The House Committee on Energy Resources interim report to the 88th Legislature covers Winter Strom Uri recovery, natural gas weatherization, increasing oil and gas production in Texas, expanding underground storage capacity, and emerging energy sources. For more information see the full report here.
Spotlight on Recommendations
Charge 1. Monitor the agencies and programs under the Committee’s jurisdiction and oversee the implementation of relevant legislation passed by the 87th Legislature, including HB 1520, relating to extraordinary costs incurred by gas utilities relating to Winter Storm Uri and the authority to issue bonds and impose fees and assessments; HB 3648, which requires the designation of certain natural gas facilities as critical customers or critical gas suppliers during energy emergencies; and SB 3, relating to preparing for, preventing, and responding to weather emergencies and power outages. (Joint charge with Committee on State Affairs)
- The Committee recommends that stakeholders, industry, agency, and the legislature continue to monitor developments with the Texas energy grid and market. It is imperative to assess any shortfalls or weaknesses that any event exacerbates within the State’s energy infrastructure. If a discrepancy is found, communication between the aforementioned entities is key in properly, adequately, and efficiently finding a solution.
Charge 2. Assess efforts made by the Railroad Commission and the Texas Energy Reliability Council to weatherize infrastructure and ensure reliability of the natural gas delivery system during times of disaster.
- The Committee found that the Railroad Commission is actively working to efficiently and properly initiate rulemakings which accomplish the goals set for them through Senate Bill 3. During their rulemaking process, the Railroad Commission has received extensive comments from both individuals and industry. Testimony shows that as these rulemakings are released, industries which participate and contribute to the natural gas supply chain are adjusting their practices to ensure compliance with these changes.
Charge 3. Examine ways to increase the production of oil and gas within the state. Review state and local regulations that could directly impact the exploration or production of oil and gas and make recommendations for increasing Texas’ energy independence.
- To ensure this industry is robust enough to meet demand, Texas must continue to find ways to incentivize growth and innovation. Testimony revealed that one of the biggest problems with oil and gas production in Texas is the availability of tubular goods as a result of federal policy limiting importation of steel pipe. This limitation has already proven to hinder this industry and a curtailment of goods such as steel not only harms the industry but also has resonating effects on Texas jobs, economy, and stability.
- Supply chain complications are just part of the problem. Texas must continue to create a regulatory environment that does not curtail growth and investment into this industry. An overregulated oil and gas sector would have negative implications that will be felt globally. Continuing to review state and local regulations to ensure that these policies are responsible, appropriate, and not overly burdensome will continue allowing Texas to be a global leader in oil and gas production and innovation.
Charge 4. Explore options for expanding the state’s underground natural gas storage capacity, including using excess storage capacity for carbon capture opportunities and the creation of a strategic natural gas reserve for the state.
- The Committee finds that expanding the state’s underground storage capacity for natural gas and carbon capture provides extensive benefits to Texas. As the State continues to be a leader in natural gas production and exportation, natural gas storage capacity must be expanded to satisfy the rising demand. By utilizing existing infrastructure to store natural gas underground, industry is able to increase their efficiency, create jobs and provide global benefits to countries who rely on Texas natural gas exportation. The benefit of using underground storage for carbon capture opportunities creates additional jobs, boosts the economy, and provides an important benefit to the environment.
Charge 5. Evaluate innovative and emerging energy sources. Identify and make recommendations to address legislative or regulatory obstacles to the use, development, and deployment of viable innovative and emerging energy sources.
- The committee highlighted testimony from Todd Staples with the Texas Oil and Gas Association. Staples explained that as Texas grows, it is imperative that conventional energy resources are continuously developed. For more details, see the interim report here.
