Texas Governor signs new CHP bills into law

Source:Texas Combined Heat & Power Initiative

Concerns about power generation margins or resource adequacy and water shortages have led Texas to a policy crossroads. Texas Combined Heat & Power Initiative (TXCHPI) is pleased to announce that Texas Governor Rick Perry has signed House Bill (HB) 2049 and HB 1864 into law supporting CHP clean, energy efficient technology. These policies remove regulatory barriers and improve the business climate for cogeneration facilities in Texas.

Clean, energy efficient cogeneration often referred to, as "Combined Heat and Power" or "CHP" is the simultaneous production, and use, of electricity and heat energy. HB 2049 clarifies language in the Texas Utility Code to allow cogeneration facilities to sell electricity and heat energy to multiple customers within the proximity of the facility thereby maximizing efficiency and minimizing financial risk.

HB 1864 instructs the State Energy Conservation Office (SECO) to issue compliance guidelines for how to conduct a CHP feasibility analysis prior to the construction or renovation of any government facility deemed to be critical for disaster preparedness and emergency response. The analysis is currently required by law as part of the Hurricane Ike Disaster Preparedness statute, was previously passed during the 81st Session of the Legislature. The new legislation will help provide accurate information to elected officials for key decisions regarding on-site power generation at critical facilities used for disaster preparedness and emergency response.

CHP technology is advantageous since it increases the economic benefits of using Texas Natural Gas while preserving water for Texas communities. Natural gas used in CHP produces up to 65 percent fewer emissions than coal per kilowatt hour (kWh) making it a much cleaner base load fuel. CHP does not use water resources like traditional power generation and the energy is produced and consumed where it is needed without the loss of energy that typically occurs during transmission and distribution.

CHP in Texas will help relieve grid congestion, increase grid capacity and reduce the amount of water used in the generation of electricity. "TXCHPI believes these policy changes will be effective to help Texas meet resource adequacy challenges and provide secure energy to critical facilities during grid outages," said Paul Cauduro, Executive Director of the Texas Combined Heat and Power Initiative.

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