Texas

American and Texas Flags Flying at the Texas State Capitol Building in Austin

The Texas legislature concluded its 89th Regular Session on June 2, 2025. During the session, the energy industry paid significant attention to legislative actions impacting the power industry in the areas of grid management, reliability, power generation and resource development. The state is seeing a soaring demand for power in the state, in part due to the substantial growth in the development of large load projects. But the legislature was also hard at work on other changes to Texas laws that likely were not on the radar of the energy industry. These changes to the corporate laws in Texas sought to make Texas (as opposed to stakes like Delaware or Nevada) the new destination-of-choice for new entity formation and to attract existing companies to reincorporate in Texas. 

solar panels photovoltaics in solar farm

One of the most celebrated features of the Inflation Reduction Act (“IRA”) is the ability to sell tax credits, including the Production Tax Credit (“PTC”) under Internal Revenue Code (“IRC”) § 45 and the Investment Tax Credit (“ITC”) under IRC § 48. Under federal statute and IRS regulations issued last year, the sale of these tax credits does not result in taxable income to the seller and a buyer does not have to recognize gain on the difference between the value of the tax credit and the buyer’s purchase price. But the answer isn’t so simple under state law, which does not always track the federal rule; in some cases, whether the sale proceeds are taxable is unclear, and buyers and sellers of tax credits need to ensure that they are accurately assessing risk and expense.

Carbon capture and sequestration (CCS) is a highly effective means of reducing carbon dioxide (CO₂) emissions and mitigating climate change. This process, which has been utilized for decades, involves capturing CO₂ from sources like natural gas-fired power plants and then transporting it to underground storage facilities. The captured CO₂ is stored or sequestered in pore spaces of subsurface formations. A “pore space” in this context is typically defined as a subsurface cavity or void, whether naturally or artificially created, that can be used as a storage space CO₂.

The Texas Attorney General recently issued Opinion KP-0467 (the “Opinion”) addressing “whether a person who negotiates a lease for property for the development of a wind power project on behalf of another, for compensation, must have a license from the Texas Real Estate Commission (“Commission”).”

Put simply, do Texas landmen need a Texas real estate license to negotiate wind leases? 

The Texas Legislature, primarily responding to the unprecedented ERCOT system load shed event during 2021’s Winter Storm Uri, enacted far-reaching system and wholesale market reforms during its 2021 and 2023 legislative sessions. These reforms broadly seek to bolster electric system resilience and reliability while incentivizing, through wholesale market reforms and other out of market actions…

After nearly a decade, the Texas Attorney General and the New Mexico Attorney General announced in October 2022 that Texas, New Mexico, and Colorado had reached an agreement over the distribution of water from the Rio Grande; however, the details of the agreement, which is in the form of a proposed Consent Decree, were not known until January 23, 2023. Though the Department of Justice opposes it, the proposed Consent Decree will likely be approved by the appointed Special Master and ultimately forwarded to the U.S. Supreme Court for approval.

The Public Utility Commission of Texas (Commission) plays a vital role in regulating the Electric Reliability Council of Texas (ERCOT) wholesale market, and retail energy markets throughout all of Texas. This article identifies key projects and initiatives at the Commission that are ongoing in 2022 and have a major impact on the electric power grid and energy markets in Texas. The Commission continues to move rapidly as it implements the 2021 post-Uri legislative mandates, and we expect it to continue changing regulations affecting a wide swath of the market and the ERCOT system to bolster reliability.  Everyone engaged in the ERCOT market should continue to pay close attention to these reforms.  Husch Blackwell is following these key matters at the Commission and represents or advises clients on many of them. We are happy to answer any questions related to any item outlined below.  

Regulated energy sector entities routinely submit confidential and proprietary business information to Texas state agencies, including the Railroad Commission (Texas’s incongruously named oil and gas regulator), the General Land Office, the Public Utility Commission, and the Electric Reliability Council of Texas  (“ERCOT”), often assuming it is “for regulators’ eyes only.” But Texas agencies have limited power to prevent the disclosure of information sought pursuant to the Public Information Act (“PIA”).

Confirming landowners’ signatory authority is crucial when preparing renewable energy leases or conducting due diligence in a renewable energy financing transaction. It is not enough to rely on a landowner’s word that he or she owns a proposed project area and has the right to encumber it with a renewable energy lease. While some leases include language certifying that the landowner executing the agreement has signatory authority, failing to properly confirm that authority can result in title issues, potentially requiring lease amendments or resulting in the denial of title insurance.

In Texas, title insurance forms are promulgated by the Texas Department of Insurance (the “TDI”), with policy types, premium amounts, and the issuance of endorsements being regulated by standardized procedural and rate rules. Thus, title deliverables required for debt and equity financing transactions tend to be generally uniform in Texas renewable energy transactions.