Key Texas Environmental Legislation Highlights
With the Texas 83rd Legislature Regular Session and the Governor’s veto deadline now past, brief summaries of new key environmental and energy resources laws are provided below.
HB 788 related to permitting of greenhouse gas emissions
Prefaced by a finding that the Texas Commission on Environmental Quality (TCEQ) is the preferred permitting authority for emissions of greenhouse gases, this bill requires TCEQ to adopt rules to transition authority over the greenhouse gas permitting to Texas. The bill authorizes TCEQ to submit any necessary State Implementation Plan revisions to Environmental Protection Agency (EPA) and to impose fees for emissions of greenhouse gases to the extent necessary to cover the agency’s reasonably necessary direct costs. However, the timeline for completing the transition is not established.
SB 1756 related to expedited processing of air quality applications
This bill requires TCEQ to establish an expedited permitting process for air quality applications if the applicant demonstrates that the purpose of the application will benefit the economy of the state or an area of the state. The expediting of an application does not affect a contested case hearing or applicable requirements including notice, opportunity for public hearing and submission of public comment, and the agency may impose a surcharge to an application fee to cover expenses incurred with an expedited application.
HB 2767 related to treatment and recycling of “fluid oil and gas waste”
This bill provides that ownership of “fluid oil and gas waste” (which includes hydraulic fracturing fluid and produced water) is transferred to the person who takes possession of that waste for the purpose of treating the waste for a subsequent beneficial use until the person transfers the waste or treated waste to another person for disposal or use unless expressly provided otherwise by a contract or other legally binding document. The person who takes possession of the “fluid oil and gas waste” and transfers the treated product to another for use in connection with the oil and gas drilling or production is not liable in tort for damages except in an action for personal injury, death or property damage. According to the House Research Organization bill analysis, supporters of the bill’s passage believe that the bill will remove barriers to recycling water resulting from oil and gas exploration.
HB 2982 related to Texas Railroad Commission oversight of rural gathering pipelines
This bill authorizes the Texas Railroad Commission to regulate gathering pipelines in rural areas that were previously not subject to regulation. Rules adopted by the Texas Railroad Commission that apply to intrastate transportation of hazardous liquids and carbon dioxide by gathering pipelines in rural locations and intrastate hazardous liquid and carbon dioxide gathering pipeline facilities in rural locations would need to be based on the risks the transportation and the facilities present to public safety.
SB 514 related to saltwater pipeline facilities
Under this amendment to Chapter 91 of the Natural Resources Code, a saltwater pipeline operator may install, maintain and operate a saltwater pipeline facility through, under, along, across or over a public road only if the pipeline facility complies with applicable Texas Transportation Commission rules and county and municipal regulations, ensures that the public road and associated facilities are promptly restored and the saltwater pipeline operator leases the right-of-way and pays for the fair market value of its use, unless the installation, maintenance and operation of the saltwater pipeline facility is otherwise authorized. During the legislative process, the bill received support from both environmental interests and the oil and gas sector as it was viewed to encourage the use of pipelines rather than trucks to transport oil and gas waste associated with hydraulic fracturing activities.
SB 900 related to the penalty authority of the Texas Railroad Commission
The maximum penalty amounts for violation of statutes under the jurisdiction of the Texas Railroad Commission are increased by this bill. Significant increases for the statutory maximum penalties for pipeline safety violations are established.
SB 1300 related to the Texas Environmental, Health, and Safety Audit Privilege Act
Under the amendments made to the Texas Environmental, Health, and Safety Audit Privilege Act (“Act”) by this bill, a purchaser of new assets initiating an audit on or after September 1, 2013, may now avail itself of the privilege and immunity protections under the Act. Previously, these protections were only available to facility owners and operators. With this change in the law, purchasers who begin audits before becoming owners of regulated facilities may continue an audit initiated pre-acquisition and ultimately avail themselves of the Act’s protections if they provide notice of the audit and disclosure of violations to the appropriate regulatory agency no later than 45 days after the acquisition closing date. The required notice of the audit must certify that: (i) the purchaser was not responsible for the scope of environmental, health, or safety compliance being audited; (ii) the purchaser did not have the largest ownership share of the seller; (iii) the seller did not have the largest ownership share of the purchaser; and (iv) the purchaser and seller did not have a common majority interest owner or corporate parent.