1-1     By:  Carter (Senate Sponsor - Fraser)                 H.B. No. 2278
 1-2           (In the Senate - Received from the House April 23, 2001;
 1-3     April 24, 2001, read first time and referred to Committee on State
 1-4     Affairs; May 9, 2001, reported favorably by the following vote:
 1-5     Yeas 8, Nays 0; May 9, 2001, sent to printer.)
 1-6                            A BILL TO BE ENTITLED
 1-7                                   AN ACT
 1-8     relating to the consolidation and functions of the energy
 1-9     management center and the state energy conservation office and to
1-10     the transfer of the powers and duties of the center and the office
1-11     to the comptroller's office.
1-12           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-13           SECTION 1. Chapter 447, Government Code, is amended to read
1-14     as follows:
1-15                CHAPTER 447. STATE ENERGY CONSERVATION OFFICE
1-16                         [ENERGY MANAGEMENT CENTER]
1-17           Sec. 447.001.  ESTABLISHMENT OF OFFICE [CENTER]. (a)  The
1-18     state energy conservation office [management center] is established
1-19     in the comptroller's office [General Services Commission] and shall
1-20     be authorized to promote those policies of the state enumerated in
1-21     this chapter.
1-22           (b)  The state energy conservation office performs the
1-23     functions prescribed for the office by Chapter 2305.
1-24           Sec. 447.0011.  REFERENCE IN LAW. A reference in law to the
1-25     energy management center means the state energy conservation
1-26     office.
1-27           Sec. 447.002.  INFORMATION; RULES; PROGRAMS. The state energy
1-28     conservation office [management center] shall develop and provide
1-29     energy conservation information for the state. The office [center]
1-30     may make rules relating to the adoption and implementation of
1-31     energy conservation programs applicable to state buildings and
1-32     facilities.  The office [center] may act in such other capacities
1-33     as otherwise authorized by state or federal law.  The office's
1-34     [center's] rules for programs and energy conservation, adopted
1-35     under Chapter 2001, may include provisions relating to the
1-36     retrofitting of existing state structures with energy-saving
1-37     devices and to the energy-related renovation of such structures.
1-38     To the extent that the office [of the governor] receives money
1-39     appropriated for energy efficiency programs, the office [of the
1-40     governor, through the energy management center,] shall implement
1-41     programs that it [the center] identifies as encouraging energy
1-42     conservation by state government.  The office shall adopt rules
1-43     requiring [Unless money is available for the implementation of such
1-44     a program,] a state agency to implement [is not required to spend
1-45     money for] an energy conservation measure or program in accordance
1-46     with the plans developed under Section 447.010 if:
1-47                 (1)  the measure or program meets the eligibility
1-48     requirements of Section 2166.406; and
1-49                 (2)  funding is available, including funding from a
1-50     financing method prescribed by Section 2166.406 [under this
1-51     section].
1-52           Sec. 447.003.  LIAISON TO FEDERAL GOVERNMENT. The state
1-53     energy conservation office [management center] shall serve as the
1-54     state liaison to the federal government for the implementation and
1-55     administration of federal programs relating to state agency energy
1-56     matters.  In that capacity, the office [center] shall administer
1-57     state programs established under:
1-58                 (1)  Part D, Title III, Energy Policy and Conservation
1-59     Act (42 U.S.C. 6321 et seq.);
1-60                 (2)  Part G, Title III, Energy Policy and Conservation
1-61     Act (42 U.S.C. 6371 et seq.);
1-62                 (3)  the National Energy Extension Service Act (42
1-63     U.S.C. 7001 et seq.); and
1-64                 (4)  other federal energy conservation programs as may
 2-1     be assigned to the office [energy management center] by the
 2-2     governor or legislature.
 2-3           Sec. 447.004.  DESIGN STANDARDS. (a)  The state energy
 2-4     conservation office [management center] shall adopt and publish
 2-5     energy conservation design standards, under Chapter 2001, that all
 2-6     new state buildings and major renovation projects, including
 2-7     buildings and major renovation projects of state-supported
 2-8     institutions of higher education, are required to meet.  The office
 2-9     [center] shall define what constitutes a major renovation project
2-10     under this section and shall review and update the standards
2-11     biennially.
2-12           (b)  The standards must include performance and procedural
2-13     standards for the maximum energy conservation allowed by the latest
2-14     and most cost-effective technology that is consistent with the
2-15     requirements of public health, safety, and economic resources.
2-16           (c)  The standards must be adopted in terms of energy
2-17     consumption levels and must take into consideration the various
2-18     classes of building uses and must allow for design flexibility.
2-19     Procedural standards must be directed toward specific design and
2-20     building practices that produce good thermal resistance and low
2-21     infiltration and toward requiring practices in the design of
2-22     mechanical and electrical systems that maximize energy efficiency.
2-23     The procedural standards must concern, as applicable:
2-24                 (1)  insulation;
2-25                 (2)  lighting;
2-26                 (3)  ventilation;
2-27                 (4)  climate control;
2-28                 (5)  special energy requirements of health-related
2-29     facilities of higher education and state agencies; and
2-30                 (6)  any other item that the office [center] considers
2-31     appropriate that is adopted under Chapter 2001.
2-32           (d)  In order to demonstrate compliance with the requirement
2-33     to adopt and update the conservation design standards, each agency
2-34     and institution of higher education shall submit a copy of its
2-35     design and construction manuals to the office [center] on request.
2-36           (e)  Prior to construction, agencies and institutions of
2-37     higher education shall have the design architect or engineer on the
2-38     project certify to the agency or institution, with a copy to the
2-39     office [energy management center], that all new building
2-40     construction and major building renovation projects comply with the
2-41     energy conservation design standards required under this section.
2-42           Sec. 447.005.  ENERGY EFFICIENCY PROJECTS. Subject to
2-43     applicable state and federal laws or guidelines, the state energy
2-44     conservation office [management center] may implement energy
2-45     efficiency projects at state agencies or may assist those agencies
2-46     in implementing the projects through energy efficiency programs
2-47     financed through state or federal grants or loans.
2-48           Sec. 447.006.  OBTAINING AND REPORTING DATA. The state energy
2-49     conservation office [management center] shall [obtain]
2-50     semiannually:
2-51                 (1)  obtain from each state agency information relating
2-52     to the progress each agency has made in reducing energy costs
2-53     through adherence to the plans developed under Section 447.010; and
2-54                 (2)  report the information obtained in Subdivision (1)
2-55     to the Legislative Budget Board [cost of heating and cooling
2-56     buildings owned by the state].
2-57           Sec. 447.007.  MODEL CODES. The state energy conservation
2-58     office [management center] may recommend model energy conservation
2-59     building codes to municipalities for use in enacting or amending
2-60     municipal ordinances.
2-61           Sec. 447.008.  ADDITIONAL ENERGY SERVICES. (a)  The state
2-62     energy conservation office [management center] may provide
2-63     additional energy services, including:
2-64                 (1)  training of designated state employees in energy
2-65     management, energy-accounting techniques, and energy efficient
2-66     design and construction;
2-67                 (2)  technical assistance regarding energy efficient
2-68     capital improvements, energy efficient building design, and
2-69     cogeneration and thermal storage investments;
 3-1                 (3)  technical assistance to the State Auditor and to
 3-2     state agencies regarding conducting energy management performance
 3-3     audits and monitoring of utility bills to detect billing errors;
 3-4                 (4)  technical assistance to state agencies regarding
 3-5     third-party financing of energy efficient capital improvement
 3-6     projects; and
 3-7                 (5)  other energy-related assistance requested by
 3-8     agencies, other legislatively created entities of the state,
 3-9     institutions of higher education, and consortiums of institutions
3-10     of higher education that the office [center] considers appropriate.
3-11           (b)  Using available state, federal, or oil overcharge funds,
3-12     the office [energy management center] may assist state agencies and
3-13     institutions of higher education in analyzing and negotiating rates
3-14     for electricity and natural gas supplies from locally certificated
3-15     electric suppliers, natural gas suppliers, or state-owned energy
3-16     resources, including transportation charges for natural gas.  The
3-17     provisions of this section shall not be construed to empower the
3-18     office [energy management center] to negotiate rates for natural
3-19     gas supplies on behalf of state agencies or institutions but rather
3-20     to provide technical assistance as needed.
3-21           (c)  Agencies and institutions of higher education may seek
3-22     the assistance of the office [energy management center] before
3-23     negotiating or contracting for the supply and transportation of
3-24     natural gas and electricity that will result in an anticipated
3-25     annual expenditure of more than $100,000.
3-26           (d)  Any state agency or institution of higher education with
3-27     expertise in rate analysis, negotiation, or any other matter
3-28     related to the procurement of electricity and natural gas supplies
3-29     from locally certificated electric suppliers, natural gas
3-30     suppliers, or state-owned energy resources may assist the office
3-31     [energy management center] whenever practicable.  The attorney
3-32     general on request shall assist the office [energy management
3-33     center] and other state agencies and institutions of higher
3-34     education in negotiating rates for electricity and other terms of
3-35     electric utility service.
3-36           (e)  Using available funds from any source where permitted,
3-37     the office [energy management center] may assist state agencies,
3-38     legislatively created entities of the state, institutions of higher
3-39     education, and consortiums of institutions of higher education to
3-40     further the goals and pursue the policies of the state in energy
3-41     research as may be determined by the governor or the legislature.
3-42     The office [energy management center] may assist state agencies,
3-43     which are hereby authorized to act in accordance with this section,
3-44     in implementing federal energy policy as expressed in Pub. L. No.
3-45     102-486, 106 Stat. 2776 (1992).
3-46           (f)  The office [energy management center] on request may
3-47     negotiate rates for electricity and other terms of electric utility
3-48     service for a state agency or institution of higher education.  The
3-49     office [energy management center] may also negotiate the rates and
3-50     the other terms of service for a group of agencies and institutions
3-51     together in a single contract.
3-52           (g)  The office [energy management center] shall analyze the
3-53     rates for electricity charged to and the amount of electricity used
3-54     by state agencies and institutions of higher education to determine
3-55     ways the state could obtain lower rates and use less electricity.
3-56     State agencies, including the Public Utility Commission of Texas,
3-57     and institutions of higher education shall assist the office
3-58     [energy management center] in obtaining the information the office
3-59     [center] requires to perform its analysis.
3-60           (h)  The office [energy management center] and the attorney
3-61     general shall cooperate in monitoring efforts to deregulate the
3-62     electric utility industry and in reporting on the ways in which
3-63     deregulation would affect state government as a purchaser of
3-64     electricity.  The office [energy management center], represented by
3-65     the attorney general, may intervene in proceedings before the
3-66     Public Utility Commission of Texas that are related to deregulating
3-67     all or part of the electric utility industry to represent the
3-68     interests of state government as a purchaser of electricity in
3-69     those proceedings.
 4-1           Sec. 447.009.  ENERGY AUDITS. (a)  The state energy
 4-2     conservation office [management center] shall conduct audits of
 4-3     state-owned buildings used by state agencies.  The audits shall be
 4-4     designed to assist state agencies in reducing energy consumption
 4-5     and costs through improved energy efficiency.
 4-6           (b)  Based on the audit performed under Subsection (a) of
 4-7     this section, the state energy conservation office [of the
 4-8     governor] may recommend changes to improve energy efficiency.
 4-9           (c)  The state energy conservation office [management center]
4-10     may provide training, technical assistance, and funding, if
4-11     available, to the State Auditor's office or the office charged with
4-12     performing management audits of state agencies to conduct energy
4-13     management audits in state agencies and institutions of higher
4-14     education.
4-15           (d)  State agencies and institutions of higher education
4-16     shall conduct reviews and audits of utility billings and contracts
4-17     to detect billing errors.  Contracts with private sector firms must
4-18     comply with all applicable provisions of Chapter 654 regarding
4-19     professional services contracts and may not be awarded on a
4-20     contingent fee basis unless a finding that the contract is
4-21     necessary, reasonable, and prudent is obtained from the office of
4-22     the governor.
4-23           Sec. 447.010.  [ENERGY-SAVING DEVICES OR MEASURES. (a)  On
4-24     approval by the energy -management center, a state agency that
4-25     reduces its energy expenses may use any funds saved by the agency
4-26     from appropriated utility funds for the purchase of energy-saving
4-27     devices or measures.  For purposes of this section, "energy-saving
4-28     device or measure" means a device or measure that directly reduces
4-29     energy costs or the consumption of a lighting, heating,
4-30     ventilating, or air conditioning system or of other equipment that
4-31     uses electricity, natural gas, fuel oil, or any other energy source
4-32     without materially altering the quality of such lighting, heating,
4-33     ventilating, air conditioning, or other energy consuming system.]
4-34           [(b)  A state agency, in accordance with the recommendations
4-35     of an energy audit, may purchase energy-saving devices or measures
4-36     from appropriated utility funds if the savings in utility funds
4-37     projected by the audit will offset the purchase within four years.
4-38     A copy of the recommendation and repayment schedule must be
4-39     attached to the purchase voucher as evidence of the projected
4-40     savings.]
4-41           [Sec. 447.011.]  ENERGY MANAGEMENT PLANNING. (a)  The state
4-42     energy conservation office [management center] shall provide energy
4-43     management planning assistance to state agencies and institutions
4-44     of higher education, including:
4-45                 (1)  preparation of a long-range plan for the delivery
4-46     of reliable, cost-effective utility services for state agencies,
4-47     institutions of higher education, boards, and commissions in Travis
4-48     County.  This plan shall be presented to the affected agencies for
4-49     use in preparing their five-year construction and major
4-50     rehabilitation plans.  After other energy-saving alternatives are
4-51     considered, district heating and cooling and on-site generation of
4-52     electricity may be considered in planning for reliable, efficient,
4-53     and cost-effective utility services;
4-54                 (2)  assistance to the Department of Public Safety for
4-55     energy emergency contingency planning, using state or federal funds
4-56     when available; [and]
4-57                 (3)  assistance to state agencies and institutions of
4-58     higher education in preparing comprehensive energy management
4-59     plans.  The office [energy management center] shall prepare
4-60     guidelines for the preparation of these plans.  State agencies and
4-61     institutions of higher education that expend more than $250,000
4-62     annually for heating, lighting, and cooling and that occupy
4-63     state-owned buildings shall prepare and submit a five-year energy
4-64     management plan to the office [center].  Agencies and institutions
4-65     of higher education with smaller usage may be required to submit
4-66     such plans.  Updated plans shall be submitted biennially when
4-67     requested by the office; and
4-68                 (4)  assistance to state agencies other than
4-69     institutions of higher education in meeting the requirements of
 5-1     Section 447.002, including assistance in scheduling and assigning
 5-2     priorities to implementation plans to ensure that state agencies
 5-3     adopt qualified cost-effective efficiency measures and programs for
 5-4     all state facilities by September 1, 2006 [center].
 5-5           (b)  The energy management plan required in Subsection (a)(3)
 5-6     shall be included in the five-year construction and major
 5-7     rehabilitation plans for institutions of higher education as
 5-8     required under Section 61.058 and 61.0651, Education Code.
 5-9           SECTION 2. Section 2305.002(3), Government Code, is amended
5-10     to read as follows:
5-11                 (3)  "Energy office" means the state energy
5-12     conservation office of the comptroller's office as established by
5-13     Chapter 447 [General Services Commission].
5-14           SECTION 3. The heading to Section 2305.011, Government Code,
5-15     is amended to read as follows:
5-16           Sec. 2305.011.  ADMINISTRATION BY COMPTROLLER'S OFFICE
5-17     [GENERAL SERVICES COMMISSION] AND ENERGY OFFICE.
5-18           SECTION 4.  Section 2305.011, Government Code, is amended by
5-19     adding Subsection (f) to read as follows:
5-20           (f)  The comptroller may adopt rules as necessary to
5-21     administer the programs prescribed by this chapter.
5-22           SECTION 5. Section 2305.022, Government Code, is amended to
5-23     read as follows:
5-24           Sec. 2305.022.  USE OF ACCOUNT. Money in the account may be
5-25     used only by the governor and the comptroller's office [General
5-26     Services Commission] to implement and operate the programs
5-27     authorized by this chapter.
5-28           SECTION 6. On September 1, 2001:
5-29                 (1)  the energy management center established under
5-30     Chapter 447, Government Code, as it existed on the effective date
5-31     of this Act, and the state energy conservation office established
5-32     under Chapter 2305, Government Code, are consolidated;
5-33                 (2)  all functions and activities performed by the
5-34     General Services Commission that relate to energy conservation
5-35     under Chapter 447 or 2305, Government Code, immediately before that
5-36     date are transferred to the comptroller's office;
5-37                 (3)  all employees of the General Services Commission
5-38     who primarily perform duties related to energy conservation under
5-39     Chapter 447 or 2305, Government Code, become employees of the
5-40     comptroller's office;
5-41                 (4)  a rule, standard, or form adopted by the General
5-42     Services Commission that relates to energy conservation under
5-43     Chapter 447 or 2305, Government Code, is a rule or form of the
5-44     comptroller's office and remains in effect until altered by the
5-45     office;
5-46                 (5)  a reference in law to the  General Services
5-47     Commission that relates to energy conservation under Chapter 447 or
5-48     2305, Government Code, means the comptroller's office;
5-49                 (6)  a proceeding involving the General Services
5-50     Commission that is related to energy conservation under Chapter 447
5-51     or 2305, Government Code, is transferred without change in status
5-52     to the comptroller's office, and the comptroller's office assumes
5-53     without a change in status the position of the General Services
5-54     Commission in a proceeding relating to energy conservation to which
5-55     the General Services Commission is a party;
5-56                 (7)  all money, contracts, leases, rights, and
5-57     obligations of the General Services Commission related to energy
5-58     conservation under Chapter 447 or 2305, Government Code, are
5-59     transferred to the comptroller's office;
5-60                 (8)  all property, including records, in the custody of
5-61     the General Services Commission related to energy conservation
5-62     under Chapter 447 or 2305, Government Code, becomes property of the
5-63     comptroller's office; and
5-64                 (9)  all funds appropriated by the legislature to the
5-65     General Services Commission for purposes related to energy
5-66     conservation under Chapter 447 or 2305, Government Code, are
5-67     transferred to the comptroller's office.
5-68           SECTION 7. This Act takes effect September 1, 2001.
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