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Incentives/Policies for Renewables & Efficiency

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Energy Efficiency Goals and Requirements for Public Entities   

Last DSIRE Review: 07/17/2013
Program Overview:
State: Texas
Incentive Type: Energy Standards for Public Buildings
Eligible Efficiency Technologies: Lighting, Vending Machines (state), Others not specified
Eligible Renewable/Other Technologies: Yes; specific technologies not specified
Applicable Sectors: Schools, Local Government, State Government, Institutional, State-Funded Housing
Goal:General: Reduce electricity consumption by 5% each year for 10 years, beginning September 1, 2011
School districts: 5% energy consumption reduction from FY 2008
Equipment/Products:Requirements vary by sector (see list in summary below)
Web Site:
Authority 1:
Date Enacted:
Date Effective:
Tex. Health & Safety Code § 388.005
06/15/2001 (subsequently amended)
Authority 2:
Date Enacted:
Date Effective:
Tex. Educ. Code § 44.902 et seq.
Authority 3:
Date Enacted:
Date Effective:
Tex. Gov't Code § 2306.187
Authority 4:
Date Enacted:
Date Effective:
S.B. 59
Authority 5:
Date Enacted:
Date Effective:
S.B. 700

In 2001, Texas Senate Bill 5 (S.B. 5), was enacted to help the state comply with federal Clean Air Act standards. S.B. 5 amended the state’s Health and Safety Code to require that each political subdivision in 38 (later amended to 41) Texas counties:

  • Implement all energy efficiency measures that meet the standards established for a contract for energy conservation measures under Section 302.004(b), Local Government Code, to reduce electricity consumption by existing facilities;
  • Establish a goal to reduce electricity consumption by 5% each year for ten years, beginning September, 2011;
  • Report efforts and progress annually to the State Energy Conservation Office (SECO).

The political subdivisions affected by the mandate include most major cities and represent approximately 70% of the state's population. The program was renewed in 2007 with the passage of H.B. 3693*, which directed political subdivisions to continue reducing their electricity use by 5% annually for six more years beginning Sept. 1, 2007. In addition, H.B. 3693 expanded the list of covered entities to include institutions of higher education, state agencies, and public school districts, provided such entities have not already adopted a goal oriented energy efficiency plan.  In 2011, SB 898 extended the directive for political subdivisions to continue reducing their electricity use by 5% annually for ten more years beginning Sept. 1, 2011.

The provision detailing these requirements for school districts was an amendment to the Education Code rather than the Health and Safety Code referenced above. This section (Tex. Educ. Code § 44.902) was subsequently amended yet again in June 2009 to instead require school districts to develop long-range energy plans to reduce energy use by 5% beginning in fiscal year 2008. Thus the 5% annual electricity use reduction goal from 2007 to 2013 has been replaced with a less stringent requirement to establish a plan to reduce electricity use overall by 5% beginning in FY 2008.

A further provision of H.B. 3693 (Tex. Gov't Code § 2306.187) prescribes energy efficiency standards for new and rehabilitated single and multi-family dwellings that receive assistance from the state Department of Housing and Community Affairs (DHCA). The DHCA is directed to establish minimum standards for such buildings that may include the use of Energy Star appliances and products; energy efficient alternative construction materials; air conditioning or heat pump equipment that exceeds the energy code under Tex. Health & Safety Code § 388.003; and air ducting systems inside the conditioned space. The standards will not apply to dwellings that receive weatherization assistance money from the department or money provided under the first-time home buyer program.

Finally, the law made also several specific efficiency related requirements for different sectors:

  • State owned or leased: Energy Star appliances and equipment (general), low wattage light bulbs, vending machines with non-perishable contents equipped with energy saving devices
  • Institutes of Higher Education: Low wattage light bulbs for housing and educational buildings
  • Schools: Low wattage light bulbs for instructional facilities
  • Political Subdivisions: No specific technology requirements

The Texas Energy Partnership (TEP), consisting of SECO, the U.S. Department of Energy's Rebuild America Program and ENERGY STAR®, was formed to help the counties and cities affected by S.B. 5 and subsequent legislation. The TEP holds workshops on energy-efficient building technologies, energy management and other energy issues, and has created a web site for affected political subdivisions to report their energy savings data and to access information on benchmarking, best practices for energy efficient buildings, and green building techniques.

SECO evaluates the effectiveness of the energy efficiency programs and submits a report of its evaluation annually to the Texas Commission on Environmental Quality (TCEQ). Click here to view the 2007 annual progress report.

*A separate piece of legislation (SB 12), was signed by the Governor a week before HB 3693 and contains a number of provisions identical to those discussed above in reference to HB 3693.

  Stephen Ross
State Energy Conservation Office
111 E. 17th Street
LBJ State Office Building, Room #111
Austin, TX 78701
Phone: (800) 531-5441 Ext.1770
Phone 2: (512) 463-1770
Fax: (512) 475-2569
Web Site:
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Disclaimer: The information presented on the DSIRE web site provides an unofficial overview of financial incentives and other policies. It does not constitute professional tax advice or other professional financial guidance, and it should not be used as the only source of information when making purchasing decisions, investment decisions or tax decisions, or when executing other binding agreements. Please refer to the individual contact provided below each summary to verify that a specific financial incentive or other policy applies to your project.

While the DSIRE staff strives to provide the best information possible, the DSIRE staff, the N.C. Solar Center, N.C. State University and the Interstate Renewable Energy Council, Inc. make no representations or warranties, either express or implied, concerning the accuracy, completeness, reliability or suitability of the information. The DSIRE staff, the N.C. Solar Center, N.C. State University and the Interstate Renewable Energy Council, Inc. disclaim all liability of any kind arising out of your use or misuse of the information contained or referenced on DSIRE Web pages.

Copyright 2013 - 2014 North Carolina State University, under NREL Subcontract No. XEU-0-99515-01. Permission granted only for personal or educational use, or for use by or on behalf of the U.S. government. North Carolina State University prohibits the unauthorized display, reproduction, sale, and/or distribution of all or portions of the content of the Database of State Incentives for Renewables and Efficiency (DSIRE) without prior, written consent.