Office of the Governor Rick Perry

Gov. Perry: Incentives will Create New Clean Energy Sources

Ceremonially signs HB 469, HB 432
Wednesday, August 19, 2009  •  Dallas, Texas  •  Press Release

Gov. Rick Perry today emphasized the importance of incentives, not burdensome mandates, to develop clean and renewable energy sources at a ceremonial bill signing for House bills 469 and 432. The governor also called on Washington to reject cap and trade legislation that would be the largest tax increase in the history of our country.

"There is no question that we need to continue building our portfolio of energy sources, but we cannot replace traditional energy sources on arbitrary timelines, relying on undeveloped technologies and punishing those who cannot comply," Gov. Perry said. "Instead, we should offer incentives that bring out the best in our people, appeal to their competitive spirit and free them to innovate. This legislation takes bold steps to continue our state’s tradition of innovation, and will keep us on the forefront of meeting our nation’s energy challenges."

This session, Texas added to its considerable progress in energy diversification. HB 469 makes projects that capture at least 50 percent of carbon dioxide emissions eligible for sales tax exemptions on capture, transport and storage equipment. The bill also allows local tax authorities to defer taxes on early stage projects once a plant is operational and has passed air emission standards. Additionally, HB 469 provides a tax exemption for oil recovered using carbon dioxide captured from a man-made emission source. As Texas is the world leader in using carbon dioxide for enhanced oil recovery projects, this bill will help stimulate the industry by offering substantial savings for using man-made carbon dioxide.

"If we are going to bring down the cost of electricity we must learn how to build a clean coal power plant," Rep. Phil King said. "This legislation will incent investors, in a competitive, free market manner, to take the economic risk of building those prototype plants, ultimately creating jobs and new technology. This bill is great for the environment, and truly a winner for Texas."

HB 432 requires that half of all state agency vehicles use alternative fuels 80 percent of the time, unless it is not deemed cost effective to do so. The bill also increases the required percentage of newly purchased low-emission state vehicles from 10 to 25 percent. Additionally, Texas State Technical College will develop a program and provide training to state agencies on converting existing vehicles to meet new requirements.

"This bill brings aggressive and necessary reform to the state's purchase policy and fueling practices for vehicles used for state business, and more than doubles the requirement for state agencies to purchase low-emission vehicles from 10 to 25 percent," Rep. Eddie Lucio III said. "These steps are strides toward making Texas a leader in embracing green technology and meeting or exceeding federal mandates for environmentally responsible operations."

If Washington were to implement the proposed cap and trade legislation, those regulations would cripple Texas' energy sector, irreparably damaging both the state and national economies and severely impacting national oil and gas supplies. Texas' energy industry fuels the nation, supplying 20 percent of the nation's oil production, one-fourth of the nation’s natural gas production, a quarter of the nation's refining capacity, and nearly 60 percent of the nation's chemical manufacturing. The Texas energy industry employs nearly 375,000 Texans with $35 billion in total wages.

Rather than making traditional energy sources more expensive, Gov. Perry continues to support making alternative energy technologies less expensive, thereby encouraging widespread commercial use and removing barriers to innovation and competition. Modernizing the national energy grid to support wind and solar energy transmission, facilitating investments in the development of carbon capture and sequestration technologies, and removing barriers to investment in nuclear generation would reduce carbon emissions while encouraging competitiveness, innovation and growth in alternative energy sources.

Diversifying the state's energy portfolio continues to be a priority for Gov. Perry. Texas has already installed more wind power than any other state and all but three countries, and provided new transmission lines that will move more than 18,000 megawatts across the state- more than all other states' current capacity combined. Texas has also attracted more than 9,000 megawatts of energy from the development of next generation nuclear power plants. The state is also looking to add new clean coal plants which will capture and sequester carbon dioxide emissions or use the carbon dioxide to increase production from Texas oil fields.

Gov. Perry: Incentives will Create New Clean Energy Sources
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