| TO: | Honorable Phil King, Chair, House Committee on Regulated Industries |
| FROM: | John Keel, Director, Legislative Budget Board |
| IN RE: | HB2666 by Puente (Relating to demonstration and deployment of fuel cells for electric generation.), As Introduced |
| Fiscal Year | Probable Net Positive/(Negative) Impact to General Revenue Related Funds |
|---|---|
| 2004 | ($81,600) |
| 2005 | ($81,600) |
| 2006 | ($81,600) |
| 2007 | ($81,600) |
| 2008 | ($81,600) |
| Fiscal Year | Probable (Cost) fromGENERAL REVENUE FUND 1 |
Change in Number of State Employees from FY 2003 |
|---|---|---|
| 2004 | ($81,600) | 1.0 |
| 2005 | ($81,600) | 1.0 |
| 2006 | ($81,600) | 1.0 |
| 2007 | ($81,600) | 1.0 |
| 2008 | ($81,600) | 1.0 |
The bill would create a fuel cell demonstration and deployment program to achieve specific goals for installing electric generation capacity from fuel cells in non-attainment areas or affected counties. The bill would only apply to an electric utility (including a transmission and distribution utility in areas with customer choice), municipally owned utility, and electric cooperative that is located in or that serves an area that is in a non-attainment area or an area that is an affected county, as defined in the Health and Safety Code § 386.001(2). These entities would be required to establish a program to ensure that a certain total of megawatts of fuel cell electric generation capacity be installed by January 1, 2011.
To meet the goal, a utility would be required to provide incentives to customers through standard-offer programs to purchase and own fuel cells. Integrated investor-owned utilities, municipally owned utilities, and cooperatives would have the flexibility to provide incentives or own fuel cells to meet the goal.
The bill would require the Public Utility Commission (PUC) to establish rules to set goals for each applicable electric utility, municipally owned utility and electric cooperative that is proportional to its share of electric generation load. However, the bill would allow the PUC to exempt “small electric cooperatives or municipally owned utilities” from participation in this mandate. The PUC would also be required to establish by rule the incentive levels that are necessary and sufficient for different fuel cell sizes to meet the generation capacity goals by the appropriate dates.
The bill would require the Texas Council on Environmental Technology (TCET) to provide coordination and support for the Texas Consortium for Advanced Fuel Cell Research (TCAFCR) and to monitor and evaluate the status of the fuel cell industry in the state for both mobile and stationary applications. It would also require the council to develop legislative recommendations for instituting other means of accelerating the commercial availability of stationary fuel cell electric generating capacity, instituting means of fostering the development or manufacturing of fuel cells, and instituting appropriate means to prepare the state to accept the early introduction of fuel cell vehicles or other ultra-low-emissions vehicles.
The bill would also require the State Energy Conservation Office (SECO) to partner with the U.S. Department of Energy and other federal agencies or programs to develop cooperative programs related to research on, development of, and demonstration of fuel cell technology in the state.
Additional administrative costs resulting from the bill's requirements relating to the PUC and the SECO (within the Office of the Comptroller of Public Accounts) are expected to be absorbed within existing agency resources.
It is estimated that passage of the bill would result in increased administrative costs to the TCET totaling $81,600 per year. Additionally, it is expected that the TCEQ would require one additional FTE to carry out duties as prescribed in the bill. These costs would be associated with the agency monitoring and evaluating the status of the fuel cell industry and market conditions affecting the introduction of fuel cells to the market, as well as the development of a report to be presented to the Legislature and the provision of support to the TCAFCR.
| Source Agencies: | 304 Comptroller of Public Accounts, 369 Council on Environmental Technology, 473 Public Utility Commission of Texas, 475 Office of Public Utility Counsel
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| LBB Staff: | JK, JRO, MS, TL, KG
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