87R23596 JXC-D     By: Deshotel, Guillen H.B. No. 4120     Substitute the following for H.B. No. 4120:     By:  Paddie C.S.H.B. No. 4120       A BILL TO BE ENTITLED   AN ACT   relating to the efficient use and generation of electricity by   public schools.          BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:          SECTION 1.  Section 390.002(b), Health and Safety Code, is   amended to read as follows:          (b)  Projects that may be considered for a grant under the   program include:                (1)  diesel oxidation catalysts for school buses built   before 1994;                (2)  diesel particulate filters for school buses built   from 1994 to 1998;                (3)  the purchase and use of emission-reducing add-on   equipment for school buses, including devices that reduce crankcase   emissions;                (4)  the use of qualifying fuel;                (5)  other technologies that the commission finds will   bring about significant emissions reductions; [and]                (6)  the replacement or conversion of a [pre-2007 model   year] school bus eligible for replacement or conversion under   Section 390.004; and                (7)  the installation of charging infrastructure for   electric school buses.          SECTION 2.  Section 390.003, Health and Safety Code, is   amended by adding Subsection (a-1) to read as follows:          (a-1)  A private entity that leases school buses to a school   district or provides school bus services or supporting   infrastructure to a school district by contract may apply for and   receive a grant under the program.          SECTION 3.  Section 390.004, Health and Safety Code, is   amended by amending Subsections (a), (c), and (d) and adding   Subsections (a-1) and (a-2) to read as follows:          (a)  The commission by rule shall establish criteria for   setting priorities for projects eligible to receive grants under   this chapter. Except as provided by Subsection (a-1), the [The]   commission shall review and may modify the criteria and priorities   as appropriate.          (a-1)  The criteria must prioritize projects that achieve   the greatest reductions in diesel exhaust, especially particulate   matter.          (a-2)  The commission shall ensure that at least 75 percent   of the money issued for grants under this chapter is issued for   projects to purchase electric buses or to convert diesel buses into   electric buses.          (c)  A school bus proposed for replacement must:                (1)  be of model year 2006 or earlier if the bus will be   replaced with a combustion engine bus;                (1-a)  be of a model year that is at least six years   older than the year in which the grant application is submitted or   have an odometer reading at least 150,000 miles if the bus will be   replaced with an electric bus;                (2)  have been owned and operated by the applicant for   at least the two years before submission of the grant application;                (3)  be in good operational condition; and                (4)  be currently used on a regular, daily route to and   from a school.          (d)  A school bus proposed for purchase to replace a   [pre-2007 model year] school bus described by Subsection (c) must   be of the current model year or the year before the current model   year at the time of submission of the grant application.          SECTION 4.  Section 390.005(a), Health and Safety Code, is   amended to read as follows:          (a)  A recipient of a grant under this chapter shall use the   grant to pay the incremental costs of the project for which the   grant is made, which may include the reasonable and necessary   expenses incurred for the labor needed to install   emissions-reducing equipment or vehicle charging infrastructure.   The recipient may not use the grant to pay the recipient's   administrative expenses.          SECTION 5.  Chapter 35, Utilities Code, is amended by adding   Subchapter F to read as follows:   SUBCHAPTER F. PUBLIC SCHOOLS          Sec. 35.201.  DEFINITIONS. In this subchapter:                (1)  "Distributed renewable generation" has the   meaning assigned by Section 39.916.                (2)  "Interconnection" means the right of a person to   physically connect an energy source and related equipment to an   electricity distribution system and the technical requirements,   rules, or processes required for the connection.                (3)  "School energy source" means a source that is:                      (A)  on-site distributed renewable generation,   energy storage, or an electric school bus; and                      (B)  owned, leased, or used by a school district   or open-enrollment charter school.          Sec. 35.202.  USE OF SCHOOL ENERGY SOURCES. (a) A school   district or open-enrollment charter school that installs electric   vehicle charging equipment shall contract with an electric   cooperative, an electric utility, a municipally owned utility, or a   transmission and distribution utility to:                (1)  install make-ready infrastructure on the   cooperative's or utility's side of the meter required to facilitate   interconnection of the electric vehicle charging equipment,   including a new service connection, transformer, conductor,   connector, conduit, or meter; and                (2)  provide any necessary construction on the   cooperative's or utility's side of the meter to comply with local   regulations related to the charging equipment.          (b)  Electric cooperatives, electric utilities, municipally   owned utilities, and transmission and distribution utilities shall   use their best efforts to:                (1)  encourage and facilitate interconnection   processes for school energy sources; and                (2)  provide information about distribution system   capacity and needs to a school district or open-enrollment charter   school, or a person acting on behalf of a school district or   open-enrollment charter school, to facilitate interconnection of   school energy sources.          (c)  A school district or open-enrollment charter school, or   a person acting on behalf of a school district or open-enrollment   charter school, may:                (1)  provide distribution system grid services,   including local capacity relief, voltage and VAR support, and local   frequency control, using a school energy source or a combination of   school energy sources; and                (2)  receive appropriate compensation for distribution   grid services provided under Subdivision (1).          (d)  The independent organization certified under Section   39.151 for the ERCOT power region shall adopt rules or protocols to   allow a school district or open-enrollment charter school, or a   person acting on behalf of a school district or open-enrollment   charter school, to sell energy and ancillary services from school   energy sources in the wholesale market without registering as a   power generation company.          SECTION 6.  Subchapter H, Chapter 36, Utilities Code, is   amended by adding Section 36.3531 to read as follows:          Sec. 36.3531.  TIME-OF-USE RATES FOR PUBLIC SCHOOLS. (a)   Notwithstanding any other provision of this title, each electric   utility that provides electric service to a retail customer shall   offer to a school district or open-enrollment charter school served   by the electric utility time-of-use rates to promote efficient:                (1)  charging of electric school buses; and                (2)  energy use in school buildings.          (b)  Notwithstanding any other provision of this title, each   transmission and distribution utility in the ERCOT power region   shall offer to any retail electric provider in its service area that   serves a school district or open-enrollment charter school a rate   structure that allows the retail electric provider to offer   time-of-use rates to the district or school to promote efficient:                (1)  charging of electric school buses; and                (2)  energy use for school buildings.          SECTION 7.  The changes in law made by this Act to Chapter   390, Health and Safety Code, apply only to a Texas emissions   reduction plan grant awarded on or after the effective date of this   Act. A grant awarded before the effective date of this Act is   governed by the law in effect on the date the award was made, and the   former law is continued in effect for that purpose.          SECTION 8.  The changes in law made by this Act to Section   36.3531, Utilities Code, as added by this Act, do not require an   electric utility to initiate a new ratemaking proceeding. An   electric utility shall comply with Section 36.3531, Utilities Code,   as added by this Act, beginning with the electric utility's first   ratemaking proceeding that begins after the effective date of this   Act.          SECTION 9.  This Act takes effect September 1, 2021.