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A BILL TO BE ENTITLED
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AN ACT
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relating to the Texas Global Warming Solutions Act; imposing a fee |
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and providing a penalty. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Subtitle C, Title 5, Health and Safety Code, is |
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amended by adding Chapter 391 to read as follows: |
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CHAPTER 391. TEXAS GLOBAL WARMING SOLUTIONS ACT |
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SUBCHAPTER A. GENERAL PROVISIONS |
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Sec. 391.001. SHORT TITLE. This chapter may be cited as the |
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Texas Global Warming Solutions Act. |
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Sec. 391.002. DEFINITIONS. In this chapter: |
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(1) "Allowance" means an authorization to emit, during |
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a specified year, up to one ton of carbon dioxide equivalent. |
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(2) "Alternative compliance mechanism" means an |
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action undertaken by a greenhouse gas emission source that achieves |
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the equivalent reduction of greenhouse gas emissions over the same |
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period as a direct emission reduction and that is approved by the |
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commission. The term includes a flexible compliance schedule, |
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alternative control technology, process change, or product |
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substitution. |
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(3) "Carbon dioxide equivalent" means the amount of |
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carbon dioxide by weight that would produce the same global warming |
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effect as a given weight of another greenhouse gas, based on the |
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best available science, including that available from the |
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Intergovernmental Panel on Climate Change. |
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(4) "Commission" means the Texas Commission on |
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Environmental Quality. |
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(5) "Cost-effective" means economical, in terms of |
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cost per unit of reduced emissions of greenhouse gases relative to |
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the global warming potential of those emissions. |
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(6) "Direct emission reduction" means a greenhouse gas |
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emission reduction made by an action taken by a greenhouse gas |
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emission source at that source. |
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(7) "Electric utility" has the meaning assigned by |
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Section 31.002, Utilities Code. |
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(8) "Emissions reduction measure" means a program, |
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measure, standard, or alternative compliance mechanism applicable |
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to a source that is designed to reduce emissions of greenhouse gases |
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and that is authorized under this chapter. |
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(9) "Greenhouse gas" includes carbon dioxide, |
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methane, nitrous oxide, hydrofluorocarbons, perfluorocarbons, and |
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sulfur hexafluoride. |
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(10) "Greenhouse gas emissions limit" means an |
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authorization during a specified year to emit greenhouse gases |
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specified by the commission not to exceed a specified amount, |
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expressed in tons of carbon dioxide equivalents. |
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(11) "Greenhouse gas emission source" or "source" |
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means any source or category of sources of greenhouse gas emissions |
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whose emissions are at such a level of significance, as determined |
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by the commission, that participation of the source or category of |
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sources in the program established under this chapter will enable |
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the commission to effectively reduce greenhouse gas emissions and |
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monitor compliance with the statewide greenhouse gas emissions |
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limit. |
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(12) "Market-based compliance mechanism" means |
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either: |
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(A) a system of market-based declining annual |
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aggregate emissions limitations for sources that emit greenhouse |
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gases; or |
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(B) greenhouse gas emissions exchanges, banking, |
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credits, and other transactions, governed by rules and protocols |
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established by the commission, that result in the same greenhouse |
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gas emission reduction over the same period as direct compliance |
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with a greenhouse gas emissions limit or emissions reduction |
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measure adopted by the commission under this chapter. |
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(13) "Municipally owned utility" has the meaning |
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assigned by Section 11.003, Utilities Code. |
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(14) "Retail electric provider" has the meaning |
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assigned by Section 31.002, Utilities Code. |
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(15) "Statewide greenhouse gas emissions" means the |
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total annual emissions of greenhouse gases in this state, expressed |
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in tons of carbon dioxide equivalents, including all emissions of |
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greenhouse gases from the generation of electricity delivered to |
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and consumed in this state, accounting for transmission and |
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distribution line losses, whether the electricity is generated in |
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this state or imported. |
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(16) "Statewide greenhouse gas emissions limit" or |
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"statewide emissions limit" means the maximum allowable level of |
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statewide greenhouse gas emissions in 2023, as determined by the |
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commission under Subchapter C. |
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Sec. 391.003. ROLE OF COMMISSION. The commission shall |
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monitor and regulate greenhouse gas emission sources that cause |
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global warming in order to reduce those emissions. |
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Sec. 391.004. ROLE OF OTHER STATE AGENCIES. Each state |
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agency shall consider and implement strategies to reduce greenhouse |
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gas emissions generated by the agency. |
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Sec. 391.005. AUTHORITY OF PUBLIC UTILITY COMMISSION; |
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OBLIGATION OF ELECTRIC UTILITIES. This chapter does not affect: |
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(1) the authority of the Public Utility Commission of |
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Texas; or |
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(2) the obligation of an electric utility to provide |
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customers with safe and reliable electric service. |
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Sec. 391.006. CONSTRUCTION OF CHAPTER. This chapter does |
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not: |
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(1) relieve a person from complying with other |
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applicable federal, state, or local laws or regulations, including |
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state air and water quality requirements and other requirements |
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designed to protect public health or the environment; |
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(2) preclude, prohibit, or restrict the construction |
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of a new facility, as defined by Section 382.003, or the expansion |
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of an existing facility subject to regulation under this chapter if |
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the facility: |
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(A) meets all applicable requirements; and |
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(B) is in compliance with rules adopted under |
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this chapter; |
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(3) limit the existing authority of a state entity to |
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adopt and implement greenhouse gas emissions reduction measures; or |
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(4) relieve any state entity of its legal obligation |
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to comply with an existing law, rule, or regulation. |
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Sec. 391.007. EFFECT OF CHAPTER ON OTHER PROGRAMS. This |
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chapter does not confer authority on the commission to alter |
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programs administered by other state agencies for the reduction of |
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greenhouse gas emissions. |
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Sec. 391.008. ADJUSTMENT OF DEADLINES. (a) In the event of |
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extraordinary circumstances, a catastrophic event, or the threat of |
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significant economic harm, the governor may adjust a deadline |
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established under this chapter to the earliest feasible date after |
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that deadline. |
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(b) The deadline adjustment period may not exceed one year |
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unless the governor makes an additional deadline adjustment under |
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Subsection (a). |
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(c) Not later than the 10th day after the date the governor |
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invokes a deadline adjustment under Subsection (a), the governor |
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shall provide written notification to each member of the |
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legislature of the adjustment. |
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(d) This section does not affect the powers and duties |
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established under Chapter 418, Government Code. |
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Sec. 391.009. CONSULTATION WITH OTHER GOVERNMENTAL |
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ENTITIES. In developing its plans to reduce greenhouse gas |
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emissions under this chapter, the commission shall consult with |
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other states, the federal government, and other nations to identify |
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the most effective strategies and methods for reducing greenhouse |
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gases, managing greenhouse gas control programs, and facilitating |
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the development of integrated and cost-effective regional, |
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national, and international greenhouse gas reduction programs. |
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Sec. 391.010. ALTERNATIVE RULES TO CONTROL CERTAIN |
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GREENHOUSE GAS EMISSIONS. If Chapter 386 is repealed or expires, |
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the commission by rule shall implement alternative rules for |
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controlling mobile sources of greenhouse gas emissions in order to |
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achieve equivalent or greater reductions compared to those achieved |
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under that chapter. |
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[Sections 391.011-391.050 reserved for expansion] |
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SUBCHAPTER B. GREENHOUSE GAS EMISSIONS REPORTING |
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Sec. 391.051. RULES FOR REPORTING AND VERIFICATION OF |
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GREENHOUSE GAS EMISSIONS. (a) Not later than January 1, 2011, the |
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commission by rule shall: |
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(1) require the reporting and verification of |
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statewide greenhouse gas emissions; and |
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(2) begin to monitor and enforce compliance with this |
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section. |
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(b) The commission shall adopt rules that: |
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(1) beginning with the greenhouse gas emission sources |
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that contribute the most to statewide emissions, require the owner |
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or operator of a greenhouse gas emission source to monitor and |
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annually report greenhouse gas emissions; |
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(2) account for greenhouse gas emissions from all |
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electricity consumed in the state, including: |
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(A) electricity consumed by transmission and |
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distribution line losses of electricity generated inside the state |
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or generated outside the state; and |
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(B) electricity generated by retail sellers of |
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electricity, including retail electric providers and municipally |
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owned utilities; |
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(3) ensure rigorous and consistent accounting of |
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emissions and provide reporting tools and formats to ensure |
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collection of necessary data; |
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(4) ensure that the owners or operators of greenhouse |
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gas emission sources maintain comprehensive records of all reported |
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greenhouse gas emissions; and |
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(5) include notification of any person subject to |
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rules under this section. |
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Sec. 391.052. REVIEW AND UPDATE OF REPORTING REQUIREMENTS. |
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The commission shall: |
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(1) as necessary, periodically review and update the |
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emissions reporting requirements described by this subchapter; |
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(2) review existing and proposed international, |
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federal, and state greenhouse gas emissions reporting programs and |
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make reasonable efforts to promote consistency among the programs |
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established under this subchapter and other programs; and |
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(3) streamline reporting requirements on greenhouse |
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gas emission sources. |
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[Sections 391.053-391.100 reserved for expansion] |
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SUBCHAPTER C. STATEWIDE GREENHOUSE GAS EMISSIONS LIMIT |
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Sec. 391.101. PROCEDURE FOR ESTABLISHING GREENHOUSE GAS |
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EMISSIONS LIMIT. (a) Not later than January 1, 2011, the |
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commission shall determine the amount of greenhouse gas emissions |
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in this state in 1990 and approve a statewide greenhouse gas |
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emissions limit that is equivalent to that amount. The limit must |
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be achieved by 2023. |
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(b) The commission shall hold at least one public workshop |
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and provide an opportunity for all interested parties to comment on |
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the determinations made by the commission under Subsection (a). |
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The commission shall approve the statewide greenhouse gas emissions |
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limit at a public hearing. The commission shall provide public |
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notice of the public workshop and hearing. |
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(c) To ensure the most accurate determinations feasible |
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under Subsection (a), the commission shall evaluate the best |
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available scientific, technological, and economic information on |
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greenhouse gas emissions to determine the 1990 amount of greenhouse |
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gas emissions. |
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Sec. 391.102. USE OF STATEWIDE LIMIT. The commission shall |
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use the statewide greenhouse gas emissions limit to maintain and |
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continue reductions in emissions of greenhouse gases after 2023. |
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Sec. 391.103. RECOMMENDATIONS. The commission shall |
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periodically make recommendations to the governor and the |
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legislature on how to continue reducing greenhouse gas emissions |
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after 2023. |
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[Sections 391.104-391.150 reserved for expansion] |
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SUBCHAPTER D. GREENHOUSE GAS EMISSIONS REDUCTIONS |
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Sec. 391.151. MAXIMUM GREENHOUSE GAS EMISSIONS REDUCTIONS. |
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Subject to the criteria and schedules established under this |
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subchapter, the commission in an open public process shall adopt |
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rules that facilitate achieving the maximum technologically |
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feasible and cost-effective reductions in greenhouse gas emissions |
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from sources. |
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Sec. 391.152. EARLY ACTIONS TO REDUCE GREENHOUSE GAS |
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EMISSIONS. (a) Not later than June 30, 2010, the commission shall |
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publish and make available to the public a list of early actions |
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that can be implemented to reduce greenhouse gas emissions before |
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the measures and limits adopted under Section 391.154 are |
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implemented. |
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(b) Before January 1, 2013, the commission shall adopt rules |
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to implement the actions identified on the list under Subsection |
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(a). |
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(c) The rules adopted by the commission under this section |
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must make it possible to achieve the maximum technologically |
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feasible and cost-effective reductions in greenhouse gas emissions |
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from sources in furtherance of achieving the statewide greenhouse |
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gas emissions limit established under Section 391.101. |
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(d) Not later than January 1, 2013, the commission shall |
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begin enforcing the rules adopted under this section. |
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Sec. 391.153. COMPREHENSIVE PLAN. (a) Not later than |
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January 1, 2012, the commission shall prepare and approve a |
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comprehensive plan for achieving the maximum technologically |
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feasible and cost-effective reductions in greenhouse gas emissions |
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from sources by 2023. |
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(b) The commission shall consult with each state agency |
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having jurisdiction over sources, including the Public Utility |
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Commission of Texas, on all elements of the comprehensive plan that |
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pertain to energy-related matters, including electrical |
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generation, alternative pollution standards or requirements, the |
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provision of reliable and affordable electrical service, petroleum |
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refining, and statewide fuel supplies, to ensure that the |
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greenhouse gas emissions reduction activities to be adopted and |
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implemented by the commission are complementary, nonduplicative, |
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and capable of being implemented in an efficient and cost-effective |
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manner. |
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(c) The comprehensive plan must identify and make |
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recommendations on direct emission reduction measures, alternative |
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compliance mechanisms, market-based compliance mechanisms, and |
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potential monetary and nonmonetary incentives for sources that the |
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commission finds are necessary or desirable to facilitate the |
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achievement of the maximum feasible and cost-effective reductions |
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of greenhouse gas emissions by 2023. |
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(d) In making the determinations required by Subsection |
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(c), the commission shall consider all relevant information |
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pertaining to greenhouse gas emissions reduction programs in other |
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states, localities, and nations, including the northeastern states |
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of the United States, Canada, and the European Union. |
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(e) The commission shall evaluate the total potential costs |
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and total potential economic and noneconomic benefits of the |
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comprehensive plan for reducing greenhouse gases to this state's |
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economy, environment, and public health, using the best available |
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economic models, emission estimation techniques, and other |
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scientific methods. |
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(f) In developing the comprehensive plan, the commission |
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shall: |
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(1) take into account the relative contribution of |
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each source or source category to statewide greenhouse gas |
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emissions and the potential for adverse effects on small |
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businesses; |
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(2) recommend a de minimis threshold of greenhouse gas |
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emissions below which emissions reduction requirements will not |
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apply; and |
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(3) identify opportunities for emissions reduction |
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measures from all verifiable and enforceable voluntary actions, |
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including carbon sequestration projects that capture and store or |
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reuse carbon from emissions and best management practices. |
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(g) The commission shall conduct a series of public |
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workshops to give interested parties an opportunity to comment on |
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the comprehensive plan. The commission shall conduct some of the |
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workshops in regions of the state that have the most significant |
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exposure to air pollutants, including communities with large |
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minority and low-income populations. |
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(h) At least once every five years, the commission shall |
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update the comprehensive plan in order to achieve the maximum |
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technologically feasible and cost-effective reductions of |
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greenhouse gas emissions. |
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Sec. 391.154. SOURCE GREENHOUSE GAS EMISSIONS LIMITS AND |
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EMISSIONS REDUCTION MEASURES. (a) Not later than January 1, 2014, |
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the commission by rule shall adopt greenhouse gas emissions limits |
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and emissions reduction measures for sources or categories of |
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sources to achieve the maximum technologically feasible and |
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cost-effective reductions in greenhouse gas emissions in |
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furtherance of achieving the statewide greenhouse gas emissions |
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limit established under Section 391.101. |
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(b) To the extent feasible, in adopting rules under this |
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section and Subchapter E, the commission shall: |
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(1) design the rules, including rules concerning the |
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distribution of emissions allowances where appropriate, in a manner |
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that is equitable, seeks to minimize costs and maximize the total |
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benefits to this state, and encourages early action to reduce |
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greenhouse gas emissions; |
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(2) ensure that activities undertaken to comply with |
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the rules do not disproportionately impact low-income communities |
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in a negative manner; |
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(3) ensure that an entity that has voluntarily reduced |
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its greenhouse gas emissions before the implementation of rules |
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adopted under this section receives appropriate credit for early |
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voluntary reductions; |
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(4) ensure that activities undertaken pursuant to the |
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rules complement and do not interfere with efforts to achieve and |
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maintain federal and state ambient air quality standards and to |
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reduce toxic air contaminant emissions; |
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(5) consider the cost-effectiveness of the rules; |
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(6) consider overall societal benefits, including |
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reductions in other air pollutants, diversification of energy |
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sources, and other benefits to the economy, environment, and public |
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health; |
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(7) minimize the administrative burden of |
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implementing and complying with the rules; |
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(8) minimize reductions in emissions of greenhouse |
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gases in this state that are offset by increases in emissions of |
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greenhouse gases outside this state; and |
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(9) consider the significance of the contribution of |
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each source to statewide emissions of greenhouse gases. |
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(c) The commission by rule may establish a system of |
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market-based declining annual aggregate emissions limits for |
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greenhouse gas emission sources, applicable from January 1, 2015, |
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to December 31, 2023, that the commission determines will |
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aggregately achieve the maximum technologically feasible and |
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cost-effective reductions in greenhouse gas emissions from those |
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sources. The initial adoption of rules under this subsection must |
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be completed on or before January 1, 2014. |
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(d) Any rule adopted under this subchapter or Subchapter E |
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must ensure that: |
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(1) the greenhouse gas emissions reductions achieved |
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are permanent, quantifiable, verifiable, and enforceable by the |
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commission; |
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(2) for rules adopted under Subchapter E, the |
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reduction is in addition to: |
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(A) any greenhouse gas emissions reduction |
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otherwise required by law or regulation; and |
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(B) any other greenhouse gas emissions reduction |
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that otherwise would occur; and |
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(3) if applicable, the greenhouse gas emissions |
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reduction occurs over the same period and is equivalent in amount to |
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any direct emission reduction required under this chapter. |
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(e) The commission shall rely upon the best available |
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economic and scientific information and the commission's |
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assessment of existing and projected technological capabilities |
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when adopting the rules required by this section. |
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(f) The commission shall consult with the Public Utility |
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Commission of Texas in the development of the rules as they affect |
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electricity and natural gas providers in order to minimize |
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duplicative or inconsistent regulatory requirements. |
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(g) After January 1, 2014, the commission may revise rules |
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adopted under this section and adopt additional rules to further |
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the provisions of this chapter. |
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(h) A rule adopted under this section on or before January |
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1, 2014, takes effect January 1, 2015. |
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Sec. 391.155. EARLY IMPLEMENTATION OF CHAPTER. This |
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chapter does not restrict the commission from: |
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(1) adopting greenhouse gas emissions limits or |
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emissions reduction measures for sources or categories of sources |
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before January 1, 2014; |
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(2) enforcing those limits or measures before January |
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1, 2013; or |
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(3) providing early reduction credit where |
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appropriate. |
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Sec. 391.156. PUBLIC AND PRIVATE INVESTING. To the extent |
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feasible and applicable, the commission shall ensure that the |
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greenhouse gas emissions reduction rules, programs, mechanisms, |
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and incentives under its jurisdiction: |
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(1) direct public and private investment toward the |
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most disadvantaged communities in this state; and |
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(2) provide an opportunity for small businesses, |
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schools, affordable housing associations, and other community |
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institutions to participate in and benefit from statewide efforts |
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to reduce greenhouse gas emissions. |
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[Sections 391.157-391.200 reserved for expansion] |
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SUBCHAPTER E. MARKET-BASED COMPLIANCE MECHANISMS |
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Sec. 391.201. OPTIONAL RULES FOR MARKET-BASED COMPLIANCE |
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MECHANISMS. (a) The commission may include the use of market-based |
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compliance mechanisms in the rules adopted under Section 391.154. |
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(b) Before including market-based compliance mechanisms in |
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the rules adopted under Section 391.154, to the extent feasible and |
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in furtherance of achieving the statewide greenhouse gas emissions |
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limit established under Section 391.101, the commission shall: |
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(1) consider the potential for direct, indirect, and |
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cumulative emission effects from these mechanisms, including |
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localized effects in communities that are already adversely |
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affected by air pollution; |
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(2) design any market-based compliance mechanism to |
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prevent an increase in the emissions of toxic air contaminants or |
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criteria air pollutants (ozone, carbon monoxide, particulate |
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matter, sulfur dioxide, lead, and nitrogen dioxide) for which the |
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United States Environmental Protection Agency sets standards; and |
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(3) maximize additional environmental and economic |
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benefits for this state, as appropriate. |
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(c) The commission shall adopt rules governing how |
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regulated entities subject to greenhouse gas emissions limits and |
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mandatory emissions reporting requirements may use market-based |
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compliance mechanisms to achieve compliance with greenhouse gas |
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emissions limits. |
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Sec. 391.202. ADOPTION OF METHODOLOGIES. (a) The |
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commission shall adopt: |
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(1) methodologies for the quantification of voluntary |
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greenhouse gas emissions reductions; and |
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(2) rules to verify any voluntary greenhouse gas |
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emissions reductions that are authorized by the commission for use |
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in complying with greenhouse gas emissions limits established by |
|
the commission. |
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(b) Chapter 2001, Government Code, does not apply to the |
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adoption of the methodologies described by Subsection (a). |
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[Sections 391.203-391.250 reserved for expansion] |
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SUBCHAPTER F. ENFORCEMENT |
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Sec. 391.251. MONITORING AND ENFORCEMENT. The commission |
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shall monitor compliance with and enforce any rule, order, |
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emissions limitation, emissions reduction measure, or market-based |
|
compliance mechanism adopted by the commission under this chapter. |
|
[Sections 391.252-391.300 reserved for expansion] |
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SUBCHAPTER G. GREENHOUSE GAS EMISSIONS CONTROL ACCOUNT; FEES |
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Sec. 391.301. GREENHOUSE GAS EMISSIONS CONTROL |
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ACCOUNT. (a) The greenhouse gas emissions control account is a |
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separate account in the general revenue fund. |
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(b) The account consists of: |
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(1) transfers to the account; |
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(2) interest earned on the account; |
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(3) fees collected under this subchapter; |
|
(4) penalties paid under this chapter; and |
|
(5) grants and donations accepted for the account. |
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(c) Money in the account may be used only to administer |
|
programs under this chapter. |
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(d) Any money in the account not used in a fiscal year |
|
remains in the account. The account is exempt from the application |
|
of Section 403.095, Government Code. |
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Sec. 391.302. FEES. (a) Not later than June 30, 2011, the |
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commission shall impose on the owner of a greenhouse gas emission |
|
source an annual fee. |
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(b) The commission by rule shall determine the amount of the |
|
fee, which may not exceed the source's fair share of the annual cost |
|
to implement programs under this chapter, including: |
|
(1) the cost of monitoring compliance with rules under |
|
this chapter; and |
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(2) the cost of enforcing those rules. |
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[Sections 391.303-391.350 reserved for expansion] |
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SUBCHAPTER H. ADVISORY COMMITTEES |
|
Sec. 391.351. ENVIRONMENTAL JUSTICE ADVISORY COMMITTEE. |
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(a) Not later than January 1, 2010, the commission shall convene an |
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Environmental Justice Advisory Committee to advise the commission |
|
in developing the comprehensive plan under Section 391.153 and in |
|
implementing this chapter. |
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(b) The Environmental Justice Advisory Committee must |
|
consist of at least three members who represent communities in the |
|
state with the most significant exposure to air pollution caused by |
|
the emission of greenhouse gases, including communities with large |
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minority or low-income populations. |
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(c) The commission shall appoint the Environmental Justice |
|
Advisory Committee members from nominations received from |
|
environmental justice organizations and community groups. |
|
(d) The commission shall provide a reasonable per diem for |
|
attendance at Environmental Justice Advisory Committee meetings by |
|
advisory committee members from nonprofit organizations. |
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Sec. 391.352. ECONOMIC AND TECHNOLOGICAL ADVANCEMENT |
|
ADVISORY COMMITTEE. (a) The commission shall appoint an Economic |
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and Technological Advancement Advisory Committee to advise the |
|
commission on activities that will facilitate investment in and |
|
implementation of technological research and development |
|
opportunities for the purpose of assisting in the reduction of |
|
greenhouse gas emissions, including: |
|
(1) identifying new technologies, research, |
|
demonstration projects, and funding opportunities; |
|
(2) developing state, national, and international |
|
partnerships and technology transfer opportunities; and |
|
(3) identifying and assessing research and advanced |
|
technology investment and incentive opportunities. |
|
(b) The Economic and Technological Advancement Advisory |
|
Committee may advise the commission on state, regional, national, |
|
and international economic and technological developments related |
|
to greenhouse gas emissions reductions. |
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SECTION 2. This Act takes effect September 1, 2009. |