In the last two years, Texas has made over $100 million available in incentives for zero-emission trucks and buses. With incentive programs at the federal level uncertain, Texas has quietly but confidently become a leader in the clean truck industry. Texas’ light-touch approach to regulation allows it to move at the industry’s pace, focusing on incentives and policies that support Texas businesses and drive forward new ideas that bolster the state’s diverse economy.
The Texas Legislature, with one month complete in its five-month legislative session, is considering a number of key proposals to sustain and expand policies and incentives to further accelerate the transition to zero-emission transportation. Policy proposals that the Environmental Defense Fund is helping to advance include:
- Support for policy reforms for the Texas Emissions Reduction Plan that maximize efficiencies and increase competition for the state’s premier air quality grant program.
- Implementation of recommendations from the TxDOT Heavy-Duty Charging Taskforce, with a focus on the creation of an Electric Truck Advisory Council.
- Increased investment from the Texas Emissions Reduction Plan Trust Fund, which currently holds $2 billion in unspent funds.
Texas policy proposals could create a new template for state actions on zero-emission trucks Share on X
These proposals are the result of stakeholder engagement, agency meetings and reports that EDF has shepherded and participated in throughout the interim. Each has support from private companies, environmental nonprofits and community organizations. With some proposals waiting to be finally drafted and others preparing for the legislative appropriation process, many of the fine details are still under consideration. The following outline of each proposal provides a look into what to expect with the coming legislative session:
- Policy reforms for the Texas Emission Reduction Plan
Companies seeking grants for electric or hydrogen fuel cell heavy-duty vehicles through TERP must navigate as many as six different grant programs, each with their own deadlines and requirements. Program consolidation, along with streamlined administrative measures and the creation of a third-party scrappage program, can increase efficiency and maximize the competitiveness of TERP. EDF laid out specific ideas for consolidation and improvement of TERP in a report last year, and hopes to announce the filing of a comprehensive bill focused on these reforms in the weeks ahead.
- TxDOT Heavy-Duty Charging Taskforce Recommendations
TxDOT’s interagency taskforce report on heavy-duty charging infrastructure echoed many of the same TERP reforms discussed above, as well as additional funding for new full-time employees at the PUC and other agencies to provide coordination, modeling and education for utilities and fleets seeking to build out heavy-duty charging infrastructure across the state.
To fulfill these ideas, the taskforce recommended the creation of an Electric Truck Advisory Council. House Bill 1846 by Rep. Armando Walle (who authored the budget rider that created the TxDOT heavy-duty charging taskforce) would implement this recommendation by creating an ongoing interagency working group that can collect information, identify policy challenges and opportunities and coordinate statewide education and outreach on the infrastructure investments and policies needed to advance electric trucks and buses in Texas.
- Increased Investments from the TERP Trust Fund
In fiscal year 2023-2024, Texas will award approximately $336 million in grants through the Texas Emissions Reduction Plan going towards a mix of programs, including those EDF hopes to consolidate. However, beyond these dollars, which are collected and spent with each budget cycle, an additional $2 billion in funds collected from Texas industries and individuals for use in TERP are sitting untouched in the state treasury.
Texas lawmakers should begin to augment the hundreds of millions it collects each year for TERP through regular payments with the $2 billion it’s had tucked away for TERP for years. Though conservative lawmakers will not want to draw down too much in funds, so as to not risk breaking Texas’ constitutional spending limit, budget writers could add as much as $100 million more each year to TERP and further expand dollars available not only for zero-emission trucks and buses, but for other off-road and non-road grants in TERP that businesses can utilize to improve air quality across the state. Accessing these dollars could provide Texas with a competitive edge by allowing it to offer one of the two or three largest state transportation incentive programs in the country.
EDF is actively working with legislators and stakeholders on each of these proposals, with the hope that by the time the legislature finishes its work at the end of May 2025, there will be another suite of policies and investments that cement Texas’ status as a national leader in the advanced clean truck industry.
