Enrolled Bill Summary

House Bill 2201	House Author:  Hughes et al.
Effective:  6-18-05	Senate Sponsor:  Estes

            House Bill 2201 amends the Government Code, Water Code, Health and Safety Code, and Tax Code to make various changes in the law to better position Texas to be selected for the U.S. Department of Energy's (DOE) proposed clean coal demonstration project for electric power plants, known as FutureGen.  The bill  authorizes the governor to allocate appropriations to the Texas Emerging Technology Fund, and certain proceeds deposited in that fund, to provide matching money for a FutureGen clean coal project, provided that the lieutenant governor and speaker of the house give prior approval.  The bill adds to the energy demonstration program supervisory duties of the state energy conservation office (SECO), situated with the comptroller of public accounts, to assign it grant distribution responsibilities relating to FutureGen project components as well as gasification projects for coal and biomass mixtures and other low‑emission energy applications.  Contingent on the selection of a FutureGen site in Texas, the bill directs SECO to distribute to the project managing entity an amount equal to 50 percent of private industry investment, up to a maximum cumulative distribution of $20 million.  The General Appropriations Act appropriates $2 million from general revenue to SECO for a response to the DOE's request for proposals (RFP) on FutureGen.

            The bill directs the Texas Water Development Board to provide for reasonable flexibility for regional and state water plan changes to facilitate planning for FutureGen water supplies.  It assigns the Railroad Commission of Texas jurisdiction over associated carbon dioxide sequestration by injection into oil, gas, or geothermal reservoirs, and assigns the Texas Commission on Environmental Quality (TCEQ) jurisdiction over carbon dioxide sequestration injection into other formations below the base of usable quality water.  The bill directs the TCEQ to implement reasonably streamlined processes for certain FutureGen air quality permitting, and provides that such processes are not subject to contested case requirements.  It gives deference to DOE specification, in the RFP or project contract request, of an emissions profile of allowable air contaminants for a FutureGen component. Absent such DOE specification, the bill sets maximum emissions for mercury, nitrogen oxides, particulates, and sulfur content.  The bill allows a corporate franchise tax deduction for certain costs involving a FutureGen clean coal project in Texas and amends the Texas Economic Development Act to allow school district property tax incentives for such a project or for a gasification project for a coal and biomass mixture.