HBA-SEP H.B. 2845 77(R)BILL ANALYSIS Office of House Bill AnalysisH.B. 2845 By: Danburg Energy Resources 7/17/2001 Enrolled BACKGROUND AND PURPOSE Increased population in urban areas combined with a growing high tech industry has increased the need for reliable electrical power which in the past has been met through the construction of large central station power plants. However, transmission constraints in some areas could lead to periodic shortages during peak demand times. To ease the peak time strain on the electrical grid, the Public Utility Commission of Texas has encouraged the development of small scale distributed generation technologies. These technologies such as natural gas and diesel fuel emit significantly more emissions per-kilowatt-hour than large central station power plants which can contribute to an increase in air pollution. Low emission fuel cell technologies are or are near commercial availability, though at current rates these units may not be available in significant numbers at competitive prices for another five years. Certain incentives might encourage the use of fuel cells and accelerate the pace of deployment. House Bill 2845 requires the State Energy Conservation Office to develop a statewide plan for the coordinated acceleration of the commercialization of fuel cell generation in this state. RULEMAKING AUTHORITY It is the opinion of the Office of House Bill Analysis that this bill does not expressly delegate any additional rulemaking authority to a state officer, department, agency or institution. ANALYSIS House Bill 2845 amends law to require the State Energy Conservation Office (energy office) to develop a statewide plan for the coordinated acceleration of the commercialization of fuel cell generation in this state. The plan must explore and draw conclusions about the availability and efficacy of alternative mechanisms that might be created in cooperation with the private sector, utilities, and other agencies to accelerate the commercial availability and economic viability of fuel cells for use in this state. The bill sets forth minimum considerations for the plan. In developing the plan and proposed rules, guidelines, and operating procedures, the energy office is required to seek the assistance and support of the Texas Natural Resource Conservation Commission, the Public Utility Commission of Texas, and other state or local agencies. The plan must consider the impact of the use of fuel cell technologies in areas of the state that the energy office determines are nonattainment areas or have a high probability of being so designated. Not later than September 15, 2002, the energy office is required to issue to the House Energy Resources Committee and the Senate Business and Commerce Committee a report of its findings and recommendations for the development of the fuel cell commercialization initiative. The energy office is required to appoint a fuel cell initiative advisory committee to advise the energy office regarding development of the plan and to assist the energy office in meeting the goals of this Act. The energy office is required to appoint to the advisory committee representatives of the fuel cell industry, energy services providers, electric transmission and distribution utilities, retail providers of electric energy, small electric energy consumers, electric cooperatives, and municipally owned electric utilities. EFFECTIVE DATE September 1, 2001.