Texas Bill Would Require REPs To Meet Portfolio Standard For Zero-Carbon Resources
January 13, 2021 Email This Story Copyright 2010-21 EnergyChoiceMatters.com
Reporting by Paul Ring • firstname.lastname@example.org
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A bill, H.B. No. 685, has been filed in the Texas Senate that would establish a state goal for, "competitive zero-carbon electric generation."
The bill defines "zero-carbon energy technology" as a
technology that relies exclusively on an energy source that does not emit a greenhouse gas in the production of electricity. The term includes a technology that effectively captures and sequesters greenhouse gases before their release into the atmosphere.
The bill provides that it is the "intent" of the legislature that the amount of electric power generated in this state from zero-carbon energy technology for delivery by a retail electric provider, municipally owned utility, or electric cooperative each year will increase to
meet the following percentages on or before the specified dates:
(1) by January 1, 2025, not less than 65 percent of the
(2) by January 1, 2030, not less than 85 percent of the
annual total; and
(3) by January 1, 2035, 100 percent of the annual
The bill provides that the PUC by rule shall:
(1) establish the minimum annual zero-carbon energy
technology generation requirement for each retail electric
provider, municipally owned utility, and electric cooperative
operating in this state in a manner designed to produce, on a
statewide basis, compliance with the requirement prescribed above
(2) specify reasonable standards that zero-carbon
energy generation must meet to count toward compliance with the
requirement prescribed above and that:
(A) are designed and operated so as to maximize
the use of all resources available to meet electric demand and
reliability needs from the capacity additions in accordance with
then-current industry standards; and
(B) encourage the development, construction, and
operation of new zero-carbon energy technology projects at sites in
this state that have the greatest economic potential for capture
and development of resources for zero-carbon energy technology.
The bill would require that the PUC develop a zero-carbon
energy generation credits trading program.
The bill would require that the PUC establish a means for a
retail electric provider, municipally owned utility, or electric
cooperative to satisfy the zero carbon requirements by
generating electricity using biomass fuel instead of directly
owning or purchasing energy generated using zero-carbon energy
Under the bill, the PUC may cap the price of zero-carbon energy
credits and may suspend the goal established above as
necessary to protect the reliability and operation of the grid. A
price cap established must equal or exceed
the social cost of carbon as determined by the United States
Environmental Protection Agency.
Under the bill, the PUC shall establish a carbon offset
alternative payment program. An entity required to
purchase a zero-carbon energy generation credit may choose to
purchase and apply a carbon capture and sequestration credit
instead of a zero-carbon energy generation credit toward the
satisfaction of the entity's obligation. A
carbon capture and sequestration credit must be purchased through a
marketplace certified by the commission to offset the same amount
of carbon as is produced by the entity's carbon energy generation.
The offset payment must equal or exceed the social cost of carbon as
determined by the United States Environmental Protection Agency.
In implementing this provision, the commission shall consider: (1) the effects of zero-carbon energy credit prices on electric rates; and (2) the effects of the carbon offset alternative payments on the zero-carbon energy credit market.