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  1. Texas Emissions Reduction Plan(TERP)Texas Commission on Environmental Quality August 4, 2004TERP Advisory Board Meeting

  2. Overview • TERP was created in 2001 by SB 5 (77th Texas Legislature) • Focus is on voluntary incentives for projects to reduce emissions of nitrogen oxides (NOx) in the nonattainment and near-nonattainment areas of Texas. • The program was amended in 2003 by HB 1365 (78th Texas Legislature) • Added Small Business Grant Program • Increased types of eligible sources and projects • Provided for new revenues

  3. TERP Programs • Chapter 386 • Emissions Reduction Incentive Grant Program (TCEQ) • Small Business Grants Program (TCEQ) • Heavy-Duty Motor Vehicle Purchase or Lease Incentive Program (TCEQ) • Light-Duty Motor Vehicle Purchase or Lease Incentive Program (TCEQ and Comptroller) • Energy Efficiency Grant Program (PUC) • Chapter 387 • New Technology Research and Development Program (TCEQ) • Chapter 388 • Texas Building Energy Performance Standards (Lab) • Energy Efficiency Programs in Certain Political Subdivisions (SECO)

  4. Legislative Report Contents • Summary of projects funded with TERP funds • Accounting of the use of funds • Status of Plan in achieving emission reductions credited in air quality plans • Summary of administrative processes • Program adjustments made since last report and necessary legislative recommendations necessary to improve the Plan

  5. Funding (FY02 – June 30, 2004) • Surcharge on off road equipment - $34.7 million • Surcharge on heavy-duty on-road vehicles - $16.1 million • 10% fee on commercial motor vehicle registrations - $22.5 million • $225 fee for inspection of out-of-state vehicles - $0 • Portion of vehicle title fees - $87.7 million • $10 fee on commercial vehicle inspections - $10.1 million • Fund balance interest - $1.8 million

  6. Emissions Reduction Incentive and Small Business Projects Funded to Date (Sept. 1, 2001 -June 30, 2004)

  7. Small Business Projects Only (as of June 30, 2004)

  8. FY04 2nd Round Selected Projects (as of July 26, 2004)

  9. FY05 Program • Staff working on allocation approaches for Commissioners’ Work Session on August 16th • Eligibility criteria for Emissions Reduction Incentive Grant Program - $7,000/ton; for Small Business Grants Program - $8,500 • Funding cap for infrastructure projects at 50% • Ensure minimal risk to state funds when funding start-up businesses • Continue funding lease projects • Continue to work with public entities on 3rd party grants; no private entities for FY05

  10. Estimated Future Revenuefor Emissions Reduction Incentive and Small Business Grants Programs • FY2005 - $127.4 million • FY2006 - $129.8 million • FY2007 - $132.8 million • FY2008 - $135.2 million

  11. New Technology Research and Development Estimated Future Revenue • FY2005 - $13.8 million • FY2006 - $14.2 million • FY2007 - $14.5 million • FY2008 - $14.7 million

  12. What is the NTRD? • The Texas Council on Environmental Technology (TCET) was created in 2001 by SB 5 to implement NTRD • Assist in developing solutions to • air • water • waste problems • Funded 15 projects totaling $2.4 million • NTRD Program was formally transferred to TCEQ in 2003, by HB 37

  13. New Technology Research & Development Program • Retrofit/add-on technologies targeted by the TERP • Advanced technologies for new engines • Studies and modeling • Advanced technologies that promote building and appliance energy performance • Advanced technologies that reduce emissions from other significant sources.

  14. Fiscal Year 2004 • Primary objective to fund : • Emissions-reducing technologies • May be eligible for funding under Chapter 386 (TERP) • 74 applications - requesting approximately $60 million in funding • 17 projects selected for $8.3 million

  15. NTRD Funding for Fiscal Year 2004

  16. NTRD Funded Projects for Fiscal Year 2004 *TERP Related

  17. Fiscal Year 2005 Applications • Primary objective to fund : • Emissions-reducing technologies • May be eligible for funding under Chapter 386 (TERP) • 104 applications - requesting approximately $73.6 million in funding • Currently in the review process