The Senate Committee on Natural Resources and Economic Development met to receive an update from the Electric Reliability Council of Texas, Public Utility Commission of Texas, Railroad Commission of Texas, Texas Commission on Environmental Quality, and the Texas Water Development Board.
Public Utility Commission of Texas, Chairman Donna Nelson
- Customers throughout the competitive market can purchase products almost 30% below the last regulated rate in 2011
- Six out of thirteen projects have been implemented since the Sunset bill was enacted from last session
- Commission worked with Senator Nichols to determine resources needed to effectively regulate water and waste water needed to deliver services
- System Benefit Fund is set to expire in September 1, 2016
- As people cut landlines across the state, monetary resource funds are becoming more scarce
- Chairman Fraser pushed the bill which created CREZ – commission overbilled what he had envisioned for CREZ, so the committee might ask for more authority in this session
- EPA rules involve the PUC in a new, overbearing way – final rule will come out in mid-summer and commission will meet to see how it affects Texans
- Senator Lucio asked to expand on the outages in the Rio Grande Valley. How can the legislature address this issue to avoid outages during peak season?
- Growth happened so quickly there were limited transmission resources available at the time. Transmission lines are being built as quickly as possible with construction in the works.
Texas Commission on Environmental Quality, Bryan Shaw
- Regional Haze Program hopes to reduce haze levels back to natural conditions in specific areas (e.g. Wichita Mountains and Guadalupe River) by 2064
- Chairman Estes was interested in why Wichita Mountains was designated as a Class I site. He also recognized the need for TCEQ to streamline the permitting process.
- Why are other states’ permitting processes so much faster than Texas? Need to investigate.
- EPA plans to reject Texas’ plan to control regional haze – EPA wants control and potentially the shutdown of five coal-fired power plants
- Cost to implement EPA standards will reach $2 billion to reduce emissions
- Cross State Air Pollution Rule required Texas to reduce SO2 emissions by up to 48% – Texas was treated unfairly compared to other states involved in the ruling
- Mercury rule is in briefing in the Supreme Court and expected to be resolved by Spring 2015
- EPA will announce new sources and existing source rules as well as a federal plan by mid-summer
- Chairman Fraser recognized that if the EPA lowers its requirement for emission levels, certain Texas regions will be classified as non-attainment regions – state will be unable to acquire federal funds for transportation projects within the state
- Air quality in the Barnett Shale is relatively clean – greater focus on surrounding regions at risk
- Senator Lucio concerned with the air quality along the Texas-Mexico border – interested in how industrial growth has impacted El Paso region
- Chairman Fraser noticed there has been an unprecedented amount of attention from the EPA in recent years – seen as an attempt to lessen Texas’ economic development
Railroad Commission of Texas, Chairman Christi Craddick
- Texas produced 2.43 million barrels of oil a day and received 30,300 drilling permits in 2014
- Implemented an incentivized recycling rule within the commission to encourage companies to use brackish and recycled water in May 2014
- Senator Seliger recognized produced water should be examined more closely. Chevron and Conoco, among others have proactively incorporated recycling into their structure without abiding by a statutory rule – implemented without government force
- A seismologist has been hired in-house to work with industry to provide advice on saltwater disposal practices and evaluate disposal practices in use
- Inspectors have been sent to Irving to proactively identify at-risk locations
- Senator Hancock questioned whether there is a need to continue investigating Irving, since there is not a valid assumption to be made within the area – sheds unnecessary bad attention to the area
- Industry needs to continue to work with cities and secure a “social license to operate”
Electric Reliability Council of Texas, CEO Trip Doggett
- Capacity Demand Reserves (CDR) report recognizes the load will peak at 69,057 in 2015
- Senator Hancock asked for ERCOT to compare previous forecasts to the actual results
- Previous data overestimated the amount of electricity needed (by one percent) and has been reformulated to more accurately predict future results
- Estimates of available wind in peak summer was underestimated and has been changed to more closely reflect the production of wind turbines
Texas Water Development Board, Chairman Carlos Rubenstein
- Environmental review process called for more specific action plans and less permitting requests
- All sixteen regional water planning groups have been visited by the TWDB within the year
- Chairman Fraser applauded the proactive nature and redevelopment of the TWDB
- $800 million are available to fund water-related projects each year for the next ten years
- Deadline for first-round of applications is February 3
Committee rules adopted.