HB 3809

H.B. No. 3809
  AN ACT
  relating to the removal of battery energy storage facilities.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Title 6, Utilities Code, is amended by adding
  Chapter 303 to read as follows:
  CHAPTER 303.  BATTERY ENERGY STORAGE FACILITY AGREEMENTS
         Sec. 303.0001.  DEFINITIONS.  In this chapter:
               (1)  "Battery energy storage facility" includes:
                     (A)  a battery energy storage resource; and
                     (B)  any facility or equipment necessary to
  support the operation of a battery energy storage resource, other
  than a facility or equipment owned by an electric utility, as
  defined by Section 31.002.
               (2)  "Battery energy storage facility agreement" means
  a lease agreement between a grantee and a landowner that authorizes
  the grantee to operate a battery energy storage facility on the
  leased property.
               (3)  "Battery energy storage resource" means an
  electrochemical device, whether connected at the transmission or
  distribution level, with a capacity of one megawatt hour or greater
  that charges from the grid or a colocated generation resource and
  discharges that energy at a later time.
               (4)  "Battery operation date" means the date on which a
  battery energy storage resource is first used for its intended
  purpose.
               (5)  "Grantee" means a person, other than an electric
  utility as defined by Section 31.002, who:
                     (A)  leases property from a landowner; and
                     (B)  operates a battery energy storage facility on
  the property.
               (6)  "Recycle" means the processing, including
  disassembling, dismantling, and shredding of battery energy
  storage cells, modules or other equipment, or their components, to
  recover a usable product.
         Sec. 303.0002.  APPLICABILITY.  Except as provided by
  Section 303.0004(c), this chapter applies only to an agreement that
  authorizes a grantee to operate a battery energy storage facility
  that is not subject to Chapter 301 or 302.
         Sec. 303.0003.  WAIVER VOID; REMEDIES.  (a)  A provision of a
  battery energy storage facility agreement that purports to waive a
  right or exempt a grantee from a liability or duty established by
  this chapter is void.
         (b)  A person who is harmed by a violation of this chapter is
  entitled to appropriate injunctive relief to prevent further
  violation of this chapter.
         (c)  The provisions of this section are not exclusive.  The
  remedies provided in this section are in addition to any other
  procedures or remedies provided by other law.
         Sec. 303.0004.  REQUIRED AGREEMENT PROVISIONS ON FACILITY
  REMOVAL.  (a)  A battery energy storage facility agreement must
  provide that the grantee is responsible for removing the battery
  energy storage facility from the landowner's property and that the
  grantee shall, in accordance with any other applicable laws or
  regulations, safely:
               (1)  clear, clean, and remove from the property each
  battery energy storage resource, transformer, and substation
  installed and owned by the grantee;
               (2)  for each foundation installed in the ground for a
  battery energy storage resource, transformer, or substation
  installed and owned by the grantee:
                     (A)  clear, clean, and remove the foundation from
  the ground to a depth of at least three feet below the surface grade
  of the land in which the foundation is installed; and
                     (B)  ensure that each hole or cavity created in
  the ground by the removal is filled with soil of the same type or a
  similar type as the predominant soil found on the property;
               (3)  for each buried cable, including power,
  fiber-optic, and communications cables, installed and owned by the
  grantee:
                     (A)  clear, clean, and remove the cable from the
  ground to a depth of at least three feet below the surface grade of
  the land in which the cable is installed; and
                     (B)  ensure that each hole or cavity created in
  the ground by the removal is filled with soil of the same type or a
  similar type as the predominant soil found on the property; and
               (4)  clear, clean, and remove from the property each
  overhead power or communications line installed and owned by the
  grantee on the property.
         (b)  The agreement must provide that the grantee is
  responsible for:
               (1)  collecting and reusing or recycling, or shipping
  for reuse or recycling, all components of the battery energy
  storage facility practicably capable of being reused or recycled,
  in accordance with any other applicable laws or regulations; and
               (2)  properly disposing of components of the battery
  energy storage facility not practicably capable of being reused or
  recycled:
                     (A)  at a facility authorized under state and
  federal law to dispose of hazardous substances for a component
  considered hazardous under those laws; or
                     (B)  for nonhazardous components, at a municipal
  solid waste landfill or other appropriate waste disposal facility
  authorized under state and federal law to dispose of that type of
  component.
         (c)  A wind power facility agreement entered into under
  Chapter 301 or solar power facility agreement entered into under
  Chapter 302 that authorizes the operation of a battery energy
  storage facility must include the provisions described by
  Subsection (b) and the financial assurance required by those
  chapters must be sufficient to secure the performance of the
  grantee's obligations under that subsection, in the manner provided
  by Section 303.0005.
         (d)  The agreement must provide that, at the request of the
  landowner, the grantee shall:
               (1)  clear, clean, and remove each road constructed by
  the grantee on the property; and
               (2)  ensure that each hole or cavity created in the
  ground by the removal is filled with soil of the same type or a
  similar type as the predominant soil found on the property.
         (e)  The agreement must provide that, at the request of the
  landowner, if reasonable, the grantee shall:
               (1)  remove from the property all rocks over 12 inches
  in diameter excavated during the decommissioning or removal
  process;
               (2)  return the property to a tillable state using
  scarification, V-rip, or disc methods, as appropriate; and
               (3)  ensure that:
                     (A)  each hole or cavity created in the ground by
  the removal is filled with soil of the same type or a similar type as
  the predominant soil found on the property; and
                     (B)  the surface is returned as near as reasonably
  possible to the same condition as before the grantee dug holes or
  cavities, including by reseeding pastureland with native grasses
  prescribed by an appropriate governmental agency, if any.
         (f)  The landowner shall make a request under Subsection (d)
  or (e) not later than the 180th day after the later of:
               (1)  the date on which the landowner receives from the
  grantee via certified mail a copy of a notification of intent to
  suspend operations filed with a grid operator indicating an intent
  to permanently cease operations; or
               (2)  the date the landowner receives written notice of
  intent to decommission the battery energy storage facility from the
  grantee.
         Sec. 303.0005.  REQUIRED AGREEMENT PROVISIONS ON FINANCIAL
  ASSURANCE.  (a)  A battery energy storage facility agreement must
  provide that the grantee shall obtain and deliver to the landowner
  evidence of financial assurance that conforms to the requirements
  of this section to secure the performance of the grantee's
  obligations under Section 303.0004.  Acceptable forms of financial
  assurance include a parent company guaranty with a minimum
  investment grade credit rating for the parent company issued by a
  major domestic credit rating agency, a letter of credit, a bond, or
  another form of financial assurance reasonably acceptable to the
  landowner.
         (b)  The amount of financial assurance must be at least equal
  to the estimated amount by which the cost of removing the battery
  energy storage facilities from the landowner's property, recycling
  or disposing of all the components of the battery energy storage
  facilities, and restoring the property to as near as reasonably
  possible the condition of the property as of the date the agreement
  begins, as described by Section 303.0004, exceeds the salvage value
  of the battery energy storage facilities, less any portion of the
  value of the battery energy storage facilities pledged to secure
  outstanding debt.
         (c)  The agreement must provide that:
               (1)  the estimated cost of removing the battery energy
  storage facilities from the landowner's property, recycling or
  disposing of all the components of the battery energy storage
  facilities, and restoring the property to as near as reasonably
  possible the condition of the property as of the date the agreement
  begins, as described by Section 303.0004, and the estimated salvage
  value of the battery energy storage facilities must be determined
  by an independent, third-party professional engineer licensed in
  this state;
               (2)  the grantee must deliver to the landowner the
  estimated cost of removal and recycling or disposal of the battery
  energy storage facilities and the salvage value on or before the
  10th anniversary of the battery operation date of the grantee's
  battery energy storage resources located on the landowner's
  property; and
               (3)  the grantee must deliver an updated estimate of
  the cost and salvage value described by Subdivision (2) at least
  once every five years after the initial estimate for the remainder
  of the term of the agreement.
         (d)  The grantee is responsible for the costs of obtaining
  financial assurance described by this section and determining the
  estimated removal, recycling, and disposal costs and salvage value.
         (e)  The agreement must provide that the grantee shall
  deliver financial assurance not later than the earlier of:
               (1)  the date the battery energy storage facility
  agreement is terminated; or
               (2)  the 15th anniversary of the battery operation date
  of the grantee's battery energy storage resources located on the
  landowner's property.
         (f)  The grantee is responsible for ensuring that the amount
  of financial assurance remains sufficient to cover the amount
  required by Subsection (b), consistent with the estimates required
  by this section.
         (g)  The grantee may not cancel financial assurance before
  the date the grantee has completed the grantee's obligation to
  remove the grantee's battery energy storage facilities located on
  the landowner's property in the manner provided by this chapter,
  unless the grantee provides the landowner with replacement
  financial assurance at the time of or before the cancellation.  In
  the event of a transfer of ownership of the grantee's battery energy
  storage facilities, financial assurance provided by the grantee
  shall remain in place until the date evidence of financial
  assurance meeting the requirements of this chapter is provided to
  the landowner.
         SECTION 2.  The changes in law made by this Act apply only to
  an agreement entered into on or after the effective date of this
  Act.  An agreement entered into before the effective date of this
  Act is governed by the law in effect on the date the agreement was
  entered into, and the former law is continued in effect for that
  purpose.
         SECTION 3.  This Act takes effect September 1, 2025.
  ______________________________
  ______________________________
     President of the Senate
  Speaker of the House     
         I certify that H.B. No. 3809 was passed by the House on April
  29, 2025, by the following vote:  Yeas 145, Nays 0, 1 present, not
  voting; and that the House concurred in Senate amendments to H.B.
  No. 3809 on May 19, 2025, by the following vote:  Yeas 128, Nays 0,
  1 present, not voting.
  ______________________________
  Chief Clerk of the House   
         I certify that H.B. No. 3809 was passed by the Senate, with
  amendments, on May 13, 2025, by the following vote:  Yeas 31, Nays
  0.
  ______________________________
  Secretary of the Senate   
  APPROVED: __________________
                  Date       
           __________________
                Governor