a tool to use for those who do not comply
HB 1302 left pending
HB 1915 (Hefner) Relating to land services performed by a landman
- Hefner – Have a CS; bill is a cleanup to the definition of land work and landman
- Land services definition harmonized with scope of the American Association of Professional Landmen; includes “other energy sources”
- Does not expand land services
- Recommend this goes to local and consent
Mark DeVrient, AAPL – For
- Is a cleanup bill to standardize what other landmen are doing
- Zwiener – This is just covering what is already in practice; does not preclude those who do not officially identify as a landman?
- Correct
Carl Campbell, AAPL – For
- Support the bill
- Zwiener – How common for landmen to support different kinds of energy?
- Is common as expansion of energy types come into the market
- Includes solar, geothermal; is an expansion, not a contraction
HB 1915 left pending
HB 3837 (Geren) Relating to the designation of advanced clean energy projects
- Geren – Use has increased on the global scale; statutory designation expired in 2020, addresses Texas Emission Reduction Plan
Bruce Selkirk, Nacero Inc – For
- Are at the forefront to manufacture sustainable aviation jet fuel to meet global demand to have cleaner jet fuel
- Companies like Nacero will help Texas be a leader in this industry; would be the first of its kind in the United States
Adrian Shelley, Public Citizen – Neutral
- Current definition requires efficiency of 2pmm of nitrogen oxides, seems like this bill replace/supplants that; suggest it does not
- Carbon capture requirements has been increased to 90%, recommend it is increased to 95%
Geren, in closing
- Want to address questions from the last witness
- 90% is all we are, but they will get to 95% by themselves; it does replace available control tech requirements
HB 2263 (Darby) Relating to the authority of a natural gas local distribution company to offer energy conservation programs
- Darby – Have a CS; bill addresses an underutilized program to reduce energy consumption to save money on their bills
- Allows LDCs to develop energy conservation programs on a statewide basis to reduce consumption of natural gas as approved by RRC
- RRC has jurisdiction, cost recovery mechanisms, and LDCs will reimburse RRC for administration of these programs
- Zwiener – Know how many would benefit from this?
- Do not know
- Prevent a city from going above and beyond the provided program
- As long as it is approved by the RRC
Adrian Shelley, Public Citizen – For
- Support the bill; recommend bill language changed from “exclusive” to “primary” in terms of RRC’s regulation
- Concerned about the cost recovery provisions and lost marginal revenues; should have rate payers participating in cost recovery
- Do not support carbon offsets cost recovery
Jasmine King Bush, Texas Gas Service – For
- Would enable companies to develop and implement programs that fit customer needs and help reduce energy consumption
Cyrus Reed, Sierra Club – For
- Support the bill, is a good first step
- Question about cities who already have franchise agreements/requirements; recommend a transition to ensure those programs already in place are protected
- Want to make sure if it is not undergoing a full ratemaking, need to make sure there is public input on those programs
- Require a third-party contract to determine if these programs deliver on their promises, suggest something similar for gas
Jason Ryan, CenterPoint Energy – For
- Support this bill
- In Harris have more customers outside of an incorporated city than inside that would benefit from the framework in this bill
- Zwiener – Have concerns that some areas have a reduction in standards of their existing energy conservation plan
- Bill does not relieve companies of obligations in franchise agreements; would not be opposed to clarify that
- Zwiener – Prevents any
- Does not; exclusive jurisdiction in the bill is talking about those under our service area
- Zwiener – Framework does not set a minimum?
- Correct in terms of negotiations in a franchise setting
Kenneth Flippin, U.S. Green Building Council – For
- Important step in the right direction
Darby, in closing
- Will make additional changes to the bill
HB 2263 left pending
HB 33 (Landgraf) Relating to the enforcement of certain federal laws regulating oil and gas operations within the State of Texas
- Mirrors EO 33 from Governor Abbott directing state agencies to challenge federal laws that regulate oil and gas operations
- Prohibits agencies from contracting with federal agencies with regard of implementing regulations/rules if not already existing in state law
- Identical to a bill that passed the house 110-33 last session
Tom Glass, Texas Constitutional Enforcement – For
- Support the bill as it protects from federal overreach
- Is similar to Holland’s HB 2622 concerning the regulation of guns
Adrian Shelley, Public Citizen – Against
- Have a public health crisis related to the combustion of fossil fuels; need to solve this at all levels of government
- Are good regulations to address this including supplemental methane rule
- Would be leaving a lot of useful federal funds
Cyrus Reed, Sierra Club – Against
- Want our state agencies to be in cooperation with the federal government
- Are federal regulations coming down the line to protect public health including those relating to PM 2.5s
- Law could jeopardize important relationship/funds from the federal government
Landgraf, in closing
- Grant funding would still be offered under state law as would cooperation
HB 33 left pending
HB 1158 (Darby) Relating to advanced clean energy projects and certain other projects that reduce or eliminate carbon dioxide emissions
- Darby – Have a CS; removes increase of capture rate, inclusion of CO2 emissions to allow flaring to be addressed standalone, adds lang to ensure direct air capture is include, allows renewable projects to produce hydrogen
Adrian Shelley, Public Citizen – Against
- Do not think we should try to access TERP for carbon funds
- Previously supported the 90% sequestration, was taken out of the CS
- Support direct air capture and addition of green hydrogen
Virginia Palacios, Commission Shift – Neutral
- Suggested current standards at 50% should prioritize funds on those that are high performing; federal standards are at 75%
- Recommend at 95% standard
- Need to ensure the storage sequestration standard is not stricken
- Anchía – Difference between a project that sequesters 50% versus 75%? Why 95%?
- Is about design of an efficient/economic facility; want to incentivize the best of the best
- Anchía – Asks about what the program does
- Impression is for carbon credits to be sold in a secondary market
Cyrus Reed, Sierra Club – Against
- Not against capturing carbon or section 1 of the bill
- Given high ozone amounts in large cities in the state, should focus TERP on reducing NOx and VOCs; would be fine with other sections of the bill
- Anchía – Know how much in the TERP?
- $250m a year
- Darby – $1.8b
Elenor Kim, Occidental Petroleum Corporation – For
- Support the bill
- Anchía – Have thoughts on whether it should be 50% or 75%?
- Do not
- Zwiener – Should be pursuing other sources of funding for this as well?
- Outside of my expertise
Jeremy Mazur, Texas 2036 – For
- Energy portfolio is expanding and will result in the delivery of more/cleaner/new energy
- Bill shows the state is willing to put skin in the game
- Anchía – Maturity of this marketplace? Know the right bar to carbon threshold set at?
- Carbon capture more mature than hydrogen; market is missing for carbon capture to work
- 50% clearly captures a broader universe of carbon
- Anchía – Is about finding about where the market can stretch
- Think carbon capture is essential to expansion; need to maximize value
- Zwiener – Have any sense of the federal resources we could tap into? Want to ensure we are getting into every resource we can
- IIJA has ambitious grant programs and expansion of the 45 Q tax credit
Darby, in closing
- Will continue to work with stakeholders to find the right slot for this
- Is time we utilized and access TERP funds
HB 1158 left pending