By: Watson S.B. No. 541
  relating to incentives for Texas renewable energy jobs and
         SECTION 1.  PURPOSE.  The purpose of this Act is to continue
  promoting clean, renewable energy in Texas in a manner that creates
  manufacturing jobs and bolsters the Texas economy.
         SECTION 2.  Section 39.904, Utilities Code, is amended by
  amending Subsections (a), (b), (m-3), and (o), and adding
  Subsection (c-1) to read as follows:
         Sec. 39.904.  GOAL FOR RENEWABLE ENERGY.  (a)  It is the
  intent of the legislature that by January 1, 2015, an additional
  5,000 megawatts of generating capacity from renewable energy
  technologies will have been installed in this state.  The
  cumulative installed renewable capacity in this state shall total
  5,880 megawatts by January 1, 2015, and [the commission shall
  establish a target of] 10,000 megawatts [of installed renewable
  capacity] by January 1, 2025.  The cumulative installed renewable
  capacity in this state shall total 2,280 megawatts by January 1,
  2007, 3,272 megawatts by January 1, 2009, 4,264 megawatts by
  January 1, 2011, 5,256 megawatts by January 1, 2013, and 5,880
  megawatts by January 1, 2015.  Of the renewable energy technology
  generating capacity installed to meet the goal of this subsection,
  the cumulative installed [after September 1, 2005 the commission
  shall establish a target of having at least 500 megawatts of]
  capacity in this state from a renewable energy technology other
  than a source using wind energy shall total 3,000 megawatts by
  January 1, 2020.
         (b)  The commission shall establish [a] renewable energy
  credits trading programs to meet the goals provided by Subsection
  (a).  [program.]  Any retail electric provider, municipally owned
  utility, or electric cooperative that does not satisfy the
  requirements of Subsection (a) by directly owning or purchasing
  capacity using renewable energy technologies shall purchase
  sufficient renewable energy credits to satisfy the requirements by
  holding renewable energy credits in lieu of capacity from renewable
  energy technologies.
         (c-1)  Not later than January 1, 2011, the commission shall
  adopt rules necessary to provide a "Made in Texas" incentive for
  renewable energy credits generated by generation equipment that is
  wholly produced or substantially transformed by a Texas workforce,
  as determined by the commission.  The incentive under this
  subsection shall be available for the first three years after the
  renewable energy equipment first produces electricity on a
  commercial basis.
         (m-3)  Subsections (m), (m-1), and (m-2) do not alter the
  renewable energy goals [or targets] established in Subsection (a)
  or reduce the minimum statewide renewable energy requirements of
  Subsection (c)(1).
         (o)  The commission may establish an alternative compliance
  payment.  An entity that has a renewable energy purchase
  requirement under this section may elect to pay the alternative
  compliance payment instead of applying renewable energy credits
  toward the satisfaction of the entity's obligation under this
  section.  The commission may establish a separate alternative
  compliance payment for the goal of 3,000 [500] megawatts of
  installed capacity from renewable energy technologies other than
  wind energy by January 1, 2020.  The alternative compliance payment
  from a renewable energy purchase requirement that could be
  satisfied with a renewable energy credit from wind energy may not be
  less than $2.50 per credit or greater than $20 per credit.  Prior to
  September 1, 2009, an alternative compliance payment under this
  subsection may not be set above $5 per credit.  In implementing this
  subsection, the commission shall consider:
               (1)  the effect of renewable energy credit prices on
  retail competition;
               (2)  the effect of renewable energy credit prices on
  electric rates;
               (3)  the effect of the alternative compliance payment
  level on the renewable energy credit market; and
               (4)  any other factors necessary to ensure the
  continued development of the renewable energy industry in this
  state while protecting ratepayers from unnecessary rate increases.
         SECTION 3.  This Act takes effect September 1, 2009.